10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2021

or

☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT

For the transition period from                     to                     .

Commission file number:  0-15586

U.S. NeuroSurgical Holdings, Inc.

(Exact name of registrant as specified in its charter)

Delaware	47-5370333
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

2400 Research Blvd, Suite 325, Rockville, Maryland 20850

(Address of principal executive offices)

(301) 208-8998

(Registrant’s telephone number)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).Yes  ☒          No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company.  See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company, and “emerging growth company” in Rule 12b-2 of the Exchange Act.  (Check one):

Large accelerated filer ☐	Accelerated filer ☐
Non-accelerated filer ☐	Smaller reporting company ☒
(do not check if a smaller reporting company)	Emerging Growth Company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).          Yes  ☐          No  ☒

The number of shares of the registrant’s common stock, $0.01 par value, outstanding as of September 30, 2021 was 7,792,185.

Table of Contents

PART I - FINANCIAL INFORMATION		3
	Item 1. Financial Statements	3
	Item 2. Management Discussion and Analysis of Financial Condition and Results of Operations.	19
	Item 3. Quantitative and Qualitative Disclosures About Market Risk.	25
	Item 4. Controls and Procedures	26
PART II – OTHER INFORMATION		27
	Item 1. Legal Proceedings	27
	Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	27
	Item 3. Defaults Upon Senior Securities	28
	Item 4. Submission of Matters to a Vote of Security Holders	28
	Item 5. Other Information	28
	Item 6. Exhibits	28
SIGNATURES		29

2

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

U.S. NEUROSURGICAL HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

	September 30, 2021 (Unaudited)		December 31, 2020
ASSETS
Current assets:
Cash and cash equivalents	$	2,567,000	$	2,030,000
Accounts receivable		-		346,000
Investment in sales-type sublease - current		-		532,000
Other current assets		67,000		99,000
Total current assets		2,634,000		3,007,000
Other assets:
Due from related parties		918,000		912,000
Investments in unconsolidated entities		152,000		160,000
Total other assets		1,070,000		1,072,000
Property and equipment:
Operating lease right-of-use asset		68,000		94,000
Total property and equipment		68,000		94,000
TOTAL ASSETS	$	3,772,000	$	4,173,000
LIABILITIES
Current liabilities:
Obligations under finance lease - current portion	$	-	$	89,000
Operating lease right-of-use liability - current portion		42,000		40,000
Accounts payable and accrued expenses		180,000		170,000
Income taxes payable		197,000		111,000
Total current liabilities		419,000		410,000
Operating lease right-of-use liability - net of current portion		34,000		66,000
Guarantee liability		11,000		11,000
Total liabilities		464,000		487,000
STOCKHOLDERS’ EQUITY
Common stock - par value $0.01; 25,000,000 shares authorized; 7,792,185 shares issued and outstanding at September 30, 2021 and December 31, 2020.		78,000		78,000
Additional paid-in capital		3,100,000		3,100,000
Retained earnings		130,000		508,000
Total stockholders’ equity		3,308,000		3,686,000
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	3,772,000	$	4,173,000

The accompanying notes to condensed consolidated financial statements are an integral part hereof.

3

U.S. NEUROSURGICAL HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

	Three Months Ended September 30,
	2021			2020
Revenue	$	-		$	662,000
Costs and expenses:
Patient expenses		-			81,000
Selling, general and administrative		268,000			297,000
Total		268,000			378,000
Operating (deficit) income		(268,000	)		284,000
Interest expense		-			(5,000	)
Interest income - sales-type sublease		-			16,000
Other income		9,000			-
Loss from investments in unconsolidated entities, net		(77,000	)		(56,000	)
(Loss) income before income taxes		(336,000	)		239,000
Provision for income taxes		(8,000	)		(75,000	)
Net (loss) income	$	(344,000	)	$	164,000
Basic and diluted net (loss) income per share	$	(0.04	)	$	0.02
Weighted average common shares outstanding		7,792,185			7,792,185

The accompanying notes to condensed consolidated financial statements are an integral part hereof.

4

U.S. NEUROSURGICAL HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

	Nine Months Ended September 30,
	2021			2020
Revenue	$	1,061,000		$	2,005,000
Costs and expenses:
Patient expenses		86,000			276,000
Selling, general and administrative		815,000			941,000
Total		901,000			1,217,000
Operating income		160,000			788,000
Interest expense		(3,000	)		(24,000	)
Interest income - sales-type sublease		8,000			60,000
Other income		9,000			-
Loss from investments in unconsolidated entities, net		(350,000	)		(292,000	)
(Loss) income before income taxes		(176,000	)		532,000
Provision for income taxes		(202,000	)		(148,000	)
Net (loss) income	$	(378,000	)	$	384,000
Basic and diluted net (loss) income per share	$	(0.05	)	$	0.05
Weighted average common shares outstanding		7,792,185			7,792,185

The accompanying notes to condensed consolidated financial statements are an integral part hereof.

5

U.S. NEUROSURGICAL HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

	Nine Months ended September 30,
	2021			2020
Cash flows from operating activities:
Net (loss) income	$	(378,000	)	$	384,000
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Amortization of operating lease right-of-use asset		26,000			25,000
Loss from investments in unconsolidated entities, net		350,000			292,000
Distributed earnings from unconsolidated entities		-			63,000
Deferred income taxes		86,000			(109,000	)
Changes in:
Accounts receivable		346,000			11,000
Income taxes payable		-			(148,000	)
Other current assets		32,000			8,000
Accounts payable and accrued expenses		10,000			(47,000	)
Deferred revenue		-			69,000
Operating lease right-of-use liability		(30,000	)		(26,000	)
Net cash provided by operating activities		442,000			522,000
Cash flows from investing activities:
Advances to unconsolidated entities		(374,000	)		(337,000	)
Repayments from loans to unconsolidated entities		26,000			170,000
Capital contributions to unconsolidated entities		-			(36,000	)
Principal payments received under sales-type sublease		532,000			660,000
Net cash provided by  investing activities		184,000			457,000
Cash flows from financing activities:
Repayment of finance lease obligations		(89,000	)		(814,000	)
Net cash used in financing activities		(89,000	)		(814,000	)
Net change in cash and cash equivalents		537,000			165,000
Cash and cash equivalents - beginning of period		2,030,000			1,335,000
Cash and cash equivalents - end of period	$	2,567,000		$	1,500,000
Supplemental disclosures of cash flow information:
Cash paid for:
Interest	$	3,000		$	22,000
Income taxes	$	158,000		$	407,000

The accompanying notes to condensed consolidated financial statements are an integral part hereof.

6

U.S. NEUROSURGICAL HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note A - Basis of Preparation

The accompanying Condensed Consolidated Financial Statements of U.S. NeuroSurgical Holdings, Inc. and Subsidiaries (the “Company”) as of September 30, 2021, and 2020, are unaudited.  However, in the opinion of management, such statements include all adjustments necessary for a fair statement of the information presented therein.  The Consolidated Balance Sheet at December 31, 2020 has been derived from the audited Consolidated Financial Statements at that date appearing in the Company’s Annual Report on Form 10-K.

Pursuant to accounting requirements of the Securities and Exchange Commission applicable to quarterly reports on Form 10-Q, the accompanying Condensed Consolidated Financial Statements and notes do not include all disclosures required by accounting principles generally accepted in the United States of America for complete financial statements.  Accordingly, these statements should be read in conjunction with the Company’s most recent annual Consolidated Financial Statements.

Consolidated results of operations for interim periods are not necessarily indicative of those to be achieved for full fiscal years.  The only change to the Company’s equity in the nine months ended September 30, 2021 and 2020 was net income or loss for the periods.

In May 2014, the Financial Accounting Standards Board (the “FASB”) issued ASU 2014-09, Revenue from Contracts with Customers (“Topic 606”), amending existing revenue recognition guidance and requiring more detailed disclosures to enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. Topic 606 defines a five-step process to accomplish this objective, including identifying the contract with the customer and the performance obligations within the contract, determining the transaction price including estimates of any variable consideration, allocating the transaction price to each separate performance obligation, and recognizing revenue as the company satisfies the performance obligation. We adopted the provisions of Topic 606 as of January 1, 2018, on a modified retrospective basis and applied it to the Company’s sole contract at the date of adoption. We concluded that the impact to the manner in which we recognize revenue is immaterial. Our revenue is primarily generated from a leasing arrangement with New York University (“NYU”), which is not within the scope of Topic 606, and from the sale of maintenance services with a single performance obligation, under which revenue is recognized in a similar manner as compared to the method under the prior revenue standards. The Company recognizes maintenance income ratably over time as patient procedures are performed.

Prior to October 2018, the Company’s agreement with NYU primarily consisted of an operating lease, and the associated patient revenue from the use of the gamma knife was primarily operating lease income. In October 2018, the agreement was reevaluated to be a sales-type sublease between the Company, the lessor, and NYU, the lessee. The present value of all fixed future minimum lease payments payable by NYU to the Company were recorded as an investment in sublease effective October 1, 2018.  The patient revenue under the tiered schedule was considered contingent income and had been recognized on a systematic basis using an average fee per procedure.

7

We adopted the provisions of ASU 2016-02, Leases (“Topic 842”), as amended, as of January 1, 2019. The adoption of Topic 842 had a material impact on the Company’s Consolidated Balance Sheets due to the recognition of certain right-of-use (“ROU”) assets and lease liabilities. Although a significant amount of our revenue is now accounted for under Topic 842, this guidance did not have a material impact on our Consolidated Statements of Operations or Cash Flows. Because of the transition method we used to adopt Topic 842, Topic 842 will not be applied to periods prior to adoption and the adoption of Topic 842 had no impact on our previously reported results, or on opening equity at January 1, 2019.

The tables below present financial information associated with our leases.

	Classification	September 30,
Assets		2021		2020
Current
Finance lease assets	Investment in sales-type sublease - current	$	-	$	760,000
Long-term
Finance lease assets	Investment in sales-type sublease - net of current portion		-		-
Operating lease assets	Operating lease right-of-use asset		68,000		103,000
Total leased assets		$	68,000	$	863,000
Liabilities
Current
Finance lease liabilities	Obligations under finance lease - current portion	$	-	$	176,000
Operating lease liabilities	Operating lease right-of-use liability - current portion		42,000		39,000
Long-term
Finance lease liabilities	Obligations under finance lease - net of current portion		-		-
Operating lease liabilities	Operating lease right-of-use liability - net of current portion		34,000		77,000
Total lease liabilities		$	76,000	$	292,000
Lease Cost
Operating lease cost	Selling, general and administrative	$	31,000	$	32,000
Finance lease cost
Interest on lease liabilities	Interest expense		2,000		21,000
Sublease income	Interest income - sales-type sublease		8,000		60,000
Net lease expense (income)		$	25,000	$	(7,000	)

Maturity of lease liabilities (as of September 30, 2021)	Operating lease
2021		10,000
2022		46,000
2023		24,000
Total	$	80,000
Less amount representing interest		4,000
Present value of lease liabilities	$	76,000
Discount rate		5.850	%

8

Note B – Gamma Knife at NYU Medical Center

U.S. NeuroSurgical, Inc. (“USN”), a wholly-owned subsidiary of U.S. NeuroSurgical Holdings, Inc., opened a New York gamma knife treatment center in July 1997 on the campus of New York University (“NYU”) Medical Center.   The Company’s contract with NYU, its only customer, ended in March 2021.  Upon termination of the NYU contract, the Company recognized a gain of $100,000 relating to previously accrued expenses.  This gain was included as a reduction in selling, general and administrative expense in the quarter ended March 31, 2021.  The Company is actively seeking new business ventures and believes that its cash reserves, which approximate $2.6 million at September 30, 2021, will allow the Company the opportunity do so.  Such plans include possible new operations or extensions of its activities in Florida and California, where it has established working relationships with physician groups, hospitals and other organizations.  In addition to these activities, the Company has been exploring possible combinations with other existing businesses that would create a larger operating entity that would better justify the expenses involved in continuing as an independent publicly traded company.

Note C – The Southern California Regional Gamma Knife Center

During 2007, the Company, through a noncontrolling interest in joint ventures, managed the formation of the Southern California Regional Gamma Knife Center at San Antonio Regional Hospital (“SARH”) in Upland, California.  Corona Gamma Knife, LLC (“CGK”) is party to a 14-year agreement with SARH to renovate space in the hospital and install and operate a Leksell PERFEXION gamma knife.  CGK leases the gamma knife from NeuroPartners LLC, which holds the gamma knife equipment.  In addition to returns on its ownership interests, USNC expects to receive fees for management services relating to the facility.

USNC is a 20% owner of NeuroPartners LLC and owns 39% of CGK.

USNC was a 20% guarantor on NeuroPartners LLC’s seven-year lease with respect to the gamma knife equipment and certain leasehold improvements at SARH.  In February 2016, NeuroPartners LLC negotiated a new five-year lease to fund the reloading of cobalt and related construction services.  The new lease of $1,663,000 included a balance of $668,000 from the prior lease obligations.  This new lease was payable over 60 months.  The first payment of $31,000 was paid in April 2016 and the final payment was paid in March 2021.

Construction of the SARH gamma knife center was completed in December 2008 and the first patient was treated in January 2009.  The project has been funded principally by outside investors.  While the Company, through its joint ventures, has led the effort in organizing the business and overseeing the development and operation of the SARH center, its investment to date in the SARH center has been minimal.

At September 30, 2021 and December 31, 2020, the Company’s combined recorded investment of NeuroPartners LLC and CGK was $4,000 and $26,000, respectively. For the nine months ended September 30, 2021, the Company’s combined equity in loss of NeuroPartners LLC and CGK was $22,000 compared to combined equity in earnings of $134,000 for the nine months ended September 30, 2020.  At September 30, 2021 and December 31, 2020, amounts due from related parties was $0 and $9,000, respectively.

