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facilities, and petitioner has not disputed that noncontract
patients also pay for certain services on a fee-for-service
basis. Additionally, AFVW can receive reimbursement from
Medicare and HMO insurance for care given to noncontract
patients. These fee-for-service and reimbursement proceeds are
included as revenue in AFVW’s books. Although these proceeds are
not used specifically to offset expenses in the noncontract
patient expense accounts, the revenue relates to care given to
noncontract patients in the SNF, ALU, and SCU, and we believe
that the expenses of these facilities should be reduced to
accurately reflect the portion of the monthly service fees paid
for care of AFVW residents. In substance, this treatment is
consistent with the subtraction of SNF, ALU, and SCU noncontract
patient fees from total costs and medical expenses. We have
reviewed the figures used by Mr. Powell and find them consistent
with AFVW’s financial information and acceptable for purposes of
this calculation.36
D. The Court’s Application of the Percentage Method
Mr. Dalton and the ad hoc committee applied the allocation
percentage to a weighted average of monthly service fees paid by
36We are unable to derive the amount for 1998 for SNF
ancillary services, Medicare, and HMO billings for noncontract
patients from the 1998 financial document that should have been
included in the Health Facility Information report. Therefore,
like Mr. Powell, we rely on the 1998 information contained in the
report.
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