Baystate Audit Report and TOC - 2008
Description
C ONSOLIDATED FINANCIAL STATEMENTS Baystate Health, Inc. and Subsidiaries Years Ended September 30, 2008 and 2007 With Report of Independent Auditors Baystate Health, Inc. and Subsidiaries Consolidated Financial Statements Years Ended September 30, 2008 and 2007 Contents Report of Independent Auditors.......................................................................................................1 Consolidated Financial Statements Consolidated Statements of Financial Position................................................................................2 ents of Operations ..........................................................................................3 ents of Changes in Net Assets ........................................................................4 ents of Cash Flows..........................................................................................5 Notes to Consolidated Financial Statements....................................................................................6 Ernst & Young LLP 200 Clarendon Street Boston, Massachusetts 02116-5072 Tel: 617 266 2000 Fax: 617 266 5843 www.ey.com Report of Independent Auditors The Board of Trustees Baystate Health, Inc. We have audited the accompanying consolidated statements of financial position of Baystate Health, Inc. and Subsidiaries (Baystate Health) as ...
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| Publié par | Orde |
| Nombre de lectures | 38 |
| Langue | English |
Extrait
NSOIDOLEDATNI ICNA LAETATS MENT
F S
C Baystate Health, Inc. and Subsidiaries
Years Ended September 30, 2008 and 2007 With Report of Independent Auditors
Baystate Health, Inc. and Subsidiaries
Consolidated Financial Statements
Years Ended September 30, 2008 and 2007
Contents
Report of Independent Auditors.......................................................................................................1 Consolidated Financial Statements Consolidated Statements of Financial Position................................................................................2 Consolidated Statements of Operations ..........................................................................................3 Consolidated Statements of Changes in Net Assets ........................................................................4 Consolidated Statements of Cash Flows..........................................................................................5 Notes to Consolidated Financial Statements....................................................................................6
Ernst & Young LLP 200 Clarendon Street Boston, Massachusetts 02116-5072 Tel: 617 266 2000 Fax: 617 266 5843 www.ey.com
Report of Independent Auditors The Board of Trustees Baystate Health, Inc. We have audited the accompanying consolidated statements of financial position of Baystate Health, Inc. and Subsidiaries (Baystate Health) as of September 30, 2008 and 2007, and the related consolidated statements of operations and changes in net assets, and cash flows for the years then ended. These financial statements are the responsibility of Baystate Healths management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of Baystate Healths internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of Baystate Healths internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Baystate Health, Inc. and Subsidiaries at September 30, 2008 and 2007, and the consolidated results of their operations and changes in net assets and cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States.
December 12, 2008
Assets Current assets: Cash and cash equivalents Investments Accounts receivable, patients, less allowance for uncollectible accounts of $31,886 (2007 $34,215) Accounts receivable, other Estimated final settlements receivable Inventories Prepaid expenses and other current assets Total current assets Long-term investments: Investments Equity investment in unconsolidated affiliates Goodwill Pension asset Deferred expense Land, buildings, and equipment, net Assets whose use is limited: Board-designated funds: Cash and investments Investments of captive insurance company Investments held by trustee under bond indenture agreements Beneficial interest in perpetual trusts Total assets See accompanying notes.
