ACCOUNTS RECEIVABLE

3 Months Ended

Mar. 31, 2020

Accounts Receivable Additional Disclosures [Abstract]

The principal components of accounts receivable are shown in the table below:



	March 31, 2020		December 31, 2019
Continuing operations:
Patient accounts receivable	$	2,521	$	2,567
Estimated future recoveries	163		162
Net cost reports and settlements receivable and valuation allowances	37		12
	2,721		2,741
Discontinued operations	1		2
Accounts receivable, net	$	2,722	$	2,743

Accounts that are pursued for collection through Conifer’s business offices are maintained on our hospitals’ books and reflected in patient accounts receivable. Patient accounts receivable, including billed accounts and certain unbilled accounts, as well as estimated amounts due from third-party payers for retroactive adjustments, are recognized as receivables if our right to consideration is unconditional and only the passage of time is required before payment of that consideration is due. Estimated uncollectable amounts are generally considered implicit price concessions that are a direct reduction to patient accounts receivable rather than allowance for doubtful accounts.

We had $257 million and $284 million of receivables recorded in other current assets and investments and other assets, respectively, and $126 million and $65 million of payables recorded in other current liabilities and other long-term liabilities, respectively, in the accompanying Condensed Consolidated Balance Sheet at March 31, 2020 related to California’s provider fee program. We had $316 million and $213 million of receivables recorded in other current assets and investments and other assets, respectively, and $115 million and $57 million of payables recorded in other current liabilities and other long-term liabilities, respectively, in the accompanying Condensed Consolidated Balance Sheet at December 31, 2019 related to California’s provider fee program.

We also provide financial assistance through our charity and uninsured discount programs to uninsured patients who are unable to pay for the healthcare services they receive. Our policy is not to pursue collection of amounts determined to qualify for financial assistance; therefore, we do not report these amounts in net operating revenues. Most states include an estimate of the cost of charity care in the determination of a hospital’s eligibility for Medicaid disproportionate share hospital

(“DSH”) payments. These payments are intended to mitigate our cost of uncompensated care. Some states have also developed provider fee or other supplemental payment programs to mitigate the shortfall of Medicaid reimbursement compared to the cost of caring for Medicaid patients.

The following table shows our estimated costs (based on selected operating expenses, which include salaries, wages and benefits, supplies and other operating expenses) of caring for our uninsured and charity patients in the three months ended March 31, 2020 and 2019:



	Three Months Ended March 31,
	2020		2019
Estimated costs for:
Uninsured patients	$	156	$	158
Charity care patients	40		34
Total	$	196	$	192