Commitments and Contingencies

12 Months Ended

Dec. 31, 2014

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

Note 11 – Commitments and Contingencies

Legal Issues – The Company is exposed to asserted and unasserted legal claims encountered in the normal course of business, including claims for damages for personal injuries, medical malpractice, breach of contracts, wrongful restriction of or interference with physicians’ staff privileges and employment related claims.  In certain of these actions, plaintiffs request payment for damages, including punitive damages that may not be covered by insurance.  Management believes that the ultimate resolution of these matters will not have a material adverse effect on the operating results or the financial position of the Company.  During the years ended December 31, 2014 and 2013, the Company did not incur any settlement expenses related to its ongoing asserted and unasserted legal claims.

Operating Leases – The Company leases all of the real property used in its business for office space, surgical hospital facilities and certain medical equipment under operating lease agreements.  Rent expense for leases that contain scheduled rent increases is recognized on a straight-line basis over the lease term (“Deferred Rent”).  As of December 31, 2014 and 2013, the Company had Deferred Rent of $3,930,325 and $6,648,369, respectively, which is included in other liabilities in the accompanying consolidated balance sheets.  In addition to minimum lease payments, certain leases require reimbursement for common area maintenance and insurance, which are expensed when incurred.

The Company’s rental expense, net of sublease income, for operating leases in 2014 and 2013 was $9,933,563 and $7,112,362, respectively.

Following is a summary of the future minimum lease payments under operating leases as of December 31, 2014:

2015	$	11,675,379
2016		11,760,275
2017		11,826,286
2018		11,737,775
2019		11,431,044
Thereafter		84,661,254
Less: Sublease income		(3,457,542	)
Total	$	139,634,471

At December 31, 2014 and 2013, the Company had current and long-term deferred lease incentives of $9,555,581 and $5,563,984, respectively.  The lease incentives are included in current other liabilities and other liabilities the accompanying consolidated balance sheets and are amortized on a straight line basis over the life of the lease as a reduction in rent expense.

Self-insurance – Effective January 1, 2014, the Company began using a combination of insurance and self-insurance for employee-related healthcare benefits. The self-insurance liability is determined actuarially, based on the actual claims filed and an estimate of incurred but not reported claims. Self-insurance reserves as of December 31, 2014 were $560,851 and are included in accrued liabilities in the accompanying consolidated balance sheets.