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Baystate Health, Inc. and Subsidiaries Consolidated Statements of Financial Position (In Thousands) September 30 2008 2007 Liabilities and net assets Current liabilities: $ 58,731$ 61,344 payable Accounts 213,653224,695 Medical claims payable Accrued salaries and wages interest on bonds payable Accrued 109,78197,662 Estimated final settlements payable 15,108 advances14,440 Refundable 14,260 obligations12,064 Short-term 15,831 revenue14,546 Deferred 14,60412,519 Current portion of long-term debt 441,968 current liabilities437,270 Total 54,580 debt66,001 Long-term 1,340 liability2,196 Pension 1,7642,045 Insurance liability loss reserves 4,000 liabilities Other 6,238 liabilities3,944 Total 335,582308,659 403,504382,845 Net assets: Unrestricted: 200,170244,802 Operating 77,01971,145 Pension adjustment Total Unrestricted 6,142 restricted6,339 Temporarily 31,64539,149 Permanently restricted 314,976361,435 Total net assets $1,160,448 liabilities and net assets$1,181,550 Total
September 30 2008 2007 $ 76,005$ 69,372 23,95524,393 60,22759,220 1,5751,634 31,26842,243 3,2002,995 9,4459,765 11,8953,504 12,07711,704 229,647224,830 195,897209,004 38,192 79,81373,657 9,2502,687 514,607548,370 611,983622,452 (63,130)(105,559) 548,853516,893 49,95062,083 47,03854,204 645,841633,180 $1,160,448$1,181,550
Baystate Health, Inc. and Subsidiaries Consolidated Statements of Operations (In Thousands) Year Ended September 302008 2007 $1,004,202$ 947,848 272,163255,698 66,00080,202 2,6932,550 1,345,0581,286,298 557,707520,516 458,497438,992 202,446183,888 49,46747,342 21,63125,465 9,85710,992 1,299,6051,227,195 45,45359,103 5,5365,175 38115,715 1,1401,633 8291,180 (3,130)(500) (3,913)(5,030) 84318,173 46,29677,276 2,5503,076 (247)(110) (60,371)12,135 42,42920,571 1,3031,518 $ 31,960$ 114,466
Operating revenues: Net patient service revenue (exclusive of standard charges for charity care of $31,795 in 2008 and $40,328 in 2007) Premiums Other revenue Net assets released from restrictions used for operations Total operating revenues Operating expenses: Salaries and wages Supplies and expense Medical claims and capitation Depreciation and amortization Bad debts Interest expense Total operating expenses Income from operations Non-operating income (expense): Investment income Net realized gain on investments Equity gain in unconsolidated affiliates Net interest savings on swap agreements Change in fair value of swap agreements Income taxes and other Total non-operating income Excess of revenues over expenses Other changes in net assets: Net assets released from restrictions for capital Transfers to restricted net assets Net unrealized (loss) gain on investments Pension adjustment Other Increase in unrestricted net assets See accompanying notes.
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Baystate Health, Inc. and Subsidiaries Consolidated Statements of Changes in Net Assets (In Thousands)
Unrestricted net assets: Excess of revenues over expenses Net assets released from restrictions for capital Transfers to restricted net assets Net unrealized (loss) gain on investments Pension adjustment Other Increase in unrestricted net assets Temporarily restricted net assets: Restricted investment income Net realized and unrealized (loss) gain on investments Contributions Grants Transfers from unrestricted net assets Net assets released from restrictions: For operations For capital Other (Decrease) increase in temporarily restricted net assets Permanently restricted net assets: Contributions Change in value of perpetual trusts (Decrease) increase in permanently restricted net assets Increase in net assets Net assets at beginning of year Net assets at end of year See accompanying notes.
Year Ended September 302008 2007 $ 46,296$ 77,276 2,5503,076 (247)(110) (60,371)12,135 42,42920,571 1,3031,518 31,960114,466 327327 (10,276)8,568 3,8235,760 252270 247110 (2,693)(2,550) (2,550)(3,076) (1,263)(2,547) (12,133)6,862 338365 (7,504)3,341 (7,166)3,706 12,661125,034 633,180508,146 $645,841$633,180
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Baystate Health, Inc. and Subsidiaries Consolidated Statements of Cash Flows (In Thousands) Year Ended September 30 2008 2007 $ 12,661$ 125,034 49,46747,342 (42,429)(20,571) 72,422(53,142) 21,63125,465 7,504(3,341) (4,161)(6,125) (1,140)(1,633) (33,750)(30,206) (13,171)(846) 7,58116,390 237(949) (438)1,637 6,1564,767 11,389(7,420) 93,95996,402 576,173564,911 (587,177)(599,075) (76,209)(55,645) (87,213)(89,809) 4,1616,125 10,15810,000 (320)(3,280) (23,358)(12,157) (9,359)688 (2,613)7,281 61,34454,063 $ 58,731$ 61,344
Operating activities Change in net assets Adjustments to reconcile change in net assets to cash provided by operating activities: Depreciation and amortization Pension adjustment Net realized and unrealized loss (gain) on investments Provision for bad debts Change in beneficial interest of perpetual trusts Restricted contributions Changes in equity investment of affiliate Increase in accounts receivable, patients Net change in estimated final settlements Change in accounts payable and accrued expenses Change in accrued pension liability, net (Decrease) increase in medical claims payable Increase in insurance liability loss reserves Other Net cash provided by operating activities Investing activities Proceeds from sale and maturities of investments Purchase of investments Purchase of land, buildings, and equipment, net Net cash used in investing activities Financing activities Proceeds from restricted contributions Proceeds from bond issuance Net repayments of short-term obligations Repayment of long-term debt Net cash (used in) provided by financing activities Net (decrease) increase in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year See accompanying notes.