9

The following tables present the aggregation of summarized financial information of NeuroPartners LLC and CGK:

NeuroPartners LLC and CGK Condensed Combined Income Statement Information

	Nine Months Ended September 30,
	2021			2020
Patient Revenue	$	463,000		$	944,000
Net (loss) income	$	12,000		$	402,000
USNC’s equity in (loss) earnings of NeuroPartners, LLC and CGK	$	(22,000	)	$	134,000

	Three Months Ended September 30,
	2021				2020
Patient Revenue		$	127,000			$	274,000
Net income		$	(15,000	)		$	70,000
USNC’s equity in (loss) earnings of NeuroPartners LLC and CGK		$	(15,000	)		$	23,000

NeuroPartners LLC and CGK Condensed Combined Balance Sheet Information

	September 30, 2021		December 31, 2020
Current assets	$	262,000	$	121,000
Noncurrent assets		358,000		551,000
Total assets	$	620,000	$	672,000
Current liabilities	$	570,000	$	634,000
Equity		50,000		38,000
Total liabilities and equity	$	620,000	$	672,000

10

Note D – Florida Oncology Partners

During 2010, through the formation of a joint venture, in which it has a noncontrolling interest, the Company expanded its market strategy to include opportunities to develop cancer centers featuring radiation therapy.  These centers utilize linear accelerators with Intensity Modulated Radiation Therapy (“IMRT”) and Image Guided Radiation Therapy (“IGRT”) capabilities.  In 2010, the Company formed Florida Oncology Partners, LLC  (“FOP”) in partnership with local physicians and other investors.  USNC owns a 24% interest in the venture.  FOP’s first center was located in Miami, Florida and opened in the second quarter of 2011.

During 2011, FOP entered into a seven-year capital lease with Key Bank for $5,800,000.  Under the terms of the capital lease, USN agreed to guarantee a maximum of $1,433,000, approximately 25% of the original lease obligation in the event of default.  USN was a guarantor jointly with most of the other members of FOP.   The guarantee was eliminated upon repayment of the outstanding lease balance in May 2018.

In December 2015, FOP entered into an agreement with 21st Century Oncology for the sale of FOP’s Varian Rapid Arc linear accelerator and other medical equipment at the FOP location.  21st Century Oncology paid FOP $1,000,000 as a down payment for the equipment and agreed to make monthly payments of $172,000 for the equipment and all monthly payments due under the equipment lease with Key Bank.  As of this date, 21st Century Oncology has not satisfied all of the terms of the agreement.  In May 2017, 21st Century Oncology filed for Chapter 11 bankruptcy protection and FOP was listed as an unsecured creditor. As a result, since June 2017, FOP has not received the agreed rental payments beyond the monthly payments for the equipment lease.  As noted above, the equipment lease was repaid in May 2018 and title to the equipment was transferred to 21st Century Oncology. In December 2018, FOP was awarded 10,820 shares of 21st Century Oncology Holdings Inc. common stock as part of the bankruptcy proceedings. The title to these shares was transferred to USNC during 2020. The market value of these shares is unclear at this time as there is no readily available market for them, and accordingly, no value has been recorded for these shares at September 30, 2021 by USNC. During the year ended December 31, 2020, FOP received a payment of approximately $158,000 from 21st Century Oncology. FOP used these funds to repay $155,000 of previous advances from USNC.  FOP will continue to monitor the impact of 21st Century Oncology’s bankruptcy and pursue amounts that it is owed.  However, there can be no assurance that FOP will be successful in these efforts.

Late in 2016, FOP took initial steps toward the development of a new radiation therapy center in Homestead, Florida.   In December 2016, FOP entered into a ten-year lease agreement for office space located at 20405 Old Cutler Towne Center.  FOP had to deliver an $88,000 letter of credit in conjunction with this office lease which collateral is being held in a restricted certificate of deposit. FOP began incurring architecture costs for planning/refitting the new space.  During the first half of 2017, a financing agreement with BB&T Bank for the medical equipment and leasehold improvements was negotiated and then signed on August 31, 2017.  In November 2017, the amounts for the equipment and leasehold improvements costs were finalized and paid under this financing agreement for a total loan of $4,106,000 to be paid over seven years.  Under the terms of the financing agreement, USN agreed to guarantee the amount initially borrowed. USN is the guarantor with several other members of FOP. The outstanding balance on the financing facility was $2,819,000 at September 30, 2021 and $3,066,000 at December 31, 2020. Effective November 15, 2019, FOP transferred this loan, along with the equipment acquired with the loan proceeds, to CB Oncology Partners, LLC (“CBOP”.) The Company expects any potential liability from this guarantee to be reduced by the recoveries of the respective collateral. Late in the third quarter of 2017, it was determined that the business opportunity at this new location should be pursued by a different investor group, and FOP arranged to sell the opportunity to this group. CBOP was organized on September 1, 2017, to acquire the assets and rights in this new center from FOP.

11

In June 2017, FOP entered into an agreement with a third-party owner of a radiation therapy center located in Miami, Florida, whereby FOP took over the operation of the center effective September 22, 2017, for a ten-year initial term, and up to three additional terms of five years each. This agreement was accounted for as a capital lease and, accordingly, FOP recorded assets and capital lease liabilities totaling $14,321,000 at September 22, 2017. The lease required monthly payments in the first year of $160,000, increasing by 2% each year; currently the payment is $170,000.  FOP abandoned its operations at this radiation center on June 28, 2019 due to continued losses at the site and lack of success in good faith efforts to renegotiate the agreement after several months of discussion.  FOP could be considered in default of the agreement and the third-party owner could pursue action against FOP.  Due to the circumstances, FOP derecognized the associated assets and liabilities and calculated a contingent liability equal to the net liabilities derecognized. FOP has not, however, been released from its contractual obligation to the third-party owner.  At September 30, 2021, FOP was obligated to make a further $17.6 million of lease payments for the period from July 2019 to September 2027, with no payments made since June 2019.  Due to abandoning the operations of the Miami center as well as continued working capital deficits, FOP has filed dissolution papers to permanently cease operations in the state of Florida. In addition, FOP is seeking relief from this obligation due to the millions of dollars of deficit FOP is carrying.

The Company’s recorded investment in FOP at September 30, 2021 and December 31, 2020 has been reduced to zero due to losses incurred in prior years.  No equity in earnings has been recorded by the Company for the nine months ended September 30, 2021, and 2020, due to FOP’s deficit at September 30, 2021, and September 30, 2020.

During the year ended December 31, 2020, the Company wrote off all amounts due from FOP and accrued interest thereon. The Company recorded amounts written off and increases in the allowances as a component of loss from investments in unconsolidated entities and as a deduction in interest income for interest earned.

Because of loans made to FOP, FOP is considered a variable interest entity of the Company.  However, as the Company is not deemed to be the primary beneficiary of FOP, since it does not have the power to direct the operating activities that most significantly affect FOP’s economic performance, the entity is not consolidated, but certain disclosures are provided herein.

12

The following tables present the summarized financial information of FOP:

FOP Condensed Income Statement Information

	Nine Months Ended September 30,
	2021			2020
Income	$	-		$	-
Net loss	$	(133,000	)	$	(7,000	)
USNC’s equity in loss of FOP	$	(30,000	)	$	(2,000	)

	Three Months Ended September 30,
	2021			2020
Income	$	-		$	-
Net loss	$	(44,000	)	$	(44,000	)
USNC’s equity in loss of FOP	$	(9,000	)	$	(11,000	)

FOP Condensed Balance Sheet Information

	September 30, 2021			December 31, 2020
Current assets	$	5,000		$	7,000
Noncurrent assets		1,001,000			1,091,000
Total assets	$	1,006,000		$	1,098,000
Current liabilities	$	4,211,000		$	4,068,000
Noncurrent liabilities		870,000			969,000
Deficit		(4,075,000	)		(3,939,000	)
Total liabilities and deficit	$	1,006,000		$	1,098,000

Note E – Boca Oncology Partners

During the quarter ended June 30, 2011, the Company, through the formation of a joint venture, in which it had a noncontrolling interest, participated in the formation of Boca Oncology Partners, LLC (“BOP”), for the purpose of owning and operating a cancer center in Boca Raton, Florida.  In June 2011, Boca Oncology Partners RE, LLC (“BOPRE”,) an affiliated entity, purchased a 20% interest in Boca West IMP, owner of a medical office building in West Boca, Florida in which BOP operates.  BOP occupies 6,000 square feet of the 32,000 square foot building.  The Company invested $225,000 initially and had a 22.5% interest in BOP and BOPRE. In February 2014, the Company and other members sold their interests in BOP.

In June 2012, BOPRE purchased an additional 3.75% of Boca West IMP from another investor bringing its total interest to 23.75%. BOPRE accounts for this investment under the cost method since it does not exercise significant influence over Boca West, IMP.

13

During the years ended December 31, 2018 and 2017, several investors relinquished part of their ownership interest in BOPRE, and those interests were distributed among the remaining investors in relationship to their percentages owned. As a result, the Company now holds a 21.22% ownership interest in BOPRE, which it accounts for under the equity method. The Company’s recorded investment in BOPRE is $149,000 and $134,000 at September 30, 2021 and December 31, 2020, respectively

USNC was a 10% guarantor of 50% of the outstanding balance of Boca West IMP’s ten-year mortgage.  This mortgage had an original balance of $3,000,000 and is secured by the medical office building in which BOP operates. In April 2020, the partners of Boca West IMP refinanced the mortgage in order to recover some of the cash that was invested before the building was completely occupied and removed USNC as a guarantor.

The following tables present the summarized financial information of BOPRE:

BOPRE Condensed Income Statement Information

	Nine Months Ended September 30,
	2021			2020
Rental income		$	-		$	-
Net income		$	75,000		$	37,000
USNC’s equity in earnings of BOPRE		$	16,000		$	8,000

	Three Months Ended September 30,
	2021			2020
Rental income		$	-		$	-
Net income		$	19,000		$	30,000
USNC’s equity in earnings of BOPRE		$	4,000		$	7,000

BOPRE Condensed Balance Sheet Information

	September 30, 2021		December 31, 2020
Current assets	$	101,000	$	27,000
Noncurrent assets		757,000		757,000
Total assets	$	858,000	$	784,000
Current liabilities	$	-	$	-
Noncurrent liabilities		-		-
Equity		858,000		784,000
Total liabilities and equity	$	858,000	$	784,000

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Note F - Medical Oncology Partners

In April 2015, Medical Oncology Partners, LLC (“MOP”,) was formed in partnership with local physicians and other investors. MOP was established to acquire a 100% equity interest in United Oncology Medical Associates of Florida, LLC (“UOMA”.) USNC was not a member of MOP at the time of formation as it was not able to participate due to the fact that USNC was not a physician. Nevertheless, USNC wished to eventually obtain an equity interest in MOP and loaned Dr. Jaime Lozano, the principal investor in MOP and a co-investor in FOP, $173,000.  Dr. Lozano used these funds, along with an equal amount of his own funds (a total of $345,000), to purchase a 76.67% interest in MOP. Other investors paid a further $105,000 for the remaining equity in MOP. MOP used the $450,000 of financing to acquire a 100% equity interest in UOMA.  An application was filed for a waiver to allow USNC to hold an equity interest notwithstanding the physician requirement and on December 22, 2016, USNC was cleared to become a part owner of MOP. Dr. Lozano agreed to exchange half of his membership interest to USNC in settlement of the note to USNC.  USNC and Dr. Lozano also agreed to share equally in providing a 5% equity interest in MOP to an additional investor as a consulting fee for services rendered in the administration of MOP and UOMA. At December 22, 2016, USNC owned 35.83% of MOP with an initial carrying value of $161,000. The Company recorded its share of losses of $12,000 for the period from December 22, 2016 to December 31, 2016, against its investment which resulted in a reduction of its equity investment to $149,000.

Due to increasing costs, continued net losses since April 2015, and reliance on related party and other debt for operating cash flows, the fair value of UOMA is less than its carrying amount. The Company tested its investment for impairment at December 31, 2016 and determined that the investment was impaired, and an impairment loss was recorded against the entire equity balance in MOP, as well as loans from USN and USNC to MOP and UOMA. For the nine months ended September 30, 2021 and 2020, the Company’s equity in loss of MOP was $100,000 and $373,000, respectively, but was not recorded due to prior losses.

During the year ended December 31, 2020, the Company wrote off all remaining amounts due from MOP and UOMA and accrued interest thereon, resulting in a $686,000 loss. Increases in allowances and amounts written off have been recorded as losses from investments in unconsolidated entities. During the nine months ended September 30, 2021, the Company advanced an additional $342,000, all of which has been fully impaired. These allowances and write offs were recorded as losses from investments in unconsolidated entities.

Due to loans made to MOP and UOMA, MOP and UOMA are considered to be variable interest entities of the Company.  However, as the Company is not deemed to be the primary beneficiary of MOP or UOMA, since it does not have the power to direct the operating activities that most significantly affect MOP’s or UOMA’s economic performance, the entities are not consolidated, but certain disclosures are provided herein.

