PART I, LINE 7, COLUMN (F) - EXCLUSIONS FROM PERCENT OF TOTAL EXPENSE
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NO BAD DEBT EXPENSE IS INCLUDED ON FORM 990, PART IX, LINE 25, COLUMN (A) AS BAD DEBT EXPENSE OF 492,327 IS REPORTED WITH NET PATIENT SERVICE REVENUE ON FORM 990, PART VIII, LINE 2.A., CONSISTENT WITH FINANCIAL STATEMENTS.
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PART I, LINE 7 - COSTING METHODOLOGY EXPLANATION
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THE COSTING METHODOLOGY USED TO CALCULATE THE AMOUNTS REPORTED IN THE TABLE WAS A COST TO CHARGE RATIO.
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PART II - COMMUNITY BUILDING ACTIVITIES
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COMMUNITY-BUILDING ACTIVITIES INCLUDE PROGRAMS THAT ADDRESS THE ROOT CAUSES OF HEALTH PROBLEMS, SUCH AS POVERTY, HOMELESSNESS, AND ENVIRONMENTAL PROBLEMS. THE ORGANIZATION PROVIDED 5,000 TO FALLS CITY ECONMIC DEVELOPMENT AND GROWTH ENTERPRISE (EDGE) TO SUPPORT ECONOMIC DEVELOPMENT IN FALLS CITY AND RICHARDSON COUNTY. THE ORGANIZATION FUNDED 5,000 TO THE BALL FIELD PROJECT AND 2,500 TO THE MAIN STREET PROJECT IN SUPPORT OF TWO COMMUNITY IMPROVEMENT AND REVITALIZATION PROJECTS. THE ORGANIZATION ALSO CONTRIBUTED 5,000 TO SACRED HEART - PROJECT RENEW 125. THE ORGANIZATION ALSO CONTRIBUTED 2,375 TO VARIOUS HEALTH-ORIENTED ACTIVITIES AND SCHOOL PROJECTS DURING THE YEAR.
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PART III, LINE 2 - BAD DEBT EXPENSE METHODOLOGY
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OVERALL COST TO CHARGE RATIO WAS USED TO DETERMINE AMOUNTS REPORTED ON SCHEDULE H, PART III, LINE 2. BAD DEBT EXPENSE REPORTED ON FORM 990, PART VIII, LINE 2A WAS 492,327.
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PART III, LINE 3 BAD DEBT EXPENSE, PATIENTS ELIGIBLE FOR ASSISTANCE
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AFTER REVIEW OF BAD DEBTS WRITTEN OFF IT WAS DETERMINED APPROXIMATELY 10% OF BAD DEBT ACCOUNTS WRITTEN OFF WOULD HAVE QUALIFIED FOR CHARITY CARE IF THE INDIVIDUALS WOULD HAVE COMPLETED THE APPLICATION PROCESS. RATIONALE FOR INCLUDED BAD DEBT AS A COMMUNITY BENEFIT - BY LAW, THE ORGANIZATION CANNOT REFUSE CERTAIN SERVICES TO PATIENTS, REGARDLESS OF THEIR ABILITY TO PAY, THUS BAD DEBT SHOULD BE INCLUDED AS A COMMUNITY BENEFIT.
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BAD DEBT EXPENSE FOOTNOTE TO FINANCIAL STATEMENTS
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ACCOUNTS RECEIVABLE ARE REDUCED BY AN ALLOWANCE FOR DOUBTFUL ACCOUNTS. IN EVALUATING THE COLLECTABILITY OF ACCOUNTS RECEIVABLE, THE MEDICAL CENTER ANALYZES ITS PAST HISTORY AND IDENTIFIES TRENDS FOR EACH OF ITS MAJOR PAYOR SOURCES OF REVENUE TO ESTIMATE THE APPROPRIATE ALLOWANCE FOR DOUBTFUL ACCOUNTS AND PROVISION FOR BAD DEBTS. MANAGEMENT REGULARLY REVIEWS DATA ABOUT THESE MAJOR PAYOR SOURCES OF REVENUE IN EVALUATING THE SUFFICIENCY OF THE ALLOWANCE FOR DOUBTFUL ACCOUNTS. FOR RECEIVABLES ASSOCIATED WITH SERVICES PROVIDED TO PATIENTS WHO HAVE THIRD-PARTY COVERAGE, THE MEDICAL CENTER ANALYZES CONTRACTUALLY DUE AMOUNTS AND PROVIDES AN ALLOWANCE FOR DOUBTFUL ACCOUNTS AND A PROVISION FOR BAD DEBTS, IF NECESSARY (FOR EXAMPLE, FOR EXPECTED UNCOLLECTIBLE DEDUCTIBLES AND COPAYMENTS ON ACCOUNTS FOR WHICH THE THIRD-PARTY PAYOR HAS NOT YET PAID, OR FOR PAYORS WHO ARE KNOWN TO BE HAVING FINANCIAL DIFFICULTIES THAT MAKE THE REALIZATION OF AMOUNTS DUE UNLIKELY). FOR RECEIVABLES ASSOCIATED WITH UNINSURED/SELF-PAY PATIENTS (WHICH INCLUDES BOTH PATIENTS WITHOUT INSURANCE AND PATIENTS WITH DEDUCTIBLE AND