COMMITMENTS AND CONTINGENCIES
 
Leases – We lease various operating facilities and certain medical equipment under operating leases with renewal options expiring through 2052. Certain leases contain renewal options from two to ten years and escalation based either on the consumer price index or fixed rent escalators. Leases with fixed rent escalators are recorded on a straight-line basis. We record deferred rent for tenant leasehold improvement allowances received from certain lessors and amortize the deferred rent expense over the term of the lease agreement. Minimum annual payments under operating leases for future years ending December 31 are as follows (in thousands):
 
Facilities
 
Equipment
 
Total
2019
$
75,588

 
$
14,924

 
$
90,512

2020
66,116

 
14,385

 
80,501

2021
57,826

 
12,966

 
70,792

2022
48,542

 
10,264

 
58,806

2023
38,800

 
7,095

 
45,895

Thereafter
160,327

 
5,144

 
165,471

 
$
447,199

 
$
64,778

 
$
511,977



Total rent expense, including equipment rentals, for the years ended December 31, 2018, 2017 and 2016 was $83.0 million, $78.6 million and $74.2 million, respectively.
 
Litigation – We are engaged from time to time in the defense of lawsuits arising out of the ordinary course and conduct of our business. We believe that the outcome of our current litigation will not have a material adverse impact on our business, financial condition and results of operations. However, we could be subsequently named as a defendant in other lawsuits that could adversely affect us.

Historical Timeline

Fiscal YearFiled
2018Mar 18, 2019Showing above
2017Mar 19, 2018
2016Mar 17, 2017
2015Mar 15, 2016

About Commitments Disclosures

Commitments and contingencies disclosures catalog a company's off-balance-sheet obligations and legal exposures — purchase commitments, guarantee arrangements, pending litigation, and regulatory proceedings. These items represent potential future cash outflows that may not appear as liabilities on the balance sheet until they become probable and estimable.

Key signals: litigation reserves and disclosed loss ranges quantify management's estimate of legal exposure, but unquantified "reasonably possible" losses often represent the larger risk. Watch for changes in language around pending cases — shifts from "remote" to "reasonably possible" or increases in estimated loss ranges signal deteriorating outcomes. Unconditional purchase obligations and take-or-pay contracts create fixed cost structures that reduce operational flexibility. Guarantee arrangements for subsidiaries or joint ventures can create cascading obligations. Compare the total commitment schedule against projected free cash flow to assess whether the company can meet its obligations without additional financing.