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COVID-19 PANDEMIC
 9 Months Ended
Sep. 30, 2021
Unusual or Infrequent Items, or Both [Abstract]  
COVID-19 PANDEMIC COVID-19 PANDEMICAs of September 30, 2021, the Company has received $51,607 from the PHSSEF. The Company recognized $2,344 and $9,563 as income for the three month periods ended September 30, 2021 and 2020, respectively, and $21,335 and $14,711 for the nine months ended September 30, 2021 and 2020, respectively, which is reflected in "other operating income" in the Company's results of operations. For the nine months ended September 30, 2021 and 2020, the Company utilized $954 and $898, respectively, of these stimulus dollars to fund capital improvements to prevent the spread of COVID-19. The remaining
stimulus funds of $8,174 and $25,900 as of September 30, 2021 and December 31, 2020, respectively, are classified as "deferred income" on the consolidated balance sheet.
The Nursing Home Infection Control Distributions, which also include infection control quality incentive payments, are subject to terms and conditions that require recipients to use the funds for infection control expenses. HHS issued guidance in June 2021 that set forth deadlines for using and reporting on the use of PHSSEF funds, including Nursing Home Infection Control Distributions, which depend on the time periods in which the PHSSEF funds were received.
The Company recognized $877 of grant funds from states, which is included in "other operating income" in the Company's results of operations for the nine month period ended September 30, 2021. Additionally, the Families First Coronavirus Response Act provided states with a temporary increase in the regular federal matching rate, or federal medical assistance percentage, used to determine the federal government's share of the cost of covered services in state Medicaid programs, provided the states agreed to certain conditions such as not imposing cost-sharing requirements for COVID-19-related testing and treatment. The Company recognized $5,038 and $6,645 for the three month periods ended September 30, 2021 and 2020, respectively, of Medicaid and Hospice dollars related to this temporary increase in the federal matching rate, which related to patient services rendered and is reflected in "patient revenues, net" in the Company's results of operations. The Company recognized $14,909 and $11,709, for the nine month periods ended September 30, 2021 and 2020, respectively, of Medicaid and Hospice dollars, which related to patient services rendered and is reflected in "patient revenues, net" in the Company's results of operations.
The CARES Act and other stimulus legislation also include other provisions offering financial relief, for example lifting the Medicare sequestration from May 1, 2020 through December 31, 2021, which would have otherwise reduced payments to Medicare providers by 2% as required by the Budget Control Act of 2011 (but also extending sequestration through 2030). For the three month periods ended September 30, 2021 and 2020, the suspension of the Medicare sequestration positively impacted net patient revenues by $644 and $724, respectively, and $2,004 and $1,031 for the nine month periods ended September 30, 2021 and 2020, respectively. However, in addition to providing funding for healthcare providers, the ARPA increases the federal budget deficit in a manner that triggers an additional statutorily mandated sequestration under the Pay-As-You-Go Act of 2010 ("PAYGO Act"). As a result, absent congressional action, Medicare spending will be reduced by up to 4% in FY 2022, to begin to take effect in January 2022, in addition to the existing sequestration requirements of the Budget Control Act of 2011.
The Company incurred an additional $6,018 and $8,241 of labor expense for the three month periods ended September 30, 2021 and 2020, respectively, and $1,152 and $4,430 for testing and the increased costs of personal protective equipment, food and infection control supplies related to the COVID-19 pandemic for the three month period ended September 30, 2021 and 2020, respectively. The Company incurred an additional $19,847 and $11,349 of labor expense for the nine month periods ended September 30, 2021 and 2020, respectively, and $5,731 and $5,642 for testing and the increased costs of personal protective equipment, food and infection control supplies related to the COVID-19 pandemic for the nine month periods ended September 30, 2021 and 2020, respectively. These expenses are reflected in "operating expense" in the Company's results of operations for the three and nine month periods ended September 30, 2021.
The Company is closely monitoring and evaluating the impact of the COVID-19 pandemic on all aspects of its business. We have identified team members and patients who have tested positive for COVID-19 at all of our centers, and we have incurred an increase in the costs of caring for the team members, patients, and residents in those centers. The Company has also experienced reduced occupancy at its centers and has incurred additional expenditures preparing its centers for potential outbreaks and maintaining the healthcare delivery capacity of its centers. While we have experienced reduced occupancy and increased expenses, we received additional PHSSEF and other stimulus funds during 2020 and 2021, which have been used, and are expected to continue to be used to mitigate the impact of COVID-19 derived lost revenues associated with the reduced occupancy as well as increased expenses, and any cash flow or liquidity impacts therefrom.
The Company has an interdisciplinary team monitoring and staying up to date on the latest information about COVID-19. The Company understands that President Biden has tasked CMS with issuing guidance and/or promulgating setting forth vaccine requirements for certain employees that may be applicable to the Company, and the Company intends to fully comply with that guidance. The Company has implemented precautionary measures and response protocols to minimize the spread of COVID-19, following the current guidance from CMS, the CDC, and state and local governments. The Company also intends to fully comply with the forthcoming Occupational Safety and Health Administration ("OSHA") Emergency Temporary Standard ("ETS") as applicable. Nevertheless, the Company expects additional COVID-19 cases will occur at its centers. The Company is continuing to evaluate and consider the potential impact that COVID-19 may have on its liquidity, financial condition and results of operations due to numerous uncertainties, including the duration of the COVID-19 pandemic and the timing, availability and adoption of effective medical treatment and vaccines. These and other factors relating to the COVID-19 pandemic could have a material adverse effect on the Company's future results of operations, financial condition and liquidity.