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Goodwill
6 Months Ended
Dec. 31, 2012
Goodwill and Intangible Assets Disclosure [Abstract]  
GOODWILL
GOODWILL
During the three months and six months ended December 31, 2012, goodwill increased by $4.3 million, with approximately $1.0 million and $3.3 million of this increase related to acute care services segment acquisitions and health plan services segment acquisitions, respectively.
The Company has a significant amount of goodwill, which is tested for impairment at least annually but also as impairment indicators become known. The Company's fiscal 2012 annual impairment analysis did not result in any impairment of its goodwill. However, the Company's Arizona hospitals experienced market challenges that negatively impacted their results of operations and cash flows during the fiscal year ended June 30, 2012 and such challenges have continued through the six months ended December 31, 2012. These challenges included hospital reimbursement cuts, reductions to covered lives under the Arizona Health Care Cost Containment System (“AHCCCS”) program and local economic conditions that adversely impacted elective surgery volumes for these hospitals. Based upon the implementation of certain cost reduction and revenue expansion initiatives, expected improvements in the local economic and state financial conditions and the demographic composition of this market, the Company believes the future operating results and cash flows of these hospitals will improve. However, the Company will continue to monitor the operating results of these hospitals and other market environmental factors to determine if further impairment considerations are necessary with respect to the $100.7 million of goodwill for the Arizona hospitals.
The Company has $79.4 million of goodwill related to Phoenix Health Plan (“PHP”), which is included in the Company's health plan services segment. PHP's current contract with AHCCCS, Arizona's state Medicaid program, expires September 30, 2013. During the three months ended March 31, 2013, PHP will be bidding to obtain a new contract with AHCCCS. If a new contract is not awarded by AHCCCS or the new contract is significantly less in scope, either with respect to pricing or enrollment, than PHP's previous contract, PHP's operating results and cash flows would be adversely affected and may cause PHP's goodwill to be impaired.