Note 5 – Property and Equipment

Property and equipment, net at December 31, 2021 and 2020 consisted of the following:

 Schedule of Property and Equipment

Property and equipment are depreciated on a straight-line basis over their respective lives. Buildings are depreciated over 39 years, leasehold improvements are depreciated over the life of the lease(s) and the remaining equipment is being depreciated over lives ranging from three to seven years. Depreciation expense on property and equipment was $0.6 million and $0.7 million for the years ended December 31, 2021 and 2020, respectively.

Management periodically reviews the valuation of long-lived assets, including property and equipment, for potential impairment. During 2021, the Company recorded a $2.3 million asset impairment charge for Jamestown Regional Medical Center’s building. In determining the fair value of Jamestown Regional Medical Center’s building, the impairment reflected the changed condition of the building that has not been in use since operations were suspended in June 2019. On March 1, 2021, the Company closed Jellico Community Hospital, after the City of Jellico issued a 30-day termination notice for the lease of the building. As a result of the closing, the Company wrote off $0.3 million of Jellico’s equipment that was no longer of use during 2021.