COPAYMENT BALANCES DUE FOR WHICH THIRD-PARTY COVERAGE EXISTS FOR PART OF THE BILL), THE MEDICAL CENTER RECORDS A SIGNIFICANT PROVISION FOR BAD DEBTS IN THE PERIOD OF SERVICE ON THE BASIS OF ITS PAST EXPERIENCE, WHICH INDICATES THAT MANY PATIENTS ARE UNABLE OR UNWILLING TO PAY THE PORTION OF THEIR BILL FOR WHICH THEY ARE FINANCIALLY RESPONSIBLE. AS A RESULT, THERE IS AT LEAST A REASONABLE POSSIBILITY THAT RECORDED ESTIMATES WILL CHANGE BY A MATERIAL AMOUNT IN THE NEAR TERM. THE DIFFERENCE BETWEEN THE STANDARD RATES (OR THE DISCOUNTED RATES IF NEGOTIATED) AND THE AMOUNTS ACTUALLY COLLECTED AFTER ALL REASONABLE COLLECTION EFFORTS HAVE BEEN EXHAUSTED IS CHARGED OFF AGAINST THE ALLOWANCE FOR DOUBTFUL ACCOUNTS. THE ALLOWANCE FOR DOUBTFUL ACCOUNTS FOR UNINSURED/SELF-PAY PATIENTS INCREASED FROM 556,000 AT JULY 31, 2013 TO 750,000 AT JULY 31, 2014 AS UNINSURED/SELF-PAY ACCOUNTS OVER 181 DAYS OUTSTANDING INCREASED OVER 56%.
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PART III, LINE 8 - MEDICARE EXPLANATION
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THE MEDICARE COST REPORT WAS USED TO DETERMINE THE AMOUNTS REPORTED ON LINE 6.
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PART VI, LINE 2 - NEEDS ASSESSMENT
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THE ORGANIZATION USES ITS CHNA TO ASSESS THE NEEDS OF THE COMMUNITY IT SERVICES.
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PART VI, LINE 3 - PATIENT EDUCATION OF ELIGIBILITY FOR ASSISTANCE
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THE ORGANIZATION INFORMS AND EDUCATES PATIENTS AND PERSONS WHO MAY BE BILLED FOR PATIENT CARE ABOUT THEIR ELIGIBILITY FOR ASSISTANCE UNDER THE ORGANIZATION'S HELPFUL OPTIONS FOR PATIENT EXPENSES (HOPE) PROGRAM OR FINANCIAL ASSISTANCE POLICY BY HAVING THE INFORMATION AVAILABLE ON THEIR WEBSITE, PROVIDING THE INFORMATION TO ALL WHO INQUIRE ABOUT OBTAINING FINANCIAL ASSISTANCE, AND BY REFERRING THOSE KNOWN TO BE UNINSURED AND/OR TO HAVE LOW INCOME TO FINANCIAL COUNSELORS WHO WILL DISCUSS THE POLICY.
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PART VI, LINE 4 - COMMUNITY INFORMATION
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RICHARDSON COUNTY, NEBRASKA IS PRIMARILY RURAL AND INCLUDES THE CITIES OF BARADA, DAWSON, FALLS CITY, HUMBOLDT, PRESTON, RULO, SALEM SHUBERT, STELLA, AND VERDON. IT IS LOCATED IN THE SOUTHEAST CORNER OF NEBRASKA. POPULATION ACCORDING TO THE 2010 CENSUS IS 8,363, DECLINING 12.3% FROM 2000. PERSONS 65 YEARS AND OLDER IS 23.2% WHILE PERSONS 18 AND YOUNGER IS 21.0%. ETHNIC BACKGROUDS BY PERCENT INCLUDE WHITE - 94.2%, AMERICAN INDIAN AND ALASKA NATIVE PERSONS - 3.3%, WITH ALL OTHERS REPORTING LESS THAN 2%. THERE ARE 3,782 HOUSEHOLDS WITH AN AVERAGE OF 2.15 PERSONS PER HOUSEHOLD. MEDIAN HOUSEHOLD INCOME IS 38,977 WITH 15.9% OF PERSONS BELOW THE POVERTY LEVEL. THERE ARE 551.84 TOTAL SQUARE MILES AND 15.2 PERSON PER SQUARE MILE.
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PART VI, LINE 5 - PROMOTION OF COMMUNITY HEALTH
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THE ORGANIZATION'S BOARD OF DIRECTORS IS COMPRISED OF PERSONS WHO RESIDE IN THE ORGANIZATION'S PRIMARY SERVICE AREA WHO ARE NEITHER EMPLOYEES NOR CONTRACTORS OF THE ORGANIZATION, NOR FAMILY MEMBERS THEREOF. THE ORGANIZATION EXTENDS MEDICAL STAFF PRIVALEDGES TO ALL QUALIFIED PHYSICIANS IN ITS COMMUNITY. IN ADDITION, THE ORGANIZATION CONTINUALLY APPLIES SURPLUS FUNDS TOWARD THE IMPROVEMENT OF PATIENT CARE, SUCH AS NEW FACILITIES AND THE PURCHASE OF NEW/UPDATED MEDICAL EQUIPMENT.
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