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The following table presents the summarized financial information of MOP:

MOP Condensed Consolidated Income Statement Information

	Nine Months Ended September 30,
	2021			2020
Patient revenue	$	1,601,000		$	1,473,000
Net loss	$	(280,000	)	$	(1,041,000	)
USNC’s equity in loss of MOP	$	(100,000	)	$	(373,000	)

	Three Months Ended September 30,
	2021			2020
Patient revenue	$	532,000		$	541,000
Net loss	$	(185,000	)	$	(345,000	)
USNC’s equity in loss of MOP	$	(66,000	)	$	(124,000	)

MOP Condensed Consolidated Balance Sheet Information

	September 30, 2021			December 31, 2020
Current assets	$	284,000		$	204,000
Noncurrent assets		466,000			701,000
Total assets	$	750,000		$	905,000
Current liabilities	$	3,161,000		$	2,736,000
Noncurrent liabilities		135,000			410,000
Deficit		(2,546,000	)		(2,241,000	)
Total liabilities and deficit	$	750,000		$	905,000

Note G - CB Oncology Partners

CBOP was organized September 1, 2017, to acquire the rights of the new center from FOP. USNC originally had a 24% equity interest in CBOP.  Beginning in October of 2017, CBOP began paying the remainder of the costs associated with opening the center. The medical center opened and treated its first patient in January of 2018.

Effective November 15, 2019, FOP transferred to, and CBOP assumed, a loan with BB&T bank, that it had entered into in order to finance the purchase of equipment and build out of the new center, as well as the associated property and equipment. In addition, CBOP and BB&T agreed to reduce the monthly loan repayments for the next nine months, and to extend the term of the loan from November 2024 to July 2025. In July 2020 CBOP and BB&T further agreed to reduce the monthly payments for the life of the loan and extended the loan to July of 2027.

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In June 2020, CBOP made a $500,000 capital call to its members. UNSC converted previously-made advances totaling $121,000 into equity in CBOP to meet its capital requirement, and other members contributed $212,000 in cash. The remaining capital contributions are not expected to be met and, accordingly, the Company’s equity interest in CBOP increased to 28.58% in June 2020.

Amounts due from CBOP at September 30, 2021, total $2,165,000 of outstanding principal, less $1,251,000 of allowances, for a net receivable of $914,000 all of which is included in due from related parties on the accompanying Condensed Consolidated Balance Sheet.  At December 31, 2020, CBOP owed the Company $2,154,000 of which $1,251,000 had been reserved for a net receivable of $903,000 all of which is included in due from related parties on the accompanying Condensed Consolidated Balance Sheet. These balances accrue interest at 6% per annum. Interest earned by the Company from the amounts owed by CBOP totaled $93,000 and $94,000 for the nine months ended September 30, 2021, and 2020, respectively. At September 30, 2021 and December 31, 2020, total accrued interest was $366,000 and $273,000, respectively, all of which has been fully reserved for. The Company records increases in the allowance, when applicable, as a component of loss from investments in unconsolidated entities and as a deduction in interest income for interest earned.

Due to loans made to CBOP, CBOP is considered to be a variable interest entity of the Company.  However, as the Company is not deemed to be the primary beneficiary of CBOP, since it does not have the power to direct the operating activities that most significantly affect CBOP’s economic performance, the entity is not consolidated, but certain disclosures are provided herein.

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The following table presents the summarized financial information of CBOP:

CBOP Condensed Income Statement Information

	Nine Months Ended September 30,
	2021		2020
Patient revenue	$	1,591,000	$	1,360,000
Net income (loss)	$	69,000	$	(565,000	)
USNC’s equity in earnings (loss) of CBOP	$	20,000	$	(148,000	)

	Three Months Ended September 30,
	2021			2020
Patient revenue	$	550,000		$	466,000
Net loss	$	(23,000	)	$	(165,000	)
USNC’s equity in loss of CBOP	$	(7,000	)	$	(48,000	)

CBOP Condensed Balance Sheet Information

	September 30, 2021			December 31, 2020
Current assets	$	591,000		$	385,000
Noncurrent assets		3,818,000			4,271,000
Total assets	$	4,409,000		$	4,656,000
Current liabilities	$	3,271,000		$	3,181,000
Noncurrent liabilities		3,266,000			3,684,000
Deficit		(2,128,000	)		(2,209,000	)
Total liabilities and deficit	$	4,409,000		$	4,656,000

Note H – Income Taxes

The Company’s income tax rate, which includes federal and state income taxes, was approximately 115%, for the nine months ended September 30, 2021, and 28% for the nine months ended September 30, 2020.   The Company recorded a tax charge of $202,000 and $148,000 for the nine months ended September 30, 2021, and 2020, respectively. The higher income tax expense in 2021 is primarily due to the annualized effect of the NYU contract ending in March 2021, including the catch-up tax effects of a cash basis taxpayer with no operations, and the tax effect of a valuation allowance expected to be necessary for any deferred tax asset at the end of the year.

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Note I – Subsequent Event

Acquisition of Elite Health Plan, Inc.  Effective October 1, 2021, USN, the Company’s wholly-owned subsidiary, acquired all of the outstanding shares of capital stock of Elite Health Plan, Inc., a California corporation (“Elite Health”) and, in exchange therefor, the former holders of Elite Health were issued newly-issued shares of USN, which following the transaction represent 15% of the outstanding shares of USN.  Elite Health currently has no revenue and will not be in a position to generate revenue for an indefinite period while it seeks to obtain a license to operate a Medicare Advantage Plan in California.  The plan for the development and growth of Elite Health will require the investment of significant time and financial resources.  The success of Elite Health will depend on obtaining all necessary approvals and gaining access to a competent network of providers and enrolling a critical level of subscribers. We are still evaluating the impacts from this transaction to our consolidated financial statements.

Item 2. Management Discussion and Analysis of Financial Condition and Results of Operations.

Critical Accounting Policies

The Condensed Consolidated Financial Statements of U.S. NeuroSurgical Holdings, Inc. and subsidiaries (the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America.  As such, some accounting policies have a significant impact on amounts reported in the Condensed Consolidated Financial Statements.  A summary of those significant accounting policies can be found in Note B to the Consolidated Financial Statements, in our 2020 Annual Report on Form 10-K.  In particular, judgment is used in areas such as determining and assessing possible asset impairments, including investments in, and advances, to unconsolidated entities.

We adopted the provisions of Topic 842 as of January 1, 2019. The adoption of Topic 842 had a material impact on the Company’s Consolidated Balance Sheets due to the recognition of the ROU assets and lease liabilities. Although a significant amount of our revenue is now accounted for under Topic 842, this guidance did not have a material impact on our Consolidated Statements of Operations or Cash Flows. Because of the transition method we used to adopt Topic 842, Topic 842 was not applied to periods prior to adoption and the adoption of Topic 842 had no impact on our previously reported results.

The following discussion and analysis provides information which the Company’s management believes is relevant to an assessment and understanding of the Company’s results of operations and financial condition. This discussion should be read in conjunction with the Condensed Consolidated Financial Statements and notes thereto appearing elsewhere herein.

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Recent events

The recent outbreak of the novel coronavirus COVID-19 has spread across the globe and has been declared a public health emergency by the World Health Organization and a National Emergency by the President of the United States.  Most states and municipalities in the U.S., including California, and Florida, have taken aggressive measures to reduce the spread of the disease, including limiting non-essential gatherings of people, ceasing all non-essential travel, ordering certain businesses and government agencies to cease non-essential operations at physical locations and issuing “shelter-in-place” orders, which direct individuals to shelter at their places of residence (subject to limited exceptions).  Across the healthcare industry, resources are being prioritized for the treatment and management of the outbreak.  Consequently, there are delays in delivering radiation therapy treatments.  In addition, the COVID-19 pandemic poses the risk that the Company and its employees, contractors, customers, government and third party payors and others may be prevented from conducting business activities for an indefinite period of time, including due to spread of the disease within these groups or due to shutdowns that have been and may continue to be requested or mandated by governmental authorities.

While the healthcare treatments that are provided by the Company are generally critical to the well-being of the patients it serves, a  sustained COVID-19 pandemic, and continued measures by the government and industry to contain the pandemic, could negatively impact results for the following reasons: (i) operations at medical facilities, including those operated by the Company, could be subject to reduced operation or prolonged closure; (ii) medical facilities may defer Gamma Knife and other cancer therapy treatments for non-urgent patient cases in order to allocate resources to the care of patients with COVID-19; (iii) patients may defer or cancel treatments due to real or perceived concerns about the potential spread of COVID-19 in a medical facility setting; (iv) the outbreak could materially impact operations for a sustained period of time due to the current travel bans and restrictions, quarantines, shelter-in-place orders and shutdowns; and/or (v) members of the Company’s workforce may become ill or have family members who are ill and are absent as a result, or they may elect not to come to work due to the illness affecting others in our office or facilities.

The occurrence of any of the foregoing events could have a material adverse effect on our business, financial condition and results of operations. The COVID-19 outbreak and mitigation measures have had and may continue to have an adverse impact on global economic conditions which could have an adverse effect on our business and financial condition.  The extent to which the COVID-19 outbreak impacts our results will depend on future developments that are highly uncertain and cannot be predicted, including new information that may emerge concerning the severity of the virus and the actions to contain its impact. Although the Company’s contract with its only customer ended in March 2021, the Company is actively seeking new business ventures and believes that its cash reserves, which approximate $2.6 million at September 30, 2021, will allow the Company the opportunity do so.  Such plans include possible new operations or extensions of its activities in Florida and California, where it has established working relationships with physician groups, hospitals and other organizations.  In addition to these activities, the Company has been exploring possible combinations with other existing businesses that would create a larger operating entity that would better justify the expenses involved in continuing as an independent publicly traded company.

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Results of Operations

Three Months Ended September 30, 2021, Compared to Three Months Ended September 30, 2020

Patient revenue for the three months ended September 30, 2021, and 2020 was $0 and $662,000, respectively. Prior to the termination of the Company’s contract with NYU in March 2021, the Company’s Gamma Knife facility at NYU Medical Center represented all of the Company’s patient revenue.

Patient expenses for the three months ended September 30, 2021, were $0, as compared to $81,000 reported for the comparable period in the previous year, primarily due to the annualized effects of the NYU contract ending in March 2021.

Selling, general and administrative expense of $268,000 for the third quarter of 2021 was 10% lower than the $297,000 incurred during the comparable period in 2020, due to audit-related fees during the three months ended September 30, 2021 and 2020.

The Company incurred $0 interest expense in the third quarter of 2021 and $5,000 in the comparable period in 2020 related to finance leases. Interest expense decreased due to repayment of principal balances on the gamma knife, ICON unit, and Cobalt reload leases prior to April 1, 2021.

The Company earned $0 and $16,000 of interest income from its investment in a sales-type sublease for the three months ended September 30, 2021 and 2020, respectively.

During the three months ended September 30, 2021, the Company recognized a $77,000 loss from its investment in unconsolidated entities compared to a $56,000 loss during the same period in 2020. The higher current quarter loss is primarily due to an increase of advances made to its unconsolidated entities and associated allowances.

During the three months ended September 30, 2021, the Company recognized an income tax provision of $8,000 compared to an income tax provision of $75,000 during the same period in 2020. The lower tax expense is primarily due to the effects of the NYU contract ending in March 2021 and those impacts were recognized earlier in the year.

For the three months ended September 30, 2021, the Company reported a net loss of $344,000 as compared to net income of $164,000 for the same period a year earlier. The lower net income was primarily due to the lack of revenues due to the sale of the NYU gamma knife in 2021.

Nine Months Ended September 30, 2021, Compared to Nine Months Ended September 30, 2020

Patient revenue for the nine months ended September 30, 2021, and 2020 was $1,061,000 and $2,005,000, respectively. Prior to the termination of the Company’s contract with NYU in March 2021, the Company’s Gamma Knife facility at NYU Medical Center represented all of the Company’s patient revenue.

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Patient expenses for the nine months ended September 30, 2021, were $86,000 as compared to $276,000 reported for the comparable period in the previous year, primarily due to the annualized effects of the NYU contract ending in March 2021.

Selling, general and administrative expense of $815,000 for the first nine months of 2021 was 13% lower than the $941,000 incurred during the comparable period in 2020, offset by a $100,000 gain on termination of the NYU contract and the cancellation of the flood insurance policy for the NYU facility at March 31, 2021.

The Company incurred $3,000 of interest expense for the nine months ended of 2021 and $24,000 in the comparable period in 2020 related to finance leases. Interest expense decreased due to lower principal balances on the gamma knife, ICON unit, and Cobalt reload leases.

The Company earned $8,000 and $60,000 of interest income from its investment in a sales-type sublease for the nine months ended September 30, 2021, and 2020, respectively.

During the nine months ended September 30, 2021, the Company recognized a $350,000 loss from its investment in unconsolidated entities compared to a $292,000 loss during the same period in 2020. The higher current year loss is primarily due to an increase of advances made to its unconsolidated entities and associated allowances.

During the nine months ended September 30, 2021, the Company recognized an income tax provision of $202,000 compared to an income tax provision of $148,000 during the same period in 2020. The higher tax expense in 2021 is primarily due to the annualized effects of the NYU contract ending in March 2021, forecasted taxable losses for the rest of the year, and the tax effect of a valuation allowance expected to be necessary for any deferred tax asset at the end of the year.

For the nine months ended September 30, 2021, the Company reported a net loss of $378,000 as compared to net income of $384,000 for the same period a year earlier. The lower net income was primarily due to the lack of revenues due to the sale of the NYU gamma knife in 2021, and higher income tax expense.

Liquidity and Capital Resources

At September 30, 2021, the Company had working capital of $2,214,000 as compared to $2,597,000 at December 31, 2020. Cash and cash equivalents at September 30, 2021 were $2,567,000 as compared to $2,030,000 at December 31, 2020.

Net cash provided by operating activities for the nine months ended September 30, 2021, was $442,000 as compared to $522,000 in the same period a year earlier. The $80,000 lower net cash inflow in 2021 was primarily due the NYU contract ending in March 2021.

