ACCOUNTS RECEIVABLE, NET

12 Months Ended

Dec. 31, 2018

ACCOUNTS RECEIVABLE, NET

ACCOUNTS RECEIVABLE, NET

NOTE C — ACCOUNTS RECEIVABLE, NET

Accounts receivable, net represents outstanding amounts we expect to collect from the transfer of our products and services.  Principally, these amounts are comprised of receivables from Medicare, Medicaid, and commercial insurance plans.  Under ASC 606, our accounts receivable represent amounts outstanding from our gross billings, net of contractual discounts and other implicit price concessions including estimates for payor disallowances, sales returns, and patient non-payments.

Under both ASC 606 and ASC 605, disallowed revenue is considered an adjustment to the transaction price.  However, upon adoption of ASC 606, estimated uncollectible amounts due to us by patients are generally considered implicit price concessions and are now presented as a reduction of net revenue.  Under prior guidance, these amounts were recognized as bad debt expense in other operating costs.

An allowance for doubtful accounts is also recorded for our Products & Services segment which is deducted from gross accounts receivable to arrive at “Accounts receivable, net.”  Accounts receivable, net as of December 31, 2018 and 2017 is comprised of the following:

	As of December 31, 2018						As of December 31, 2017
			Products &						Products &
(in thousands)	PatientCare		Services		Consolidated		Patient Care		Services		Consolidated
Accounts receivable, before allowances	$	182,338	$	24,542	$	206,880	$	193,150	$	23,494	$	216,644
Allowances for estimated implicit price concessions arising from:
Payor disallowances		(53,378)		—		(53,378)		(56,233)		—		(56,233)
Patient non-payments		(7,244)		—		(7,244)		—		—		—
Accounts receivable, gross		121,716		24,542		146,258		136,917		23,494		160,411
Allowance for doubtful accounts		—		(2,272)		(2,272)		(9,894)		(4,171)		(14,065)
Accounts receivable, net	$	121,716	$	22,270	$	143,986	$	127,023	$	19,323	$	146,346

Approximately 48.4% and 49.2% of accounts receivable, before allowances, is due from the Federal Government (Medicare, Medicaid, and U.S. Veterans Affairs) at December 31, 2018 and 2017, respectively.

The following table summarizes activities by year for implicit price concessions and the allowance for doubtful accounts:

	Payor Disallowances		Allowance for
	and Patient Non-		Doubtful
(in thousands)	Payments		Accounts
Balance at December 31, 2015	$	81,306	$	15,027
Additions		48,961		13,727
Reductions		(69,130)		(13,233)
Balance at December 31, 2016		61,137		15,521
Additions		36,962		9,423
Reductions		(41,866)		(10,879)
Balance at December 31, 2017		56,233		14,065
Cumulative Effect of ASC 606		9,894		(9,894)
Additions		42,653		630
Reductions		(48,158)		(1,155)
Recoveries		—		(1,374)
Balance at December 31, 2018	$	60,622	$	2,272

The following tables represent accounts receivable, before allowances, by major payor classification and by aging categories reduced by implicit price concessions and allowance for doubtful accounts to accounts receivable, net as of December 31, 2018 and 2017, respectively:

December 31, 2018	0-60		61-120		121-180		Over 180
(in thousands)	Days		Days		Days		Days		Total
Patient Care
Commercial insurance (excluding Medicare and Medicaid Managed Care)	$	44,918	$	11,495	$	6,467	$	17,172	$	80,052
Private pay		951		437		343		483		2,214
Medicaid		12,690		2,964		1,855		6,629		24,138
VA		4,786		859		526		784		6,955
Non-Medicare		63,345		15,755		9,191		25,068		113,359
Medicare		32,339		5,483		3,002		28,155		68,979
Products & Services		14,768		6,507		1,641		1,626		24,542
Accounts receivable, before allowances		110,452		27,745		13,834		54,849		206,880
Allowance for disallowed revenue and patient non-payment										(60,622)
Allowance for doubtful accounts										(2,272)
Accounts receivable, net									$	143,986

December 31, 2017	0-60		61-120		121-180		Over 180
(in thousands)	Days		Days		Days		Days		Total
Patient Care
Commercial insurance (excluding Medicare and Medicaid Managed Care)	$	50,310	$	11,649	$	6,302	$	15,279	$	83,540
Private pay		880		447		381		1,311		3,019
Medicaid		13,785		3,561		1,832		5,684		24,862
VA		4,578		1,193		552		694		7,017
Non-Medicare		69,553		16,850		9,067		22,968		118,438
Medicare		34,197		5,725		3,396		31,394		74,712
Products & Services		14,316		5,075		1,219		2,884		23,494
Accounts receivable, before allowances		118,066		27,650		13,682		57,246		216,644
Allowance for disallowed revenue										(56,233)
Allowance for doubtful accounts										(14,065)
Accounts receivable, net									$	146,346