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Electronic Health Records Incentive Reimbursement Receivable
3 Months Ended
Sep. 30, 2011
Electronic Health Records Incentive Reimbursement Receivable [Abstract] 
Electronic Health Records Incentive Reimbursement Receivable

Note 6. – Electronic Health Records Incentive Reimbursement

Included in net revenues for the three months ended September 30, 2011 was Electronic Health Records ("EHR") incentive reimbursement ("EHR Revenue") of approximately $1,683 and $1,315 for Medicare and Medicaid, respectively. EHR Revenue is attributable to the Health Information Technology for Economic and Clinical Health Act (the "HITECH Act") which was enacted into law on February 17, 2009 as part of the American Recovery and Reinvestment Act of 2009 ("ARRA"). The HITECH Act includes provisions designed to increase the use of Electronic Health Records by both physicians and hospitals. Beginning with federal fiscal year 2011 and extending through federal fiscal year 2016, eligible hospitals and critical access hospitals ("CAH") participating in the Medicare and Medicaid programs are eligible for reimbursement incentives based on successfully demonstrating meaningful use of their certified EHR technology. Conversely, those hospitals that do not successfully demonstrate meaningful use of EHR technology are subject to payment penalties or downward adjustments to their Medicare payments beginning in FY 2015. On July 13, 2010, the Department of Health and Human Services ("DHHS") released final meaningful use regulations. Meaningful use criteria are divided into three distinct stages: I, II and III. The final rules specify the initial criteria for: physicians, eligible hospitals, and CAHs necessary to qualify for incentive payments; calculation of the incentive payment amounts; payment adjustments under Medicare for covered professional services and inpatient hospital services; and other program participation requirements.

At September 30, 2011, SunLink accrued the estimated Medicare EHR Revenue for its six operating hospitals for the three months ended September 30, 2011 and accrued an estimate for Chilton (see Note 3). The total Medicare EHR Revenue for SunLink's six hospitals was $1,439 and $244 for Chilton. Recorded in Medicare EHR receivable as of September 30, 2011 was $660 for the six hospitals and $184 for Chilton. The Medicare EHR receivable at September 30, 2011 is the difference between the reimbursement actually received from Medicare and the Medicare EHR Revenue estimated by SunLink. Final settlement of these amounts will be determined upon settlement of the cost report for the fiscal year ended June 30, 2012.

 

The Company also accrued Medicaid EHR Revenue for its six operating hospitals for the three months ended September 30, 2011 and accrued an estimate for Chilton. The total Medicaid EHR Revenue for SunLink's six hospitals was $1,268 and $47 for Chilton. The amounts accrued are the estimates of the incentive payments earned for the periods through September 30, 2011. Recorded in Medicaid EHR receivable as of September 30, 2011 was $1,545 for the six hospitals and $188 for Chilton.