For-profit Iasis Healthcare, based in Franklin, Tenn., will revise its financial statements for 2014 and the first quarter of fiscal 2015 to fix $47.9 million in accounting errors, according to a recent Securities and Exchange Commission filing.
The restatements are related to revenue overestimates made by a former finance employee of the system's managed-care arm, Health Choice. The employee made errors in recording estimated program settlement amounts for one of Iasis' managed Medicaid plans, according to the SEC filing.
For the fiscal year ended Sept. 30, Iasis' revenue will decrease $30.6 million, or about 1.2 percent of revenue the system previously reported for that fiscal year. For the quarter ended Dec. 31, Iasis' revenue will decrease $17.3 million, or about 2.5 percent of previously reported revenue.
The overestimates coincided with membership growth in the managed Medicaid plan, for which the medical loss ratio is expected to drop 250 basis points for the first half of fiscal 2015. In addition, the medical loss ratio is expected to fall 700 basis points for childless adults newly covered through Medicaid expansion for the first half of fiscal 2015.
More articles on healthcare finance:
Senate approves bipartisan 'doc fix' bill
6 observations on revenue cycle management from BDO Capital
Hallmark Health to pay $1.75M to settle Medicaid billing claims