11. HOSPITAL QUALITY ASSURANCE FEES (QAF)	3 Months Ended
Jun. 30, 2012
Notes to Financial Statements
NOTE 11 - HOSPITAL QUALITY ASSURANCE FEES ("QAF")	In October 2009, the Governor of California signed legislation supported by the hospital industry to impose a provider fee on general acute care hospitals that, combined with federal matching funds, would be used to provide supplemental Medi-Cal payments to hospitals. The state submitted the plan to the Centers for Medicare and Medicaid Services (“CMS”) for a required review and approval process, and certain changes in the plan were required by CMS. Legislation amending the fee program to reflect the required changes was passed by the legislature and signed by the Governor on September 8, 2010. Among other changes, the legislation leaves distribution of “pass-through” payments received by Medi-Cal managed care plans that will be paid to hospitals under the program to the discretion of the plans. The hospital quality assurance fee program (“QAF”) created by this legislation initially provided payments for up to 21 months retroactive to April 2009 and expiring on December 31, 2010 (“2010 QAF”). In February 2011, CMS gave final approval for the 2010 QAF. In December 2011, CMS gave final approval for the extension of the QAF for the six month period from January 1 through June 30, 2011 (“2011 QAF”). During fiscal year 2012, the Company recognized $31.9 million in revenue and recorded expenses of $15.9 million relating to the 2011 QAF. During fiscal year 2011, the Company recognized $87.2 million in revenue and recorded expenses of $47.8 million relating to the 2010 QAF. In June 2012, CMS conditionally approved the extension of the QAF for the thirty month period from July 1, 2011 through December 31, 2013 (“2013 QAF”). Based on the most recent modeling prepared by the California Hospital Association, the Company anticipates making payments for provider fees and other expenses relating to the 2013 QAF of approximately $105.8 million and receiving approximately $235.5 million in revenues from the state ($79.4 million from the fee-for-service portion and $156.1 million from the managed care portion). No amounts have been recognized relating to the 2013 QAF pending resolution of CMS conditions of approval. The Company cannot provide any assurances or estimates in connection with CMS’s final approval of the 2013 QAF or a possible continuation of the QAF program beyond December 31, 2013.

11. HOSPITAL QUALITY ASSURANCE FEES (QAF)

3 Months Ended

Jun. 30, 2012

NOTE 11 - HOSPITAL QUALITY ASSURANCE FEES ("QAF")

In October 2009, the Governor of California signed legislation supported by the hospital industry to impose a provider fee on general acute care hospitals that, combined with federal matching funds, would be used to provide supplemental Medi-Cal payments to hospitals. The state submitted the plan to the Centers for Medicare and Medicaid Services (“CMS”) for a required review and approval process, and certain changes in the plan were required by CMS. Legislation amending the fee program to reflect the required changes was passed by the legislature and signed by the Governor on September 8, 2010. Among other changes, the legislation leaves distribution of “pass-through” payments received by Medi-Cal managed care plans that will be paid to hospitals under the program to the discretion of the plans.

The hospital quality assurance fee program (“QAF”) created by this legislation initially provided payments for up to 21 months retroactive to April 2009 and expiring on December 31, 2010 (“2010 QAF”). In February 2011, CMS gave final approval for the 2010 QAF. In December 2011, CMS gave final approval for the extension of the QAF for the six month period from January 1 through June 30, 2011 (“2011 QAF”).

During fiscal year 2012, the Company recognized $31.9 million in revenue and recorded expenses of $15.9 million relating to the 2011 QAF. During fiscal year 2011, the Company recognized $87.2 million in revenue and recorded expenses of $47.8 million relating to the 2010 QAF.

In June 2012, CMS conditionally approved the extension of the QAF for the thirty month period from July 1, 2011 through December 31, 2013 (“2013 QAF”). Based on the most recent modeling prepared by the California Hospital Association, the Company anticipates making payments for provider fees and other expenses relating to the 2013 QAF of approximately $105.8 million and receiving approximately $235.5 million in revenues from the state ($79.4 million from the fee-for-service portion and $156.1 million from the managed care portion). No amounts have been recognized relating to the 2013 QAF pending resolution of CMS conditions of approval.

The Company cannot provide any assurances or estimates in connection with CMS’s final approval of the 2013 QAF or a possible continuation of the QAF program beyond December 31, 2013.