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Home Health & Hospice Week

Industry Notes:

Gentiva, Amedisys See Strong Medicare Growth

Published on Thu Nov 06, 2003

Gentiva's Medicare revenue increase outstrips other business lines. 

Gentiva Health Services Inc. may not be putting all its eggs in one Medicare basket, but it's a pretty heavy basket nonetheless.

Gentiva's Medicare revenues for the quarter ended Sept. 30 increased 11 percent over revenues for the same period in 2002, while its commercial insurance revenues grew only 7.5 percent during the same period.

The Melville, NY-based home health giant's Medicaid and other government revenues declined, as the company "continued its strategy of tapering or terminating participation in certain low-margin Medicaid and state and county programs," it says.

Gentiva recorded net income for the quarter of $4.5 million on revenues of $199.7 million, compared to a $3.6 million profit on $188.4 million in revenues for the year-ago quarter.

Meanwhile, