XML 52 R19.htm IDEA: XBRL DOCUMENT
v3.20.1

Lease Accounting | 3 Months Ended
--- | ---
Mar. 31, 2020
Leases [Abstract] |
Lease Accounting | (13) Lease Accounting We adopted Topic 842 effective January 1, 2019. We applied Topic 842 to all leases as of January 1, 2019. We elected the practical expedient package to not reassess at adoption (i) expired or existing contracts for whether they are or contain a lease, (ii) the lease classification of any existing leases or (iii) initial indirect costs for existing leases. We also elected the policy exemption that allows lessees to choose to not separate lease and non-lease components by class of underlying asset and are applying this expedient to all relevant asset classes. We determine if an arrangement is or contains a lease at inception of the contract. Our right-of-use assets represent our right to use the underlying assets for the lease term and our lease liabilities represent our obligation to make lease payments arising from the leases. Right-of-use assets and lease liabilities are recognized at commencement date based on the present value of lease payments over the lease term. We use the implicit rate noted within the contract. If not readily available, we use our estimated incremental borrowing rate, which is derived using a collateralized borrowing rate for the same currency and term as the associated lease. A right-of-use asset and lease liability is not recognized for leases with an initial term of 12 months or less and we recognize lease expense for these leases on a straight-line basis over the lease term within lease and rental expense. Our operating leases are primarily for real estate, including certain acute care facilities, off-campus outpatient facilities, medical office buildings, and corporate and other administrative offices. Our real estate lease agreements typically have initial terms of five to 10 years. These real estate leases may include one or more options to renew, with renewals that can extend the lease term from five to 10 years. The exercise of lease renewal options is at our sole discretion. When determining the lease term, we included options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Three of our hospital facilities are held under operating leases with Universal Health Realty Income Trust with two hospital terms expiring in 2021 and the third expiring in 2026 (see Note 2 for additional disclosure). We are also the lessee of the real property of certain facilities. The components of lease expense for the three month periods ended March 31, 2020 and 2019 are as follows (in thousands):
| Three months ended March 31, |
| 2020 |  |  | 2019 |
Operating lease cost | $ | 18,115 |  |  | $ | 18,079 |
Variable and short term lease cost (a) |  | 10,178 |  |  |  | 8,046 |
Total lease cost | $ | 28,293 |  |  | $ | 26,125 |
Finance lease cost: |  |  |  |  |  |  |
Amortization of right-of-use-assets | $ | 496 |  |  | $ | 481 |
Interest on lease liabilities |  | 456 |  |  |  | 484 |
Total finance lease cost | $ | 952 |  |  | $ | 965 |
| (a) | Includes equipment, month-to-month and leases with a maturity of less than 12 months.
Supplemental cash flow information related to leases for the three month periods ended March 31, 2020 and 2019 are as follows (in thousands):
| Three months ended March 31, |
| 2020 |  |  | 2019 |
Cash paid for amounts included in the measurement of lease liabilities: |  |  |  |  |  |  |
Operating cash flows from operating leases | $ | 28,227 |  |  | $ | 25,884 |
Operating cash flows from finance leases | $ | 489 |  |  | $ | 575 |
Financing cash flows from finance leases | $ | 628 |  |  | $ | 433 |
Right-of-use assets obtained in exchange for lease obligations: |  |  |  |  |  |  |
Operating leases | $ | 29,112 |  |  | $ | 355,981 |
Included in the $356 million of right-of-use assets obtained in exchange for operating lease obligations is $6 million new operating leases entered into during the three month period ended March 31, 2019. Supplemental balance sheet information related to leases as of March 31, 2020 and December 31, 2019 are as follows (in thousands):
| March 31, |  |  | December 31, |
| 2020 |  |  | 2019 |
Operating Leases |  |  |  |  |  |  |
Right of use assets-operating leases | $ | 341,264 |  |  | $ | 326,518 |
Operating lease liabilities | $ | 57,772 |  |  | $ | 56,442 |
Operating lease liabilities noncurrent |  | 284,008 |  |  |  | 270,076 |
Total operating lease liabilities | $ | 341,780 |  |  | $ | 326,518 |
Finance Leases |  |  |  |  |  |  |
Property and equipment | $ | 40,206 |  |  | $ | 38,582 |
Accumulated depreciation |  | (27,107 | ) |  |  | (26,610 | )
Property and equipment, net | $ | 13,099 |  |  | $ | 11,972 |
Current maturities of long-term debt | $ | 2,021 |  |  | $ | 1,650 |
Long-term debt |  | 17,138 |  |  |  | 16,359 |
Total finance lease liabilities | $ | 19,159 |  |  | $ | 18,009 |
Weighted Average remaining lease term, years |  |  |  |  |  |  |
Operating leases |  | 9.6 |  |  |  | 9.7 |
Finance leases |  | 6.5 |  |  |  | 6.9 |
Weighted Average discount rate |  |  |  |  |  |  |
Operating leases |  | 4.6 | % |  |  | 4.7 | %
Finance leases |  | 9.5 | % |  |  | 9.8 | %
Future maturities of lease liabilities as of March 31, 2020 are as follows (in thousands):
| Operating Leases |  |  | Finance Leases |
Year ending December 31, |  |  |  |  |  |  |
2020 (remaining 9 months) | $ | 54,063 |  |  | $ | 2,792 |
2021 |  | 66,353 |  |  |  | 3,604 |
2022 |  | 55,163 |  |  |  | 3,905 |
2023 |  | 50,128 |  |  |  | 4,000 |
2024 |  | 43,412 |  |  |  | 4,099 |
Later years |  | 173,341 |  |  |  | 8,380 |
Total lease payments |  | 442,460 |  |  |  | 26,780 |
less imputed interest |  | (100,680 | ) |  |  | (7,621 | )
Total | $ | 341,780 |  |  | $ | 19,159 |

X
- References No definition available. + Details
Name: | us-gaap_LeasesAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for lessee entity's leasing arrangements including, but not limited to, all of the following: (a.) The basis on which contingent rental payments are determined, (b.) The existence and terms of renewal or purchase options and escalation clauses, (c.) Restrictions imposed by lease agreements, such as those concerning dividends, additional debt, and further leasing. + References Reference 1: http://fasb.org/us-gaap/role/ref/otherTransitionRef -Publisher FASB -Name Accounting Standards Codification -Topic 840 -URI http://asc.fasb.org/topic&trid=2208923 + Details
Name: | us-gaap_LeasesOfLesseeDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration