Note 4 – Accounts Receivable and Income Tax Refunds Receivable

Accounts receivable at December 31, 2021 and 2020 consisted of the following:

 Schedule of Accounts Receivable

The allowances for contractual obligations and doubtful accounts reflected in the table above decreased as a percentage of accounts receivable to 67.4% at December 31, 2021 compared to 86.9% at December 31, 2020.

Estimated implicit price concessions deducted from revenues for the years ended December 31, 2021 and 2020 were $7.7 million and $7.1 million, respectively. The allowance for doubtful accounts deducted from accounts receivable remained relatively constant at $1.5 million at December 31, 2021 compared to $1.5 million at December 31, 2020. The Company’s policy is to write off an accounts receivable balance against the allowance for implicit price concessions once an accounts receivable ages past a specified number of days.

Accounts Receivable Sales Agreements

During the year ended December 31, 2020, the Company entered into six accounts receivable sales agreements under which the Company sold an aggregate of $3.3 million of accounts receivable on a non-recourse basis for an aggregate purchase price paid to the Company of $2.2 million, less $0.1 million of origination fees. Accordingly, the Company recorded a loss on the sales of $1.2 million during the year ended December 31, 2020. As of December 31, 2020, $1.7 million was outstanding and owed to three funding parties under three accounts receivable sales agreements. On September 14, 2021, the Company entered into separate settlement agreements with the three funding parties under which the Company agreed to repay an aggregate of $0.9 million in full settlement of the sales agreements. Per the settlement agreements, the Company is required to make equal monthly payments totaling $52,941 through January 1, 2023. As of December 31, 2021, $0.7 million remains outstanding. As a result of the settlements, the Company recorded a gain from legal settlements of $0.6 million in the year ended December 31, 2021.

Income Tax Refunds Receivable

As of December 31, 2021 and December 31, 2020, the Company had $1.1 million and $1.4 million, respectively, of income tax refunds receivable. During 2020, the U.S. Congress approved the CARES Act, which allowed a five-year carryback privilege for federal net operating tax losses that arose in a tax year beginning in 2018 and through 2020. As a result, during the year ended December 31, 2020, the Company recorded approximately $1.1 million in refunds from the carryback of certain of its federal net operating losses. During the year ended December 31, 2021, the Company received income tax refunds of $0.3 million, which represented refunds associated with the CARES Act. During the year ended December 31, 2020, the Company recorded $0.3 million in refunds related to other net operating loss carryback adjustments and it received income tax refunds of $0.6 million related to the audit of the Company’s 2015 Federal tax return, which is more fully discussed in Note 14. The Company’s income taxes are more fully discussed in Note 13.