10. LEASES

The Company leases hospitals, medical office buildings, and certain equipment under capital and operating lease agreements. During 2017, 2016 and 2015, the Company entered into capital lease obligations of $31 million, $179 million and $50 million, respectively. All lease agreements generally require the Company to pay maintenance, repairs, property taxes and insurance costs.

Commitments relating to noncancellable operating and capital leases for each of the next five years and thereafter are as follows (in millions):



Year Ending December 31,	Operating (1)		Capital

2018	$	208	$	32
2019		161		28
2020		130		23
2021		91		23
2022		70		22
Thereafter		246		299
Total minimum future payments	$	906		427
Less: Imputed interest				(123)
Total capital lease obligations				304
Less: Current portion				(17)
Long-term capital lease obligations			$	287

(1)Minimum lease payments have not been reduced by minimum sublease rentals due in the future of $6 million.

On December 22, 2016, the Company completed the sale and leaseback of ten medical office buildings for net proceeds of $159 million to HCP, Inc. The buildings, with a combined total of 756,183 square feet, are located in five states and support a wide array of diagnostic, medical and surgical services in an outpatient setting for the respective nearby hospitals. Because of the Company’s continuing involvement in these leased buildings, the transaction does not qualify for sale treatment and the related leases have been recorded as financing obligations in the Company’s consolidated balance sheet at December 31, 2017. Such financing obligations are included with the capital lease obligations discussed throughout these footnotes to the consolidated financial statements.

Assets capitalized under capital leases as reflected in the accompanying consolidated balance sheets were $63 million of land and improvements, $774 million of buildings and improvements and $28 million of equipment and fixtures as of December 31, 2017 and $69 million of land and improvements, $826 million of buildings and improvements and $56 million of equipment and fixtures as of December 31, 2016. The accumulated depreciation related to assets under capital leases was $218 million and $240 million as of December 31, 2017 and 2016, respectively. Depreciation of assets under capital leases is included in depreciation and amortization expense and amortization of debt discounts on capital lease obligations is included in interest expense in the accompanying consolidated statements of (loss) income.