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With respect to investing activities, the Company made $374,000 of advances to unconsolidated entities during the nine months ended September 30, 2021, compared with $337,000 of loans and advances in the same period a year earlier to FOP, CBOP, and MOP to assist with business operations and working capital requirements. During the first nine months of 2020, the Company made $36,000 of capital contributions to unconsolidated entities with no corresponding payments in the first nine months of 2021. The Company also received $532,000 in principal payments under the NYU sales-type sublease in 2021, compared to $660,000 during the first nine months of 2020.

With respect to financing activities, the Company’s contract with the NYU Medical Center ended in March 2021 along with all related lease arrangements.  The Company had been receiving fixed monthly payments of $50,000 through February 2021, and $30,000 through March 2021, as well as a final payment of $350,000 in March 2021.  The Company is actively seeking new business ventures that could require investment beyond its current cash reserves.  Such plans include possible new operations or extensions of its activities in Florida and California, where it has established working relationships with physician groups, hospitals and other organizations.

Recent Acquisition

As reported on October 6, 2021, U.S. NeuroSurgical, Inc.(“USN”), a wholly-owned subsidiary of the Company, acquired all of the outstanding shares of capital stock of Elite Health Plan, Inc., a California corporation (“Elite Health”) and, in exchange therefor, the former holders of Elite Health were issued newly-issued shares of USN, which following the transaction represent 15% of the outstanding shares of USN.  USN currently holds substantially all of the assets and operations of the Company.  The Company agreed with the former Elite Health shareholders that if there is no trading market for the shares of USN after six months from the closing of the transaction, such holders may request that the Company take steps that would give such holders access to the public trading market, which could be accomplished at the Company’s election through an exchange of such holders’ shares of USN for shares of the Company.

Elite Health is a private company with limited operating history.  It was formed in 2017 with the purpose of establishing a managed care organization that will operate as a Medicare Advantage Plan for seniors.  It is expected that Elite Health will operate in California – initially San Bernadino, Riverside, and Orange Counties, with the objective of addressing the growing number of Medicare eligible seniors in those markets.  Because of the collective experience of its founders and affiliates as physicians, software executives, and health plan administrators, we believe that Elite Health will be positioned to bring to southern California a comprehensive and cost-effective solution for these communities.

Elite Health is in the process of applying for a Knox Keene license to operate a Medicare Advantage Plan in California, and has taken preliminary steps toward identifying a network of providers who are well-versed in the healthcare needs of seniors in the communities in which they practice.  Elite Health founders and affiliates also have considerable experience with healthcare record based software and the proposed will endeavor to utilize the latest advances in information systems, including Artificial Intelligence (AI) and data analytics, in its processes to enhance each patient experience and control medical costs.

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The Company and Elite Health understand that the keys to success with a managed care organization are delivering comprehensive patient care and containing costs.  In addition to developing a plan to obtain necessary approvals, gaining access to a competent network of providers and enrolling a critical level of subscribers, it will be necessary for the plan to provide high quality patient care efficiently and cost effectively.  There can be no assurance that the Company and Elite Health will be effective in doing so.

Risk Factors

We desire to take advantage of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995.  The following factors, as well as the factors listed under the caption “Risk Factors” in Annual Report on our Form 10-K for the fiscal year ended December 31, 2020, have affected or could affect our actual results and could cause such results to differ materially from those expressed in any forward-looking statements made by us.  Investors should carefully consider these risks and speculative factors inherent in and affecting our business and an investment in our common stock.

Termination of Business Activity at the New York University Gamma Knife Center.  While it is the Company’s objective to expand activities to additional cancer centers that rely on a broad range of diagnostic and radiation treatments, the Company had relied on the NYU gamma knife for substantially all of its revenue.  In recent periods, services provided at NYU have represented over 90% of the Company’s revenues. The Company’s lease with NYU ended in March 2021, and it has transferred ownership of its gamma knife to NYU.  The future of the Company will depend on whether it is able to achieve success with other existing and new operations, and this will depend to a significant degree on whether it is able to identify and secure new business opportunities and achieve profitable operations at those businesses in the near term.

Plans for Development and Growth of Elite Health.  The Company recently acquired all of the outstanding stock of Elite Health in exchange for shares of USN, which holds substantially all of the Company’s assets and operations.  Elite Health currently has no revenue and will not be in a position to generate revenue for an indefinite period while it seeks to obtain a license to operate a Medicare Advantage Plan in California.  The plan for the development and growth of Elite Health will require the investment of significant time and financial resources.  The success of Elite Health will depend on obtaining all necessary approvals and gaining access to a competent network of providers and enrolling a critical level of subscribers.  Furthermore, to be financially successful, it will be necessary for the Elite Health’s operation to provide high quality patient care efficiently and cost effectively.  There can be no assurance that the Company and Elite Health will be successful in accomplishing these objectives.

Availability of Working Capital.  To date, we have earned sufficient income from operations to fund periodic operating losses and support efforts to pursue new gamma knife or other types of cancer treatment centers.

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Disclosure Regarding Forward Looking Statements

The Securities and Exchange Commission encourages companies to disclose forward looking information so that investors can better understand a company’s future prospects and make informed investment decisions.  This document contains such “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, particularly statements anticipating future growth in revenues and cash flow.  Words such as “anticipates,” “estimates,” “expects,” “projects,” “targets,” “intends,” “plans,” “believes,” “will be,” “will continue,” “will likely result,” and words and terms of similar substance used in connection with any discussion of future operating or financial performance identify such forward-looking statements.  Those forward-looking statements are based on management’s present expectations about future events.  As with any projection or forecast, they are inherently susceptible to uncertainty and changes in circumstances, and the Company is under no obligation to (and expressly disclaims any such obligation to) update or alter its forward-looking statements whether as a result of such changes, new information, future events or otherwise.

The Company operates in a highly competitive and rapidly changing environment and in businesses that are dependent on our ability to: achieve profitability; increase revenues; sustain our current level of operations; maintain satisfactory relations with business partners; attract and retain key personnel; maintain and expand our strategic alliances; and protect our intellectual property.  The Company’s actual results could differ materially from management’s expectations because of changes in such factors.  New risk factors can arise and it is not possible for management to predict all such risk factors, nor can it assess the impact of all such risk factors on the Company’s business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.  Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results.

Investors should also be aware that while the Company might, from time to time, communicate with securities analysts, it is against the Company’s policy to disclose to them any material non-public information or other confidential commercial information. Accordingly, investors should not assume that the Company agrees with any statement or report issued by any analyst irrespective of the content of the statement or report. Furthermore, the Company has a policy against issuing or confirming financial forecasts or projections issued by others.  Thus, to the extent that reports issued by securities analysts or others contain any projections, forecasts or opinions, such reports are not the responsibility of the Company.

In addition, the Company’s overall financial strategy, including growth in operations, maintaining financial ratios and strengthening the balance sheet, could be adversely affected by increased interest rates, construction delays or other transactions, economic slowdowns and changes in the Company’s plans, strategies and intentions.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Not applicable.

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Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Company’s reports under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, as appropriate, to allow timely decisions regarding required disclosure.  Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.  We do realize that we are a very small company and as a small company with only the officers and directors participating in the day to day management, with the ability to override controls, each officer and director has multiple positions and responsibilities that would normally be distributed among several employees in larger organizations with adequate segregation of duties to ensure the appropriate checks and balances.  Because the Company does not currently have a separate chief financial officer, the Chief Executive Officer performs these functions with the support of one of the Company’s outside directors who assists in the reporting and disclosure process (the “Lead Director”).

Our management evaluated the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934) as of the end of the period covered by this report.  Based upon that evaluation, the Company’s Chief Executive Officer concluded that the Company’s disclosure controls and procedures were not effective as of the end of the period covered by this report for the information required to be disclosed by the Company in the reports it files or submits under the Securities Exchange Act of 1934, as amended, to be recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, due to the material weakness in internal control over financial reporting described below.

Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934).  Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America.  The Company’s internal control over financial reporting includes those policies and procedures that:

(i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;

(ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and

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(iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.

Because of inherent limitations, internal control over financial reporting may not prevent or detect misstatements.  Therefore, even those systems determined to be effective can provide only reasonable assurance of achieving their control objectives.

Our management assessed the effectiveness of the Company’s internal control over financial reporting as of September 30, 2021. A material weakness is a control deficiency, or a combination of control deficiencies in internal controls over financial reporting, such that there is a reasonable possibility that a material misstatement of annual or interim financial statements will not be prevented or detected on a timely basis. In connection with the assessment described above, management identified the following material weakness as of September 30, 2021: The Company did not maintain sufficient qualified personnel with the appropriate level of knowledge, experience and training in the application of accounting principles generally accepted in the United States of America and in internal controls over financial reporting commensurate with its financial reporting requirements. Specifically, effective controls were not designed and in place to ensure that the Company maintained, or had access to, appropriate resources with adequate experience and expertise in the area of financial reporting for transactions such as investments in unconsolidated entities, related party receivables, impairments and income taxes, and to properly assess the application of new accounting pronouncements. The Company is in the process of developing efficient approaches to remediate this material weakness.  To do this in a cost-effective manner, considering the current extent of the Company’s operations, management is making arrangements with consultants and advisors to assist on an as-needed basis.

Changes in Internal Control over Financial Reporting

While there have not been any changes in the Company’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal quarter ended September 30, 2021, management is in the process of developing plans to remediate the material weakness identified above.

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

None

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Not applicable.

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Item 3. Defaults Upon Senior Securities

Not applicable.

Item 4. Submission of Matters to a Vote of Security Holders

Not applicable.

Item 5. Other Information

Not applicable.

Item 6. Exhibits

31.1	Certification of President and Chief Executive Officer (Principal Executive Officer and Principal Financial Officer) pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith.
32.1	Certification of President and Chief Executive Officer (Principal Executive Officer and Principal Financial Officer) pursuant to Rule 13a-14(b) of the Securities Exchange Act of 1934 and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed herewith.
101	Interactive Data Files providing financial information from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2021 in XBRL (eXtensible Business Reporting Language).  Pursuant to Regulation 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Section 11 or 12 of the Securities Act of 1933, as amended, or Section 18 of the Securities Exchange Act of 1934, as amended, and are otherwise not subject to liability.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

U.S. NeuroSurgical Holdings, Inc.

(Registrant)

Date: November 19, 2021	By:	/s/ Alan Gold
		Alan Gold
		Director, President and
		Chief Executive Officer
		and
		Principal Financial Officer
		of the Registrant

29

EX-31.1

EXHIBIT 31.1

CERTIFICATION OF PRESIDENT AND CHIEF EXECUTIVE OFFICER (PRINCIPAL EXECUTIVE OFFICER AND PRINCIPAL FINANCIAL OFFICER)

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Alan Gold, certify that:

1. I have reviewed this Report on Form 10-Q of U.S. NeuroSurgical Holdings, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures, and presented in this report my conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and;

5. I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:  November 19, 2021		/s/ Alan Gold
	Alan Gold
	President & Chairman of the Board
	(Principal Executive Officer
	and Principal Financial Officer)

EX-32.1

EXHIBIT 32.1

Certificate pursuant to 18 U.S.C. Section 1350,

as adopted pursuant to Section 906 of the

Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of U.S. NeuroSurgical Holdings, Inc. on Form 10-Q for the period ending September 30, 2021 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Alan Gold, President and Chief Executive Officer of U.S. NeuroSurgical Holdings, Inc., certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of U.S. NeuroSurgical Holdings, Inc.

/s/ Alan Gold

Alan Gold

President and Chief Executive Officer

(Principal Executive Officer

and Principal Financial

Officer)

Date: November 19, 2021

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Document and Entity Information	9 Months Ended
	Sep. 30, 2021 shares
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2021
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q3
Document Transition Report	false
Entity File Number	0-15586
Entity Registrant Name	U.S. NeuroSurgical Holdings, Inc.
Entity Central Index Key	0001089815
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	47-5370333
Entity Address, Address Line One	2400 Research Blvd, Suite 325
Entity Address, City or Town	Rockville
Entity Address, State or Province	MD
Entity Address, Postal Zip Code	20850
City Area Code	301
Local Phone Number	208-8998
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding	7,792,185

XML

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)	Sep. 30, 2021	Dec. 31, 2020
Current assets:
Cash and cash equivalents	$ 2,567,000	$ 2,030,000
Accounts receivable	0	346,000
Investment in sales-type sublease - current	0	532,000
Other current assets	67,000	99,000
Total current assets	2,634,000	3,007,000
Other assets:
Due from related parties	918,000	912,000
Investments in unconsolidated entities	152,000	160,000
Total other assets	1,070,000	1,072,000
Property and equipment:
Operating lease right-of-use asset	68,000	94,000
Total property and equipment	68,000	94,000
TOTAL ASSETS	3,772,000	4,173,000
Current liabilities:
Obligations under finance lease - current portion	0	89,000
Operating lease right-of-use liability - current portion	42,000	40,000
Accounts payable and accrued expenses	180,000	170,000
Income taxes payable	197,000	111,000
Total current liabilities	419,000	410,000
Operating lease right-of-use liability - net of current portion	34,000	66,000
Guarantee liability	11,000	11,000
Total liabilities	464,000	487,000
STOCKHOLDERS' EQUITY
Common stock - par value $.01; 25,000,000 shares authorized; 7,792,185 shares issued and outstanding at September 30, 2021 and December 31, 2020.	78,000	78,000
Additional paid-in capital	3,100,000	3,100,000
Retained earnings	130,000	508,000
Total stockholders' equity	3,308,000	3,686,000
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 3,772,000	$ 4,173,000