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Baystate Health, Inc. and Subsidiaries Notes to Consolidated Financial Statements September 30, 2008 1. Organization Baystate Health, Inc. (Baystate Health or BH) based in Springfield, Massachusetts, is the parent corporation of an integrated health care delivery system with the mission to improve the health of the people in our community every day, with quality and compassion. Baystate Health currently includes the following: • Baystate Medical Center (BMC) located in Springfield, Massachusetts, is the largest of the three hospitals in the Baystate Health system. BMC, the leading health facility in western Massachusetts is the only tertiary care referral medical center and Level I trauma center in the region. It is also home to western New Englands only neonatal and pediatric intensive care units. BMC is a 653-bed, tax exempt, not-for-profit, academic teaching hospital that serves as the western campus of Tufts University School of Medicine. • Baystate Franklin Medical Center (BFMC) located in Greenfield, Massachusetts, is a 90-bed, tax exempt, not-for-profit, acute care community hospital. BFMC serves the northern tier of northwestern Massachusetts and southern Vermont. • Baystate Mary Lane Hospital Corporation (BMLH) located in Ware, Massachusetts, is a 31-bed, tax exempt, not-for-profit, acute care community hospital. BMLH provides services to more than sixteen central Massachusetts communities. • Baystate Medical Education and Research Foundation, Inc. (BMERF) is a multi-specialty academic group practice established as a tax exempt, not-for-profit foundation to support the educational and research programs of Baystate Health, as well as numerous community primary care and outreach services. • Baystate Affiliated Practice Organization, Inc. (BAPO) is a tax-exempt, not-for-profit organization, and consists of community based primary care (internists and pediatricians), medical and surgical specialty practices, obstetrical and gynecological, and hospitalist physicians dedicated to the care and management of patients hospitalized at BH affiliated hospitals. • Baystate Vascular Services, Inc. (BVS) is a tax-exempt, not-for-profit organization that provides preventative, diagnostic and therapeutic health services. BVS enhances the cardiovascular clinical, educational, community, and research activities for Baystate Health and its service area.
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Baystate Health, Inc. and Subsidiaries Notes to Consolidated Financial Statements (continued) 1. Organization (continued) • Baystate Visiting Nurse Association & Hospice (BVNAH) is a tax-exempt, not-for-profit organization that provides comprehensive home health care committed to providing the highest quality care to patients and families, primarily in the home setting. BVNAH meets individual needs by bringing experienced nurses, rehabilitation therapists, social workers, and home care aides to patients homes. • Health New England, Inc. (HNE) is a for-profit, taxable health maintenance organization located in Springfield, Massachusetts, approximately 97% of which is owned by BH and the remaining 3% is owned by BH affiliated physicians. HNEs service area in Massachusetts includes Franklin, Berkshire, Hampden, and Hampshire counties, and part of Worcester county. HNE also serves Hartford, Litchfield, and Tolland counties in Connecticut. • is a for-profit, taxable corporation that currently serves as aIngraham Corporation (IC) holding company for Baystate Health Ambulance, Inc. • Baystate Health Ambulance, Inc. (BHA) is a for-profit, taxable corporation that delivers the latest in mobile critical care providing 24-hour service throughout western New England. • Baystate Administrative Services, Inc. (BAS) is a tax-exempt, not-for-profit corporation that provides management support for the BH subsidiaries, including human resources, marketing, strategic planning, information services, and financial services. • (BHF) is a tax-exempt, charitable organizationBaystate Health Foundation, Inc. established for the purpose of fund-raising for healthcare related activities, in support, and for the benefit, of BH and those subsidiaries of BH that are tax-exempt, not-for-profit corporations, and to hold endowment, charitable donations, and other funds for their benefit. • Baystate Health Insurance Company, Ltd. (BHIC) is a captive insurance company organized and licensed in the Cayman Islands, British West Indies. BHIC provides professional liability and other insurance coverage to the corporate members of BH and their employees. In 2004, BHIC began offering malpractice insurance to members of BHs medical staff who meet criteria for participation.
