1. The loss for October after backing out adjustments from prior periods (+815k for AB97, - 502k for IGT accrual, net +313k) was a 42,000. This is basically break even for the District.
2. The results are somewhat more favorable than the negative 42,000 suggests since it includes 54k to HFS for revenue cycle consulting and 37k to the state for SNF licensing application fees. or a total of 91k. Without these expenses, the District would have shown a slight profit for the month of October (after applying the parcel tax revenues and before applying prior period adjustments).
3. There is a slight offset in the unrecognized liability of the 50,000 fine from the state which I consider material and which I do not believe the District's chances of prevailing on appeal are high enough as to justify not reserving for this expense.
4. The current assets "cushion" is down to 436k. This is important because of the modified terms to the bank of Alameda loan. It may be difficult, but not impossible to maintain the 1.00 Current Ratio once the borrowing for wound care construction kicks in.
5. The District has some opportunities in terms of uncompensated care reimbursement from Alameda County. This was brought forward a few months ago. I will query Ms Stebbins at the next Board meeting as to when we will have a more definitive answer to this including an estimate of its impact.
6. Maybe a typo or maybe the schedule on page 24 will be provided at the actual meeting, but I could not locate the information referenced in the first bullet point of the overview. ("See schedule on Page 24 for
detail of the impact of the adjustments and a roll forward from the October actual to adjusted results.")
In summary, not great, but not terrible especially when you discount the need to finance seismic retrofit or other capital improvements. Alternatively, you might believe the income from the SNF expansion (Water's Edge) will take care of future capital financing needs. Opinions differ.
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