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CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Sep. 30, 2021	Dec. 31, 2020
STOCKHOLDERS' EQUITY
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	25,000,000	25,000,000
Common stock, shares issued (in shares)	7,792,185	7,792,185
Common stock, shares outstanding (in shares)	7,792,185	7,792,185

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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS [Abstract]
Revenue	$ 0	$ 662,000	$ 1,061,000	$ 2,005,000
Costs and expenses:
Patient expenses	0	81,000	86,000	276,000
Selling, general and administrative	268,000	297,000	815,000	941,000
Total	268,000	378,000	901,000	1,217,000
Operating (deficit) income	(268,000)	284,000	160,000	788,000
Interest expense	0	(5,000)	(3,000)	(24,000)
Interest income - sales-type sublease	0	16,000	8,000	60,000
Other income	9,000	0	9,000	0
Loss from investments in unconsolidated entities, net	(77,000)	(56,000)	(350,000)	(292,000)
(Loss) income before income taxes	(336,000)	239,000	(176,000)	532,000
Provision for income taxes	(8,000)	(75,000)	(202,000)	(148,000)
Net (loss) income	$ (344,000)	$ 164,000	$ (378,000)	$ 384,000
Basic net (loss) income per share (in dollars per share)	$ (0.04)	$ 0.02	$ (0.05)	$ 0.05
Diluted net (loss) income per share (in dollars per share)	$ (0.04)	$ 0.02	$ (0.05)	$ 0.05
Weighted average common shares outstanding (in shares)	7,792,185	7,792,185	7,792,185	7,792,185

XML

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020
Cash flows from operating activities:
Net (loss) income	$ (344,000)	$ 164,000	$ (378,000)	$ 384,000
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Amortization of operating lease right-of-use asset			26,000	25,000
Loss from investments in unconsolidated entities, net			350,000	292,000
Distributed earnings from unconsolidated entities			0	63,000
Deferred income taxes			86,000	(109,000)
Changes in:
Accounts receivable			346,000	11,000
Income taxes payable			0	(148,000)
Other current assets			32,000	8,000
Accounts payable and accrued expenses			10,000	(47,000)
Deferred revenue			0	69,000
Operating lease right-of-use liability			(30,000)	(26,000)
Net cash provided by operating activities			442,000	522,000
Cash flows from investing activities:
Advances to unconsolidated entities			(374,000)	(337,000)
Repayments from loans to unconsolidated entities			26,000	170,000
Capital contributions to unconsolidated entities			0	(36,000)
Principal payments received under sales-type sublease			532,000	660,000
Net cash provided by investing activities			184,000	457,000
Cash flows from financing activities:
Repayment of finance lease obligations			(89,000)	(814,000)
Net cash used in financing activities			(89,000)	(814,000)
Net change in cash and cash equivalents			537,000	165,000
Cash and cash equivalents - beginning of period			2,030,000	1,335,000	$ 1,335,000
Cash and cash equivalents - end of period	$ 2,567,000	$ 1,500,000	2,567,000	1,500,000	$ 2,030,000
Cash paid for:
Interest			3,000	22,000
Income taxes			$ 158,000	$ 407,000

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Basis of Preparation

9 Months Ended

Sep. 30, 2021

Basis of Preparation [Abstract]

Basis of Preparation

Note A - Basis of Preparation

The accompanying Condensed Consolidated Financial Statements of U.S. NeuroSurgical Holdings, Inc. and Subsidiaries (the “Company”) as of September 30, 2021, and 2020, are unaudited.  However, in the opinion of management, such statements include all adjustments necessary for a fair statement of the information presented therein.  The Consolidated Balance Sheet at December 31, 2020 has been derived from the audited Consolidated Financial Statements at that date appearing in the Company’s Annual Report on Form 10-K.

Pursuant to accounting requirements of the Securities and Exchange Commission applicable to quarterly reports on Form 10-Q, the accompanying Condensed Consolidated Financial Statements and notes do not include all disclosures required by accounting principles generally accepted in the United States of America for complete financial statements.  Accordingly, these statements should be read in conjunction with the Company’s most recent annual Consolidated Financial Statements.

Consolidated results of operations for interim periods are not necessarily indicative of those to be achieved for full fiscal years.  The only change to the Company’s equity in the nine months ended September 30, 2021 and 2020 was net income or loss for the periods.

In May 2014, the Financial Accounting Standards Board (the “FASB”) issued ASU 2014-09, Revenue from Contracts with Customers (“Topic 606”), amending existing revenue recognition guidance and requiring more detailed disclosures to enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. Topic 606 defines a five-step process to accomplish this objective, including identifying the contract with the customer and the performance obligations within the contract, determining the transaction price including estimates of any variable consideration, allocating the transaction price to each separate performance obligation, and recognizing revenue as the company satisfies the performance obligation. We adopted the provisions of Topic 606 as of January 1, 2018, on a modified retrospective basis and applied it to the Company’s sole contract at the date of adoption. We concluded that the impact to the manner in which we recognize revenue is immaterial. Our revenue is primarily generated from a leasing arrangement with New York University (“NYU”), which is not within the scope of Topic 606, and from the sale of maintenance services with a single performance obligation, under which revenue is recognized in a similar manner as compared to the method under the prior revenue standards. The Company recognizes maintenance income ratably over time as patient procedures are performed.

Prior to October 2018, the Company’s agreement with NYU primarily consisted of an operating lease, and the associated patient revenue from the use of the gamma knife was primarily operating lease income. In October 2018, the agreement was reevaluated to be a sales-type sublease between the Company, the lessor, and NYU, the lessee. The present value of all fixed future minimum lease payments payable by NYU to the Company were recorded as an investment in sublease effective October 1, 2018.  The patient revenue under the tiered schedule was considered contingent income and had been recognized on a systematic basis using an average fee per procedure.

We adopted the provisions of ASU 2016-02, Leases (“Topic 842”), as amended, as of January 1, 2019. The adoption of Topic 842 had a material impact on the Company’s Consolidated Balance Sheets due to the recognition of certain right-of-use (“ROU”) assets and lease liabilities. Although a significant amount of our revenue is now accounted for under Topic 842, this guidance did not have a material impact on our Consolidated Statements of Operations or Cash Flows. Because of the transition method we used to adopt Topic 842, Topic 842 will not be applied to periods prior to adoption and the adoption of Topic 842 had no impact on our previously reported results, or on opening equity at January 1, 2019.

The tables below present financial information associated with our leases.

	Classification	September 30,
Assets		2021		2020
Current
Finance lease assets	Investment in sales-type sublease - current	$	-	$	760,000
Long-term
Finance lease assets	Investment in sales-type sublease - net of current portion		-		-
Operating lease assets	Operating lease right-of-use asset		68,000		103,000
Total leased assets		$	68,000	$	863,000
Liabilities
Current
Finance lease liabilities	Obligations under finance lease - current portion	$	-	$	176,000
Operating lease liabilities	Operating lease right-of-use liability - current portion		42,000		39,000
Long-term
Finance lease liabilities	Obligations under finance lease - net of current portion		-		-
Operating lease liabilities	Operating lease right-of-use liability - net of current portion		34,000		77,000
Total lease liabilities		$	76,000	$	292,000
Lease Cost
Operating lease cost	Selling, general and administrative	$	31,000	$	32,000
Finance lease cost
Interest on lease liabilities	Interest expense		2,000		21,000
Sublease income	Interest income - sales-type sublease		8,000		60,000
Net lease expense (income)		$	25,000	$	(7,000	)

Maturity of lease liabilities (as of September 30, 2021)	Operating lease
2021		10,000
2022		46,000
2023		24,000
Total	$	80,000
Less amount representing interest		4,000
Present value of lease liabilities	$	76,000
Discount rate		5.850	%

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Gamma Knife at NYU Medical Center

9 Months Ended

Sep. 30, 2021

Gamma Knife at NYU Medical Center [Abstract]

Gamma Knife at NYU Medical Center

Note B – Gamma Knife at NYU Medical Center

U.S. NeuroSurgical, Inc. (“USN”), a wholly-owned subsidiary of U.S. NeuroSurgical Holdings, Inc., opened a New York gamma knife treatment center in July 1997 on the campus of New York University (“NYU”) Medical Center.   The Company’s contract with NYU, its only customer, ended in March 2021.  Upon termination of the NYU contract, the Company recognized a gain of $100,000 relating to previously accrued expenses.  This gain was included as a reduction in selling, general and administrative expense in the quarter ended March 31, 2021.  The Company is actively seeking new business ventures and believes that its cash reserves, which approximate $2.6 million at September 30, 2021, will allow the Company the opportunity do so.  Such plans include possible new operations or extensions of its activities in Florida and California, where it has established working relationships with physician groups, hospitals and other organizations.  In addition to these activities, the Company has been exploring possible combinations with other existing businesses that would create a larger operating entity that would better justify the expenses involved in continuing as an independent publicly traded company.

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The Southern California Regional Gamma Knife Center

9 Months Ended

Sep. 30, 2021

The Southern California Regional Gamma Knife Center [Abstract]

The Southern California Regional Gamma Knife Center

Note C – The Southern California Regional Gamma Knife Center

During 2007, the Company, through a noncontrolling interest in joint ventures, managed the formation of the Southern California Regional Gamma Knife Center at San Antonio Regional Hospital (“SARH”) in Upland, California.  Corona Gamma Knife, LLC (“CGK”) is party to a 14-year agreement with SARH to renovate space in the hospital and install and operate a Leksell PERFEXION gamma knife.  CGK leases the gamma knife from NeuroPartners LLC, which holds the gamma knife equipment.  In addition to returns on its ownership interests, USNC expects to receive fees for management services relating to the facility.

USNC is a 20% owner of NeuroPartners LLC and owns 39% of CGK.

USNC was a 20% guarantor on NeuroPartners LLC’s seven-year lease with respect to the gamma knife equipment and certain leasehold improvements at SARH.  In February 2016, NeuroPartners LLC negotiated a new five-year lease to fund the reloading of cobalt and related construction services.  The new lease of $1,663,000 included a balance of $668,000 from the prior lease obligations.  This new lease was payable over 60 months.  The first payment of $31,000 was paid in April 2016 and the final payment was paid in March 2021.

Construction of the SARH gamma knife center was completed in December 2008 and the first patient was treated in January 2009.  The project has been funded principally by outside investors.  While the Company, through its joint ventures, has led the effort in organizing the business and overseeing the development and operation of the SARH center, its investment to date in the SARH center has been minimal.

At September 30, 2021 and December 31, 2020, the Company’s combined recorded investment of NeuroPartners LLC and CGK was $4,000 and $26,000, respectively. For the nine months ended September 30, 2021, the Company’s combined equity in loss of NeuroPartners LLC and CGK was $22,000 compared to combined equity in earnings of $134,000 for the nine months ended September 30, 2020.  At September 30, 2021 and December 31, 2020, amounts due from related parties was $0 and $9,000, respectively.

The following tables present the aggregation of summarized financial information of NeuroPartners LLC and CGK:

NeuroPartners LLC and CGK Condensed Combined Income Statement Information

	Nine Months Ended September 30,
	2021			2020
Patient Revenue	$	463,000		$	944,000
Net (loss) income	$	12,000		$	402,000
USNC’s equity in (loss) earnings of NeuroPartners, LLC and CGK	$	(22,000	)	$	134,000

	Three Months Ended September 30,
	2021				2020
Patient Revenue		$	127,000			$	274,000
Net income		$	(15,000	)		$	70,000
USNC’s equity in (loss) earnings of NeuroPartners LLC and CGK		$	(15,000	)		$	23,000

NeuroPartners LLC and CGK Condensed Combined Balance Sheet Information

	September 30, 2021		December 31, 2020
Current assets	$	262,000	$	121,000
Noncurrent assets		358,000		551,000
Total assets	$	620,000	$	672,000
Current liabilities	$	570,000	$	634,000
Equity		50,000		38,000
Total liabilities and equity	$	620,000	$	672,000

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Florida Oncology Partners

9 Months Ended

Sep. 30, 2021

Florida Oncology Partners [Abstract]

Florida Oncology Partners

Note D – Florida Oncology Partners

During 2010, through the formation of a joint venture, in which it has a noncontrolling interest, the Company expanded its market strategy to include opportunities to develop cancer centers featuring radiation therapy.  These centers utilize linear accelerators with Intensity Modulated Radiation Therapy (“IMRT”) and Image Guided Radiation Therapy (“IGRT”) capabilities.  In 2010, the Company formed Florida Oncology Partners, LLC  (“FOP”) in partnership with local physicians and other investors.  USNC owns a 24% interest in the venture.  FOP’s first center was located in Miami, Florida and opened in the second quarter of 2011.

During 2011, FOP entered into a seven-year capital lease with Key Bank for $5,800,000.  Under the terms of the capital lease, USN agreed to guarantee a maximum of $1,433,000, approximately 25% of the original lease obligation in the event of default.  USN was a guarantor jointly with most of the other members of FOP.   The guarantee was eliminated upon repayment of the outstanding lease balance in May 2018.

