Segment Reporting We define our reportable segments based on the way the chief operating decision maker (CODM), currently the chief executive officer, manages the operations for purposes of allocating resources and assessing performance. We classify our operations into two reportable segments as follows:  Services, which consists of our technology-enabled value-based care services, specialty care management services and comprehensive health plan administration services; and  True Health, which consists of a commercial health plan we operate in New Mexico that focuses on small and large businesses. In the ordinary course of business, our reportable segments enter into transactions with one another. While intersegment transactions are treated like third-party transactions to determine segment performance, the revenues and expenses recognized by the segment that is the counterparty to the transaction are eliminated in consolidation and do not affect consolidated results. The CODM uses Adjusted Revenue and Adjusted EBITDA as the relevant segment performance measures to evaluate the performance of the segments and allocate resources. Adjusted Revenue and Adjusted EBITDA are segment performance financial measures that offer a useful view of the overall operation of our businesses and may be different than similarly-titled segment performance financial measures used by other companies. Adjusted Revenue is defined as the sum of Adjusted Services Revenue and True Health premiums revenue less intersegment eliminations. Adjusted Services Revenue is defined as Services revenue adjusted to exclude the impact of purchase accounting adjustments. Adjusted Services Revenue consists of Adjusted Transformation Services Revenue and Adjusted Platform and Operations Services Revenue, which are defined as transformation services revenue and platform and operations services revenue, respectively, before the effect of intersegment eliminations and adjusted to exclude the impact of purchase accounting adjustments. The companys Adjusted Services Revenue for the year ended December 31, 2018 , includes a $4.5 million adjustment related to revenue that was contracted for prior to 2018 and that was properly excluded from revenue in our 2017 results under the revenue recognition rules then in effect under ASC 605. On January 1, 2018, we adopted the new revenue recognition rules under ASC 606 using the modified retrospective method, which required us to include this $4.5 million as part of the cumulative transition adjustment to beginning retained earnings as of January 1, 2018. Under ASC 605, and based on proportionate performance revenue recognition, we would have recognized an additional $4.5 million in revenue during 2018, primarily within our Adjusted Transformation Services Revenue. The Company has therefore included this revenue, and related profit, in its adjusted results for the year ended December 31, 2018 , as they had not been previously reported prior to 2018 and the contracts are expected to be completed within 2018. This is a one-time adjustment and it will not reoccur in future periods. Adjusted EBITDA is the sum of Services Adjusted EBITDA and True Health Adjusted EBITDA and is defined as EBITDA (net income (loss) attributable to Evolent Health, Inc. before interest income, interest expense, (provision) benefit for income taxes, depreciation and amortization expenses), adjusted to exclude changes in fair value of contingent consideration and indemnification assets, income (loss) from equity method investees, other income (expense), net, net (income) loss attributable to non-controlling interests, purchase accounting adjustments, stock-based compensation expenses, severance costs, amortization of contract cost assets recorded as a result of a one-time ASC 606 transition adjustment, transaction costs related to acquisitions and business combinations, goodwill impairment and other one-time adjustments (which for the year ended December 31, 2018 , includes the ASC 606 transition adjustment described above). When Adjusted EBITDA is discussed in this report, the most directly comparable GAAP financial measure is net income (loss) attributable to Evolent Health, Inc. Management considers Adjusted Revenue and Adjusted EBITDA to be the appropriate metrics to evaluate and compare the ongoing operating performance of our segments on a consistent basis across reporting periods as they eliminate the effect of items which are not indicative of each segment's core operating performance. The following tables present our segment information (in thousands): Intersegment Services True Health (1) Eliminations Consolidated Adjusted Revenue For the Year Ended December 31, 2018 Services: Adjusted Transformation Services $ 36,571 $  $  $ 36,571 Adjusted Platform and Operations Services 516,219  (14,325 ) 501,894 Adjusted Services Revenue 552,790  (14,325 ) 538,465 True Health: Premiums  94,763 (806 ) 93,957 Adjusted Revenue 552,790 94,763 (15,131 ) 632,422 ASC 606 transition adjustment (2) (4,498 )   (4,498 ) Purchase accounting adjustments (3) (861 )   (861 ) Total revenue $ 547,431 $ 94,763 $ (15,131 ) $ 627,063 For the Year Ended December 31, 2017 Services: Adjusted Transformation Services $ 29,466 $  $  $ 29,466 Adjusted Platform and Operations Services 406,951   406,951 Adjusted Services Revenue 436,417   436,417 Adjusted Revenue 436,417   436,417 Purchase accounting adjustments (3) (1,467 )   (1,467 ) Total revenue $ 434,950 $  $  $ 434,950 For the Year Ended December 31, 2016 Services: Adjusted Transformation Services $ 38,434 $  $  $ 38,434 Adjusted Platform and Operations Services 217,844   217,844 Adjusted Services Revenue 256,278   256,278 Adjusted Revenue 256,278   256,278 Purchase accounting adjustments (4) (2,090 )   (2,090 ) Total revenue $ 254,188 $  $  $ 254,188 Segments Services True Health (1) Total For the Year Ended December 31, 2018 Adjusted EBITDA $ 21,310 $ 1,915 $ 23,225 For the Year Ended December 31, 2017 Adjusted EBITDA $ (2,204 ) $  $ (2,204 ) For the Year Ended December 31, 2016 Adjusted EBITDA $ (21,407 ) $  $ (21,407 ) (1) The True Health segment was created in January 2018. (2) Adjustment to Adjusted Transformation Services Revenue was approximately $3.7 million and the adjustment to Adjusted Platform and Operations Services Revenue was approximately $0.8 million . (3) Purchase accounting adjustments pertain to Adjusted Platform and Operations Services Revenue. There were no purchase accounting adjustments in relation to Adjusted Transformation Services Revenue or True Health premiums revenue. (4) Purchase accounting adjustments of $2.1 million include an adjustment of $0.1 million to Adjusted Transformation Services Revenue and an adjustment of $2.0 million to Adjusted Platform and Operations Services Revenue. The following table presents our reconciliation of segments total Adjusted EBITDA to net income (loss) attributable to Evolent Health, Inc. (in thousands): For the Years Ended December 31, 2018 2017 2016 Net Income (Loss) Attributable to Evolent Health, Inc. $ (52,658 ) $ (60,665 ) $ (159,742 ) Less: Interest income 3,440 1,656 970 Interest expense (5,484 ) (3,636 ) (247 ) (Provision) benefit for income taxes (40 ) 6,637 10,755 Depreciation and amortization expenses (44,515 ) (32,368 ) (17,224 ) Goodwill impairment   (160,600 ) Impact of lease abandonment   (6,456 ) Income (loss) from equity method investees (4,736 ) (1,755 ) (841 ) Change in fair value of contingent consideration and indemnification asset 4,104 (400 ) 2,086 Other income (expense), net 109 171 4 Net (income) loss attributable to non-controlling interests 1,533 9,102 67,036 ASC 606 transition adjustments (4,498 )   Purchase accounting adjustments (861 ) (1,467 ) (2,090 ) Stock-based compensation expense (17,609 ) (20,437 ) (22,501 ) Severance costs (2,205 )   Amortization of contract cost assets (2,456 )   Transaction costs (2,665 ) (15,964 ) (9,227 ) Adjusted EBITDA $ 23,225 $ (2,204 ) $ (21,407 ) Asset information by segment is not a key measure of performance used by the CODM. Accordingly, we have not disclosed asset information by segment.