Home Health & Hospice Week

Self-reporting billing problems to the HHS Office of Inspector General might not be as beneficial as the feds would have health care providers believe. Amedisys Inc. in 1999 self-reported irregularities dating back to the previous owner of its Monroe, LA location. Based on two audits by independent parties and "known facts at the time," the regional powerhouse set aside a reserve to cover the expected OIG settlement for the location's detected problems, noted the Baton Rouge, LA-based company's CFO Greg Browne in a March 13 conference call with investors. However, the OIG recently made a settlement offer that slaps Amedisys with extra financial penalties it didn't expect because it was self-reporting, Browne related in the call. Thus, the company must set aside an extra $300,000 to settle the matter. "The self-report process has been an arduous and costly one," Browne said. Amedisys COO Larry Graham revealed in the call that the company has pared its utilization to below 18 visits per patient, per episode. To streamline operations, the company ranked its 65 offices into size categories, then brought each location in line with the utilization for the most efficient agency in its category, Graham explained. Amedisys uses an automated care plan module to increase efficiency and control utilization. Combined with exiting managed care business and reducing staff and overhead costs, the changes have saved the company more than $6 million, Graham celebrated. While visit numbers have gone down, Amedisys' admissions have risen. Admissions grew 11 percent in the quarter ending Dec. 31 and should grow even more in the first quarter of 2003, execs said. Graham attributed the jump in admissions to a reconfigured marketing sales force with increased accountability and incentives for individuals. Despite the favorable operating trends, Amedisys has reported a $6.1 million loss for the quarter on revenues of $31.7 million, compared to a $2.2 million profit on $31.1 million in revenues for the same period of 2001. A $9.7 million charge related to financing from now-bankrupt National Century Financial Enterprises among other things resulted in the loss (see Eli's HCW, Vol. XII, No. 5, p. 35). For the year, Amedisys has reported a $752,000 net income on revenues of $129.4 million, compared to a $5.4 million profit on revenues of $110.2 million for 2001. On the bright side, Amedisys projects continued revenue growth and acquisitions. Increased activity from investors such as Summit Partners and Parthenon Capital might drive up prices for larger acquisitions (see Eli's HCW, Vol. XII, No. 7, p. 51), speculated Amedisys CEO Bill Borne. But valuations for smaller acquisitions that have been the company's bailiwick shouldn't be significantly affected by the increased investor interest, he predicted.