In December 2015, FOP entered into an agreement with 21st Century Oncology for the sale of FOP’s Varian Rapid Arc linear accelerator and other medical equipment at the FOP location.  21st Century Oncology paid FOP $1,000,000 as a down payment for the equipment and agreed to make monthly payments of $172,000 for the equipment and all monthly payments due under the equipment lease with Key Bank.  As of this date, 21st Century Oncology has not satisfied all of the terms of the agreement.  In May 2017, 21st Century Oncology filed for Chapter 11 bankruptcy protection and FOP was listed as an unsecured creditor. As a result, since June 2017, FOP has not received the agreed rental payments beyond the monthly payments for the equipment lease.  As noted above, the equipment lease was repaid in May 2018 and title to the equipment was transferred to 21st Century Oncology. In December 2018, FOP was awarded 10,820 shares of 21st Century Oncology Holdings Inc. common stock as part of the bankruptcy proceedings. The title to these shares was transferred to USNC during 2020. The market value of these shares is unclear at this time as there is no readily available market for them, and accordingly, no value has been recorded for these shares at September 30, 2021 by USNC. During the year ended December 31, 2020, FOP received a payment of approximately $158,000 from 21st Century Oncology. FOP used these funds to repay $155,000 of previous advances from USNC.  FOP will continue to monitor the impact of 21st Century Oncology’s bankruptcy and pursue amounts that it is owed.  However, there can be no assurance that FOP will be successful in these efforts.

Late in 2016, FOP took initial steps toward the development of a new radiation therapy center in Homestead, Florida.   In December 2016, FOP entered into a ten-year lease agreement for office space located at 20405 Old Cutler Towne Center.  FOP had to deliver an $88,000 letter of credit in conjunction with this office lease which collateral is being held in a restricted certificate of deposit. FOP began incurring architecture costs for planning/refitting the new space.  During the first half of 2017, a financing agreement with BB&T Bank for the medical equipment and leasehold improvements was negotiated and then signed on August 31, 2017.  In November 2017, the amounts for the equipment and leasehold improvements costs were finalized and paid under this financing agreement for a total loan of $4,106,000 to be paid over seven years.  Under the terms of the financing agreement, USN agreed to guarantee the amount initially borrowed. USN is the guarantor with several other members of FOP. The outstanding balance on the financing facility was $2,819,000 at September 30, 2021 and $3,066,000 at December 31, 2020. Effective November 15, 2019, FOP transferred this loan, along with the equipment acquired with the loan proceeds, to CB Oncology Partners, LLC (“CBOP”.) The Company expects any potential liability from this guarantee to be reduced by the recoveries of the respective collateral. Late in the third quarter of 2017, it was determined that the business opportunity at this new location should be pursued by a different investor group, and FOP arranged to sell the opportunity to this group. CBOP was organized on September 1, 2017, to acquire the assets and rights in this new center from FOP.

In June 2017, FOP entered into an agreement with a third-party owner of a radiation therapy center located in Miami, Florida, whereby FOP took over the operation of the center effective September 22, 2017, for a ten-year initial term, and up to three additional terms of five years each. This agreement was accounted for as a capital lease and, accordingly, FOP recorded assets and capital lease liabilities totaling $14,321,000 at September 22, 2017. The lease required monthly payments in the first year of $160,000, increasing by 2% each year; currently the payment is $170,000.  FOP abandoned its operations at this radiation center on June 28, 2019 due to continued losses at the site and lack of success in good faith efforts to renegotiate the agreement after several months of discussion.  FOP could be considered in default of the agreement and the third-party owner could pursue action against FOP.  Due to the circumstances, FOP derecognized the associated assets and liabilities and calculated a contingent liability equal to the net liabilities derecognized. FOP has not, however, been released from its contractual obligation to the third-party owner.  At September 30, 2021, FOP was obligated to make a further $17.6 million of lease payments for the period from July 2019 to September 2027, with no payments made since June 2019.  Due to abandoning the operations of the Miami center as well as continued working capital deficits, FOP has filed dissolution papers to permanently cease operations in the state of Florida. In addition, FOP is seeking relief from this obligation due to the millions of dollars of deficit FOP is carrying.

The Company’s recorded investment in FOP at September 30, 2021 and December 31, 2020 has been reduced to zero due to losses incurred in prior years.  No equity in earnings has been recorded by the Company for the nine months ended September 30, 2021, and 2020, due to FOP’s deficit at September 30, 2021, and September 30, 2020.

During the year ended December 31, 2020, the Company wrote off all amounts due from FOP and accrued interest thereon. The Company recorded amounts written off and increases in the allowances as a component of loss from investments in unconsolidated entities and as a deduction in interest income for interest earned.

Because of loans made to FOP, FOP is considered a variable interest entity of the Company.  However, as the Company is not deemed to be the primary beneficiary of FOP, since it does not have the power to direct the operating activities that most significantly affect FOP’s economic performance, the entity is not consolidated, but certain disclosures are provided herein.

The following tables present the summarized financial information of FOP:

FOP Condensed Income Statement Information

	Nine Months Ended September 30,
	2021			2020
Income	$	-		$	-
Net loss	$	(133,000	)	$	(7,000	)
USNC’s equity in loss of FOP	$	(30,000	)	$	(2,000	)

	Three Months Ended September 30,
	2021			2020
Income	$	-		$	-
Net loss	$	(44,000	)	$	(44,000	)
USNC’s equity in loss of FOP	$	(9,000	)	$	(11,000	)

FOP Condensed Balance Sheet Information

	September 30, 2021			December 31, 2020
Current assets	$	5,000		$	7,000
Noncurrent assets		1,001,000			1,091,000
Total assets	$	1,006,000		$	1,098,000
Current liabilities	$	4,211,000		$	4,068,000
Noncurrent liabilities		870,000			969,000
Deficit		(4,075,000	)		(3,939,000	)
Total liabilities and deficit	$	1,006,000		$	1,098,000

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Boca Oncology Partners

9 Months Ended

Sep. 30, 2021

Boca Oncology Partners [Abstract]

Boca Oncology Partners

Note E – Boca Oncology Partners

During the quarter ended June 30, 2011, the Company, through the formation of a joint venture, in which it had a noncontrolling interest, participated in the formation of Boca Oncology Partners, LLC (“BOP”), for the purpose of owning and operating a cancer center in Boca Raton, Florida.  In June 2011, Boca Oncology Partners RE, LLC (“BOPRE”,) an affiliated entity, purchased a 20% interest in Boca West IMP, owner of a medical office building in West Boca, Florida in which BOP operates.  BOP occupies 6,000 square feet of the 32,000 square foot building.  The Company invested $225,000 initially and had a 22.5% interest in BOP and BOPRE. In February 2014, the Company and other members sold their interests in BOP.

In June 2012, BOPRE purchased an additional 3.75% of Boca West IMP from another investor bringing its total interest to 23.75%. BOPRE accounts for this investment under the cost method since it does not exercise significant influence over Boca West, IMP.

During the years ended December 31, 2018 and 2017, several investors relinquished part of their ownership interest in BOPRE, and those interests were distributed among the remaining investors in relationship to their percentages owned. As a result, the Company now holds a 21.22% ownership interest in BOPRE, which it accounts for under the equity method. The Company’s recorded investment in BOPRE is $149,000 and $134,000 at September 30, 2021 and December 31, 2020, respectively

USNC was a 10% guarantor of 50% of the outstanding balance of Boca West IMP’s ten-year mortgage.  This mortgage had an original balance of $3,000,000 and is secured by the medical office building in which BOP operates. In April 2020, the partners of Boca West IMP refinanced the mortgage in order to recover some of the cash that was invested before the building was completely occupied and removed USNC as a guarantor.

The following tables present the summarized financial information of BOPRE:

BOPRE Condensed Income Statement Information

	Nine Months Ended September 30,
	2021			2020
Rental income		$	-		$	-
Net income		$	75,000		$	37,000
USNC’s equity in earnings of BOPRE		$	16,000		$	8,000

	Three Months Ended September 30,
	2021			2020
Rental income		$	-		$	-
Net income		$	19,000		$	30,000
USNC’s equity in earnings of BOPRE		$	4,000		$	7,000

BOPRE Condensed Balance Sheet Information

	September 30, 2021		December 31, 2020
Current assets	$	101,000	$	27,000
Noncurrent assets		757,000		757,000
Total assets	$	858,000	$	784,000
Current liabilities	$	-	$	-
Noncurrent liabilities		-		-
Equity		858,000		784,000
Total liabilities and equity	$	858,000	$	784,000

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Medical Oncology Partners

9 Months Ended

Sep. 30, 2021

Medical Oncology Partners [Abstract]

Medical Oncology Partners

Note F - Medical Oncology Partners

In April 2015, Medical Oncology Partners, LLC (“MOP”,) was formed in partnership with local physicians and other investors. MOP was established to acquire a 100% equity interest in United Oncology Medical Associates of Florida, LLC (“UOMA”.) USNC was not a member of MOP at the time of formation as it was not able to participate due to the fact that USNC was not a physician. Nevertheless, USNC wished to eventually obtain an equity interest in MOP and loaned Dr. Jaime Lozano, the principal investor in MOP and a co-investor in FOP, $173,000.  Dr. Lozano used these funds, along with an equal amount of his own funds (a total of $345,000), to purchase a 76.67% interest in MOP. Other investors paid a further $105,000 for the remaining equity in MOP. MOP used the $450,000 of financing to acquire a 100% equity interest in UOMA.  An application was filed for a waiver to allow USNC to hold an equity interest notwithstanding the physician requirement and on December 22, 2016, USNC was cleared to become a part owner of MOP. Dr. Lozano agreed to exchange half of his membership interest to USNC in settlement of the note to USNC.  USNC and Dr. Lozano also agreed to share equally in providing a 5% equity interest in MOP to an additional investor as a consulting fee for services rendered in the administration of MOP and UOMA. At December 22, 2016, USNC owned 35.83% of MOP with an initial carrying value of $161,000. The Company recorded its share of losses of $12,000 for the period from December 22, 2016 to December 31, 2016, against its investment which resulted in a reduction of its equity investment to $149,000.

Due to increasing costs, continued net losses since April 2015, and reliance on related party and other debt for operating cash flows, the fair value of UOMA is less than its carrying amount. The Company tested its investment for impairment at December 31, 2016 and determined that the investment was impaired, and an impairment loss was recorded against the entire equity balance in MOP, as well as loans from USN and USNC to MOP and UOMA. For the nine months ended September 30, 2021 and 2020, the Company’s equity in loss of MOP was $100,000 and $373,000, respectively, but was not recorded due to prior losses.

During the year ended December 31, 2020, the Company wrote off all remaining amounts due from MOP and UOMA and accrued interest thereon, resulting in a $686,000 loss. Increases in allowances and amounts written off have been recorded as losses from investments in unconsolidated entities. During the nine months ended September 30, 2021, the Company advanced an additional $342,000, all of which has been fully impaired. These allowances and write offs were recorded as losses from investments in unconsolidated entities.

Due to loans made to MOP and UOMA, MOP and UOMA are considered to be variable interest entities of the Company.  However, as the Company is not deemed to be the primary beneficiary of MOP or UOMA, since it does not have the power to direct the operating activities that most significantly affect MOP’s or UOMA’s economic performance, the entities are not consolidated, but certain disclosures are provided herein.

The following table presents the summarized financial information of MOP:

MOP Condensed Consolidated Income Statement Information

	Nine Months Ended September 30,
	2021			2020
Patient revenue	$	1,601,000		$	1,473,000
Net loss	$	(280,000	)	$	(1,041,000	)
USNC’s equity in loss of MOP	$	(100,000	)	$	(373,000	)

	Three Months Ended September 30,
	2021			2020
Patient revenue	$	532,000		$	541,000
Net loss	$	(185,000	)	$	(345,000	)
USNC’s equity in loss of MOP	$	(66,000	)	$	(124,000	)

MOP Condensed Consolidated Balance Sheet Information

	September 30, 2021			December 31, 2020
Current assets	$	284,000		$	204,000
Noncurrent assets		466,000			701,000
Total assets	$	750,000		$	905,000
Current liabilities	$	3,161,000		$	2,736,000
Noncurrent liabilities		135,000			410,000
Deficit		(2,546,000	)		(2,241,000	)
Total liabilities and deficit	$	750,000		$	905,000

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CB Oncology Partners

9 Months Ended

Sep. 30, 2021

CB Oncology Partners [Abstract]

CB Oncology Partners

Note G - CB Oncology Partners

CBOP was organized September 1, 2017, to acquire the rights of the new center from FOP. USNC originally had a 24% equity interest in CBOP.  Beginning in October of 2017, CBOP began paying the remainder of the costs associated with opening the center. The medical center opened and treated its first patient in January of 2018.

Effective November 15, 2019, FOP transferred to, and CBOP assumed, a loan with BB&T bank, that it had entered into in order to finance the purchase of equipment and build out of the new center, as well as the associated property and equipment. In addition, CBOP and BB&T agreed to reduce the monthly loan repayments for the next nine months, and to extend the term of the loan from November 2024 to July 2025. In July 2020 CBOP and BB&T further agreed to reduce the monthly payments for the life of the loan and extended the loan to July of 2027.

In June 2020, CBOP made a $500,000 capital call to its members. UNSC converted previously-made advances totaling $121,000 into equity in CBOP to meet its capital requirement, and other members contributed $212,000 in cash. The remaining capital contributions are not expected to be met and, accordingly, the Company’s equity interest in CBOP increased to 28.58% in June 2020.

Amounts due from CBOP at September 30, 2021, total $2,165,000 of outstanding principal, less $1,251,000 of allowances, for a net receivable of $914,000 all of which is included in due from related parties on the accompanying Condensed Consolidated Balance Sheet.  At December 31, 2020, CBOP owed the Company $2,154,000 of which $1,251,000 had been reserved for a net receivable of $903,000 all of which is included in due from related parties on the accompanying Condensed Consolidated Balance Sheet. These balances accrue interest at 6% per annum. Interest earned by the Company from the amounts owed by CBOP totaled $93,000 and $94,000 for the nine months ended September 30, 2021, and 2020, respectively. At September 30, 2021 and December 31, 2020, total accrued interest was $366,000 and $273,000, respectively, all of which has been fully reserved for. The Company records increases in the allowance, when applicable, as a component of loss from investments in unconsolidated entities and as a deduction in interest income for interest earned.