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Baystate Health, Inc. and Subsidiaries Notes to Consolidated Financial Statements (continued) 2. Significant Accounting Policies Principles of Consolidation The accompanying consolidated financial statements include the accounts of BH and its subsidiaries. All significant intercompany and subsidiary accounts and transactions have been eliminated. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates are made in the areas of the allowance for uncollectible patient accounts receivable, reserve for contractual allowances, investment valuation, accruals for settlements with third-party payors, medical claims payable, accrued insurance liability loss reserves, pension costs, and accrued compensation and benefits. Net Assets Baystate Health and its subsidiaries report net assets and revenues, expenses, gains, and losses based upon the existence or absence of donor-imposed restrictions. In the accompanying consolidated financial statements, net assets that have similar characteristics have been combined into the following categories: Unrestricted Net assets that are not subject to donor-imposed stipulations. Net assets may be designated for specific purposes by action of the Board of Trustees or may otherwise be limited by contractual agreements with outside parties. Temporarily restricted Net assets whose use by Baystate Health and its subsidiaries are subject to donor-imposed stipulations that can be fulfilled by actions of Baystate Health and its subsidiaries or that expire by the passage of time. At September 30, 2008 and 2007, temporarily restricted net assets consist of amounts restricted as to spending for various purposes, such as education, research, clinical, and healthcare programs, as well as cumulative net appreciation of permanent endowment funds.
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Baystate Health, Inc. and Subsidiaries Notes to Consolidated Financial Statements (continued) 2. Significant Accounting Policies (continued) Permanently restricted Net assets subject to donor-imposed stipulations that they be maintained permanently by Baystate Health and its subsidiaries. At September 30, 2008 and 2007, permanently restricted net assets consist of the original cost of permanent endowment gifts and beneficial interests in perpetual trusts. Revenues from sources other than donor-restricted contributions are reported as increases in unrestricted net assets. Expenses are reported as decreases in unrestricted net assets. Gains and losses on investments are reported as increases or decreases in unrestricted net assets unless their use is restricted by explicit donor stipulations or by law. Expirations of temporary restrictions recognized on net assets (i.e., the donor-stipulated purpose has been fulfilled and/or the stipulated time period has elapsed) are reported as reclassifications from temporarily restricted net assets to unrestricted net assets. Temporary restrictions on gifts to acquire long-lived assets are considered met in the period in which the assets are acquired or placed in service. Contributions, including unconditional promises to give and grant awards, are recognized as revenues in the period received. Contributions received with donor-imposed restrictions are reported as permanently or temporarily restricted revenues depending upon the specific restriction. Conditional promises to give are not recognized until the conditions on which they depend are substantially met. Contributions of assets other than cash are recorded at their estimated fair values at the date of the gift. Contributions to be received after one year are discounted at a risk-free rate commensurate with the expected payment term. Amortization of the discount is recorded as contribution revenue in the appropriate net asset category. Allowance is made for uncollectible contributions based upon managements judgment and analysis of the creditworthiness of the donors, past collection experience, and other relevant information. Cash and Cash Equivalents Cash and cash equivalents include all highly liquid investments with a maturity of three months or less when purchased. Investments Investments, including funds held by trustees under bond indenture agreements, are recorded at fair value in the consolidated statements of financial position. The fair value of investments is estimated using quoted market values. Realized gains and losses, interest, and dividends on investments are included in other revenue or non-operating income in the statements of operations unless the income or loss is restricted by donor or law. Unrealized gains and losses on investments are included in the change in unrestricted or temporarily restricted net assets, as applicable. Investments include limited partnership interests in hedge funds and shares of
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