Delbert L. and Margaret J. Baker - Page 53

                                       - 53 -                                         
          However, Mr. Powell did subtract SNF ancillary services,                    
          Medicare, and HMO billings for noncontract patients.                        
               The ad hoc committee calculated medical expenses by first              
          calculating the sum of SNF, ALU, and SCU operating expenses,                
          expenses related to the emergency-pull-cord system, and certain             
          adjustments related to food service, environmental service,                 
          utilities, and insurance.  It then subtracted noncontract patient           
          fees for the SNF, ALU, and SCU, and depreciation and amortization           
          allocable to the SNF, ALU, and SCU.34  In addition to including             
          operating expenses of the SNF, ALU, and SCU, Mr. Powell included            
          interest expense allocable to the SNF and ALU.  He did not                  
          include an expense for the emergency-pull-cord system or                    
          adjustments for food service, environmental service, utilities,             
          or insurance.  Mr. Powell did not subtract either noncontract               
          patient fees for the ALU and SCU or depreciation and amortization           
          of the SNF, ALU, and SCU.  However, he did subtract SNF ancillary           
          services, Medicare, and HMO billings for noncontract patients.              
          The ad hoc committee and Mr. Powell used slightly different                 
          financial figures in their reports.                                         





               34In the Health Facility Information report, expenses                  
          related to depreciation are included in the medical expenses                
          allocable to the SNF, ALU, and SCU.  Allocations for amortization           
          of debt issue cost, amortization of preopening cost, and interest           
          expense are not included.                                                   





Page:  Previous  43  44  45  46  47  48  49  50  51  52  53  54  55  56  57  58  59  60  61  62  Next

Last modified: May 25, 2011