Due to loans made to CBOP, CBOP is considered to be a variable interest entity of the Company.  However, as the Company is not deemed to be the primary beneficiary of CBOP, since it does not have the power to direct the operating activities that most significantly affect CBOP’s economic performance, the entity is not consolidated, but certain disclosures are provided herein.

The following table presents the summarized financial information of CBOP:

CBOP Condensed Income Statement Information

	Nine Months Ended September 30,
	2021		2020
Patient revenue	$	1,591,000	$	1,360,000
Net income (loss)	$	69,000	$	(565,000	)
USNC’s equity in earnings (loss) of CBOP	$	20,000	$	(148,000	)

	Three Months Ended September 30,
	2021			2020
Patient revenue	$	550,000		$	466,000
Net loss	$	(23,000	)	$	(165,000	)
USNC’s equity in loss of CBOP	$	(7,000	)	$	(48,000	)

CBOP Condensed Balance Sheet Information

	September 30, 2021			December 31, 2020
Current assets	$	591,000		$	385,000
Noncurrent assets		3,818,000			4,271,000
Total assets	$	4,409,000		$	4,656,000
Current liabilities	$	3,271,000		$	3,181,000
Noncurrent liabilities		3,266,000			3,684,000
Deficit		(2,128,000	)		(2,209,000	)
Total liabilities and deficit	$	4,409,000		$	4,656,000

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Income Taxes

9 Months Ended

Sep. 30, 2021

Income Taxes [Abstract]

Income Taxes

Note H – Income Taxes

The Company’s income tax rate, which includes federal and state income taxes, was approximately 115%, for the nine months ended September 30, 2021, and 28% for the nine months ended September 30, 2020.   The Company recorded a tax charge of $202,000 and $148,000 for the nine months ended September 30, 2021, and 2020, respectively. The higher income tax expense in 2021 is primarily due to the annualized effect of the NYU contract ending in March 2021, including the catch-up tax effects of a cash basis taxpayer with no operations, and the tax effect of a valuation allowance expected to be necessary for any deferred tax asset at the end of the year.

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Subsequent Event

9 Months Ended

Sep. 30, 2021

Subsequent Event [Abstract]

Subsequent Event

Note I – Subsequent Event

Acquisition of Elite Health Plan, Inc.  Effective October 1, 2021, USN, the Company’s wholly-owned subsidiary, acquired all of the outstanding shares of capital stock of Elite Health Plan, Inc., a California corporation (“Elite Health”) and, in exchange therefor, the former holders of Elite Health were issued newly-issued shares of USN, which following the transaction represent 15% of the outstanding shares of USN.  Elite Health currently has no revenue and will not be in a position to generate revenue for an indefinite period while it seeks to obtain a license to operate a Medicare Advantage Plan in California.  The plan for the development and growth of Elite Health will require the investment of significant time and financial resources.  The success of Elite Health will depend on obtaining all necessary approvals and gaining access to a competent network of providers and enrolling a critical level of subscribers. We are still evaluating the impacts from this transaction to our consolidated financial statements.

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Basis of Preparation (Tables)

9 Months Ended

Sep. 30, 2021

Basis of Preparation [Abstract]

Financial Information Associated with our Leases

The tables below present financial information associated with our leases.

	Classification	September 30,
Assets		2021		2020
Current
Finance lease assets	Investment in sales-type sublease - current	$	-	$	760,000
Long-term
Finance lease assets	Investment in sales-type sublease - net of current portion		-		-
Operating lease assets	Operating lease right-of-use asset		68,000		103,000
Total leased assets		$	68,000	$	863,000
Liabilities
Current
Finance lease liabilities	Obligations under finance lease - current portion	$	-	$	176,000
Operating lease liabilities	Operating lease right-of-use liability - current portion		42,000		39,000
Long-term
Finance lease liabilities	Obligations under finance lease - net of current portion		-		-
Operating lease liabilities	Operating lease right-of-use liability - net of current portion		34,000		77,000
Total lease liabilities		$	76,000	$	292,000
Lease Cost
Operating lease cost	Selling, general and administrative	$	31,000	$	32,000
Finance lease cost
Interest on lease liabilities	Interest expense		2,000		21,000
Sublease income	Interest income - sales-type sublease		8,000		60,000
Net lease expense (income)		$	25,000	$	(7,000	)

Maturity of Lease Liabilities

Maturity of lease liabilities (as of September 30, 2021)	Operating lease
2021		10,000
2022		46,000
2023		24,000
Total	$	80,000
Less amount representing interest		4,000
Present value of lease liabilities	$	76,000
Discount rate		5.850	%

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The Southern California Regional Gamma Knife Center (Tables)

9 Months Ended

Sep. 30, 2021

Neuro Partners LLC and CGK [Member]

Schedule of Equity Method Investments [Line Items]

Equity Method Investment Summarized Financial Information

The following tables present the aggregation of summarized financial information of NeuroPartners LLC and CGK:

NeuroPartners LLC and CGK Condensed Combined Income Statement Information

	Nine Months Ended September 30,
	2021			2020
Patient Revenue	$	463,000		$	944,000
Net (loss) income	$	12,000		$	402,000
USNC’s equity in (loss) earnings of NeuroPartners, LLC and CGK	$	(22,000	)	$	134,000

	Three Months Ended September 30,
	2021				2020
Patient Revenue		$	127,000			$	274,000
Net income		$	(15,000	)		$	70,000
USNC’s equity in (loss) earnings of NeuroPartners LLC and CGK		$	(15,000	)		$	23,000

NeuroPartners LLC and CGK Condensed Combined Balance Sheet Information

	September 30, 2021		December 31, 2020
Current assets	$	262,000	$	121,000
Noncurrent assets		358,000		551,000
Total assets	$	620,000	$	672,000
Current liabilities	$	570,000	$	634,000
Equity		50,000		38,000
Total liabilities and equity	$	620,000	$	672,000

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Florida Oncology Partners (Tables)

9 Months Ended

Sep. 30, 2021

FOP [Member]

Schedule of Equity Method Investments [Line Items]

Equity Method Investment Summarized Financial Information

The following tables present the summarized financial information of FOP:

FOP Condensed Income Statement Information

	Nine Months Ended September 30,
	2021			2020
Income	$	-		$	-
Net loss	$	(133,000	)	$	(7,000	)
USNC’s equity in loss of FOP	$	(30,000	)	$	(2,000	)

	Three Months Ended September 30,
	2021			2020
Income	$	-		$	-
Net loss	$	(44,000	)	$	(44,000	)
USNC’s equity in loss of FOP	$	(9,000	)	$	(11,000	)

FOP Condensed Balance Sheet Information

	September 30, 2021			December 31, 2020
Current assets	$	5,000		$	7,000
Noncurrent assets		1,001,000			1,091,000
Total assets	$	1,006,000		$	1,098,000
Current liabilities	$	4,211,000		$	4,068,000
Noncurrent liabilities		870,000			969,000
Deficit		(4,075,000	)		(3,939,000	)
Total liabilities and deficit	$	1,006,000		$	1,098,000

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Boca Oncology Partners (Tables)

9 Months Ended

Sep. 30, 2021

Boca Oncology Partners RE, LLC ("BOPRE") [Member]

Schedule of Equity Method Investments [Line Items]

Equity Method Investment Summarized Financial Information

The following tables present the summarized financial information of BOPRE:

BOPRE Condensed Income Statement Information

	Nine Months Ended September 30,
	2021			2020
Rental income		$	-		$	-
Net income		$	75,000		$	37,000
USNC’s equity in earnings of BOPRE		$	16,000		$	8,000

	Three Months Ended September 30,
	2021			2020
Rental income		$	-		$	-
Net income		$	19,000		$	30,000
USNC’s equity in earnings of BOPRE		$	4,000		$	7,000

BOPRE Condensed Balance Sheet Information

	September 30, 2021		December 31, 2020
Current assets	$	101,000	$	27,000
Noncurrent assets		757,000		757,000
Total assets	$	858,000	$	784,000
Current liabilities	$	-	$	-
Noncurrent liabilities		-		-
Equity		858,000		784,000
Total liabilities and equity	$	858,000	$	784,000

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Medical Oncology Partners (Tables)

9 Months Ended

Sep. 30, 2021

Medical Oncology Partners LLC [Member]

Schedule of Equity Method Investments [Line Items]

Equity Method Investment Summarized Financial Information

The following table presents the summarized financial information of MOP:

MOP Condensed Consolidated Income Statement Information

	Nine Months Ended September 30,
	2021			2020
Patient revenue	$	1,601,000		$	1,473,000
Net loss	$	(280,000	)	$	(1,041,000	)
USNC’s equity in loss of MOP	$	(100,000	)	$	(373,000	)

	Three Months Ended September 30,
	2021			2020
Patient revenue	$	532,000		$	541,000
Net loss	$	(185,000	)	$	(345,000	)
USNC’s equity in loss of MOP	$	(66,000	)	$	(124,000	)

MOP Condensed Consolidated Balance Sheet Information

	September 30, 2021			December 31, 2020
Current assets	$	284,000		$	204,000
Noncurrent assets		466,000			701,000
Total assets	$	750,000		$	905,000
Current liabilities	$	3,161,000		$	2,736,000
Noncurrent liabilities		135,000			410,000
Deficit		(2,546,000	)		(2,241,000	)
Total liabilities and deficit	$	750,000		$	905,000

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CB Oncology Partners (Tables)

9 Months Ended

Sep. 30, 2021

CB Oncology Partners LLC [Member]

Schedule of Equity Method Investments [Line Items]

Equity Method Investment Summarized Financial Information

The following table presents the summarized financial information of CBOP:

CBOP Condensed Income Statement Information

	Nine Months Ended September 30,
	2021		2020
Patient revenue	$	1,591,000	$	1,360,000
Net income (loss)	$	69,000	$	(565,000	)
USNC’s equity in earnings (loss) of CBOP	$	20,000	$	(148,000	)

	Three Months Ended September 30,
	2021			2020
Patient revenue	$	550,000		$	466,000
Net loss	$	(23,000	)	$	(165,000	)
USNC’s equity in loss of CBOP	$	(7,000	)	$	(48,000	)

CBOP Condensed Balance Sheet Information

	September 30, 2021			December 31, 2020
Current assets	$	591,000		$	385,000
Noncurrent assets		3,818,000			4,271,000
Total assets	$	4,409,000		$	4,656,000
Current liabilities	$	3,271,000		$	3,181,000
Noncurrent liabilities		3,266,000			3,684,000
Deficit		(2,128,000	)		(2,209,000	)
Total liabilities and deficit	$	4,409,000		$	4,656,000

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Basis of Preparation (Details) - USD ($)	9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020
Current Assets [Abstract]
Investment in sales-type sublease - current	$ 0	$ 760,000	$ 532,000
Long-term Assets [Abstract]
Investment in sales-type sublease - net of current portion	0	0
Operating lease right-of-use asset	68,000	103,000	94,000
Total leased assets	68,000	863,000
Current Liabilities [Abstract]
Obligations under finance lease - current portion	0	176,000	89,000
Operating lease right-of-use liability - current portion	42,000	39,000	40,000
Long-term Liabilities [Abstract]
Obligations under finance lease - net of current portion	0	0
Operating lease right-of-use liability - net of current portion	34,000	77,000	$ 66,000
Total lease liabilities	76,000	292,000
Lease Cost [Abstract]
Net lease expense	25,000
Net lease income		(7,000)
Operating lease [Abstract]
2021	10,000
2022	46,000
2023	24,000
Total	80,000
Less amount representing interest	4,000
Present value of lease liabilities	$ 76,000
Discount rate	5.85%
Selling, General and Administrative Expenses [Member]
Lease Cost [Abstract]
Operating lease cost	$ 31,000	32,000
Interest Expense [Member]
Lease Cost [Abstract]
Finance lease cost, interest on lease liabilities	2,000	21,000
Interest Income - Sales-type Sublease [Member]
Lease Cost [Abstract]
Sublease income	$ 8,000	$ 60,000

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Gamma Knife at NYU Medical Center (Details) - NYU [Member]	9 Months Ended
	Sep. 30, 2021 USD ($)
Gamma Knives at NYU Medical Center [Abstract]
Gain on termination of contract	$ 100,000
Minimum [Member]
Gamma Knives at NYU Medical Center [Abstract]
Cash reserves	$ 2,600,000

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The Southern California Regional Gamma Knife Center (Details)		3 Months Ended		9 Months Ended		12 Months Ended
	Apr. 01, 2016 USD ($)	Sep. 30, 2021 USD ($)	Sep. 30, 2020 USD ($)	Sep. 30, 2021 USD ($) Payment	Sep. 30, 2020 USD ($)	Dec. 31, 2020 USD ($)	Feb. 29, 2016 USD ($)
The Southern California Regional Gamma Knife Center [Abstract]
Renovation installation and operation agreement period				14 years
Lease payment				$ 89,000	$ 814,000
Condensed Income Statement Information [Abstract]
Patient revenue		$ 0	$ 662,000	1,061,000	2,005,000
USNC's equity in (loss) earnings		(77,000)	(56,000)	(350,000)	(292,000)
Condensed Balance Sheet Information [Abstract]
Current assets		2,634,000		2,634,000		$ 3,007,000
TOTAL ASSETS		3,772,000		3,772,000		4,173,000
Current liabilities		419,000		419,000		410,000
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY		3,772,000		3,772,000		4,173,000
Neuro Partners LLC and CGK [Member]
The Southern California Regional Gamma Knife Center [Abstract]
Recorded amount of equity method income				4,000		26,000
Neuro Partners LLC and CGK [Member] | Investment in Unconsolidated Entity [Member]
Condensed Income Statement Information [Abstract]
Patient revenue		127,000	274,000	463,000	944,000
Net income (loss)		(15,000)	70,000	12,000	402,000
USNC's equity in (loss) earnings		(15,000)	$ 23,000	(22,000)	$ 134,000
Condensed Balance Sheet Information [Abstract]
Current assets		262,000		262,000		121,000
Noncurrent assets		358,000		358,000		551,000
TOTAL ASSETS		620,000		620,000		672,000
Current liabilities		570,000		570,000		634,000
Equity		50,000		50,000		38,000
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY		$ 620,000		$ 620,000		672,000
Neuro Partners LLC [Member]
The Southern California Regional Gamma Knife Center [Abstract]
Ownership percentage		20.00%		20.00%
Neuro Partners LLC [Member] | Lease One [Member]
The Southern California Regional Gamma Knife Center [Abstract]
Share of guarantee in lease obligations				20.00%
Lease term		7 years		7 years
Lease obligation							$ 668,000
Neuro Partners LLC [Member] | Lease Two [Member]
The Southern California Regional Gamma Knife Center [Abstract]
Lease term		5 years		5 years
Lease obligation							$ 1,663,000
Number of lease payments | Payment				60
Lease payment	$ 31,000
CGK [Member]
The Southern California Regional Gamma Knife Center [Abstract]
Ownership percentage		39.00%		39.00%
Due from related parties		$ 0		$ 0		$ 9,000

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Florida Oncology Partners (Details)	1 Months Ended	3 Months Ended		9 Months Ended		12 Months Ended
	Dec. 31, 2018 USD ($) shares	Sep. 30, 2021 USD ($)	Sep. 30, 2020 USD ($)	Sep. 30, 2021 USD ($) Term	Sep. 30, 2020 USD ($)	Dec. 31, 2020 USD ($)	Dec. 31, 2015 USD ($)	Dec. 31, 2011 USD ($)	Nov. 30, 2017 USD ($)	Sep. 22, 2017 USD ($)
Florida Oncology Partners [Abstract]
Down payment of capital leases				$ 89,000	$ 814,000
Recorded distribution				0	63,000
Investments in unconsolidated entities		$ 152,000		152,000		$ 160,000
Condensed Income Statement Information [Abstract]
Income					7,000
USNC's equity in (loss) earnings		(77,000)	$ (56,000)	(350,000)	(292,000)
Condensed Balance Sheet Information [Abstract]
Current assets		2,634,000		2,634,000		3,007,000
TOTAL ASSETS		3,772,000		3,772,000		4,173,000
Current liabilities		419,000		419,000		410,000
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY		$ 3,772,000		$ 3,772,000		4,173,000
FOP [Member]
Florida Oncology Partners [Abstract]
Lease term		7 years		7 years
Lease obligation		$ 17,600,000		$ 17,600,000				$ 5,800,000
Percentage of guarantee obligations								25.00%
Down payment of capital leases							$ 1,000,000
Monthly payments for capital leases							$ 172,000
Common stock awarded as a part of bankruptcy proceedings (in shares) | shares	10,820
Recorded distribution				0		0
Amount received						155,000
Lease payments				0
Investments in unconsolidated entities		$ 0	0	$ 0	0
FOP [Member] | Maximum [Member]
Florida Oncology Partners [Abstract]
Amount of guarantee obligation								$ 1,433,000
FOP [Member] | Office Space [Member]
Florida Oncology Partners [Abstract]
Lease term		10 years		10 years
Loan amount									$ 4,106,000
Debt maturity period				7 years
Outstanding Loan		$ 2,819,000		$ 2,819,000		3,066,000
FOP [Member] | Radiation Therapy Center [Member]
Florida Oncology Partners [Abstract]
Lease term		10 years		10 years
Lease obligation										$ 14,321,000
Monthly payments for capital leases	$ 160,000	$ 170,000		$ 170,000
Maximum number of additional terms extended | Term				3
Extension of agreement				5 years
Percentage of increase of monthly payments each year				2.00%
FOP [Member] | Letter of Credit [Member] | Office Space [Member]
Florida Oncology Partners [Abstract]
Letter of credit, amount		$ 88,000		$ 88,000
FOP [Member] | USNC [Member]
Florida Oncology Partners [Abstract]
Ownership percentage		24.00%		24.00%
FOP [Member] | Investment in Unconsolidated Entity [Member]
Condensed Income Statement Information [Abstract]
Income		$ 0	0	$ 0	0
Net loss		(44,000)	(44,000)	(133,000)	(7,000)
USNC's equity in (loss) earnings		(9,000)	$ (11,000)	(30,000)	$ (2,000)
Condensed Balance Sheet Information [Abstract]
Current assets		5,000		5,000		7,000
Noncurrent assets		1,001,000		1,001,000		1,091,000
TOTAL ASSETS		1,006,000		1,006,000		1,098,000
Current liabilities		4,211,000		4,211,000		4,068,000
Noncurrent liabilities		870,000		870,000		969,000
Deficit		(4,075,000)		(4,075,000)		(3,939,000)
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY		$ 1,006,000		$ 1,006,000		1,098,000
21st Century Oncology [Member]
Florida Oncology Partners [Abstract]
Recorded distribution						$ 158,000

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Boca Oncology Partners (Details)	1 Months Ended		3 Months Ended		9 Months Ended
	Jun. 30, 2012	Jun. 30, 2011 USD ($)	Sep. 30, 2021 USD ($) ft²	Sep. 30, 2020 USD ($)	Sep. 30, 2021 USD ($) ft²	Sep. 30, 2020 USD ($)	Dec. 31, 2020 USD ($)
Boca Oncology Partners [Abstract]
Recorded investments			$ 152,000		$ 152,000		$ 160,000
Condensed Income Statement Information [Abstract]
Rental income						$ 7,000
USNC's equity in earnings (loss)			(77,000)	$ (56,000)	(350,000)	(292,000)
Condensed Balance Sheet Information [Abstract]
Current assets			2,634,000		2,634,000		3,007,000
TOTAL ASSETS			3,772,000		3,772,000		4,173,000
Current liabilities			419,000		419,000		410,000
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY			$ 3,772,000		$ 3,772,000		$ 4,173,000
USNC [Member] | Boca West IMP [Member]
Boca Oncology Partners [Abstract]
Share of guarantee in mortgage			10.00%		10.00%
Share of guarantee in outstanding mortgage			50.00%		50.00%
Mortgage term of guarantee					10 years
Original balance of mortgage			$ 3,000,000		$ 3,000,000
Boca Oncology Partners, LLC [Member]
Boca Oncology Partners [Abstract]
Area of real estate property (in square foot) | ft²			6,000		6,000
Boca Oncology Partners RE, LLC ("BOPRE") [Member]
Boca Oncology Partners [Abstract]
Ownership percentage			21.22%		21.22%		21.22%
Recorded investments			$ 149,000		$ 149,000		$ 134,000
Boca Oncology Partners RE, LLC ("BOPRE") [Member] | Boca West IMP [Member]
Boca Oncology Partners [Abstract]
Percentage of interest in medical office building		20.00%
Ownership percentage	23.75%
Additional investor purchased ownership percentage	3.75%
Boca Oncology Partners RE, LLC ("BOPRE") [Member] | Investment in Unconsolidated Entity [Member]
Condensed Income Statement Information [Abstract]
Rental income			0	0	0	0
Net income			19,000	30,000	75,000	37,000
USNC's equity in earnings (loss)			4,000	$ 7,000	16,000	$ 8,000
Condensed Balance Sheet Information [Abstract]
Current assets			101,000		101,000		27,000
Noncurrent assets			757,000		757,000		757,000
TOTAL ASSETS			858,000		858,000		784,000
Current liabilities			0		0		0
Noncurrent liabilities			0		0		0
Equity			858,000		858,000		784,000
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY			$ 858,000		$ 858,000		$ 784,000
BOP and BOPRE [Member]
Boca Oncology Partners [Abstract]
Area of real estate property (in square foot) | ft²			32,000		32,000
Investments in unconsolidated entities		$ 225,000
Ownership percentage		22.50%

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Medical Oncology Partners (Details) - USD ($)		3 Months Ended		9 Months Ended		12 Months Ended
	Dec. 31, 2016	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020	Dec. 23, 2016
Medical Oncology Partners [Abstract]
Carrying value of investment		$ 152,000		$ 152,000		$ 160,000
Advances to unconsolidated entities				374,000	$ 337,000
Condensed Consolidated Income Statement Information [Abstract]
Patient revenue		0	$ 662,000	1,061,000	2,005,000
USNC's equity in (loss) earnings		(77,000)	(56,000)	(350,000)	(292,000)
Condensed Consolidated Balance Sheet Information [Abstract]
Current assets		2,634,000		2,634,000		3,007,000
TOTAL ASSETS		3,772,000		3,772,000		4,173,000
Current liabilities		419,000		419,000		410,000
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY		3,772,000		$ 3,772,000		4,173,000
Medical Oncology Partners LLC [Member]
Medical Oncology Partners [Abstract]
Equity interest percentage to be acquired by subsidiary				100.00%
Investments in unconsolidated entities				$ 450,000
Advances to unconsolidated entities				342,000
Condensed Consolidated Income Statement Information [Abstract]
USNC's equity in (loss) earnings	$ (12,000)					(686,000)
Medical Oncology Partners LLC [Member] | Other Investor [Member]
Medical Oncology Partners [Abstract]
Investments in unconsolidated entities				105,000
Medical Oncology Partners LLC [Member] | USNC [Member]
Medical Oncology Partners [Abstract]
Investments in unconsolidated entities				173,000
Ownership percentage							35.83%
Carrying value of investment		$ 149,000		149,000			$ 161,000
Medical Oncology Partners LLC [Member] | USNC [Member] | Dr. Jaime Lozano [Member]
Medical Oncology Partners [Abstract]
Investments in unconsolidated entities				$ 345,000
Ownership percentage		76.67%		76.67%
Percentage of equity interest to an additional investor as a consulting fee for services				5.00%
Medical Oncology Partners LLC [Member] | Investment in Unconsolidated Entity [Member]
Condensed Consolidated Income Statement Information [Abstract]
Patient revenue		$ 532,000	541,000	$ 1,601,000	1,473,000
Net loss		(185,000)	(345,000)	(280,000)	(1,041,000)
USNC's equity in (loss) earnings		(66,000)	$ (124,000)	(100,000)	$ (373,000)
Condensed Consolidated Balance Sheet Information [Abstract]
Current assets		284,000		284,000		204,000
Noncurrent assets		466,000		466,000		701,000
TOTAL ASSETS		750,000		750,000		905,000
Current liabilities		3,161,000		3,161,000		2,736,000
Noncurrent liabilities		135,000		135,000		410,000
Deficit		(2,546,000)		(2,546,000)		(2,241,000)
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY		$ 750,000		$ 750,000		$ 905,000

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CB Oncology Partners (Details) - USD ($)	1 Months Ended	3 Months Ended		9 Months Ended
	Jun. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020	Sep. 02, 2017
Condensed Income Statement Information [Abstract]
Patient revenue		$ 0	$ 662,000	$ 1,061,000	$ 2,005,000
USNC's equity in earnings (loss)		(77,000)	(56,000)	(350,000)	(292,000)
Condensed Balance Sheet Information [Abstract]
Current assets		2,634,000		2,634,000		$ 3,007,000
TOTAL ASSETS		3,772,000		3,772,000		4,173,000
Current liabilities		419,000		419,000		410,000
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY		3,772,000		3,772,000		4,173,000
CB Oncology Partners LLC [Member]
CB Oncology Partners [Abstract]
Ownership percentage	28.58%						24.00%
Capital called from members	$ 500,000
Advances converted into equity	121,000
Contribution in cash	$ 212,000
Outstanding amount		2,165,000		2,165,000		2,154,000
Outstanding amount, less allowances		1,251,000		1,251,000		1,251,000
Due from related parties		$ 914,000		$ 914,000		903,000
Note bearing interest		6.00%		6.00%
Interest earned from the amounts owed by entity				$ 93,000	94,000
Accrued interest		$ 366,000		366,000		273,000
CB Oncology Partners LLC [Member] | Investment in Unconsolidated Entity [Member]
Condensed Income Statement Information [Abstract]
Patient revenue		550,000	466,000	1,591,000	1,360,000
Net income (loss)		(23,000)	(165,000)	69,000	(565,000)
USNC's equity in earnings (loss)		(7,000)	$ (48,000)	20,000	$ (148,000)
Condensed Balance Sheet Information [Abstract]
Current assets		591,000		591,000		385,000
Noncurrent assets		3,818,000		3,818,000		4,271,000
TOTAL ASSETS		4,409,000		4,409,000		4,656,000
Current liabilities		3,271,000		3,271,000		3,181,000
Noncurrent liabilities		3,266,000		3,266,000		3,684,000
Deficit		(2,128,000)		(2,128,000)		(2,209,000)
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY		$ 4,409,000		$ 4,409,000		$ 4,656,000

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Income Taxes (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Income Taxes [Abstract]
Federal and state income taxes, rate			115.00%	28.00%
Tax charge	$ 8,000	$ 75,000	$ 202,000	$ 148,000

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Subsequent Event (Details)	1 Months Ended
	Oct. 19, 2021
Subsequent Event [Member] | Elite Health Plan, Inc. [Member]
Subsequent Event [Abstract]
Equity consideration, percentage of outstanding shares	15.00%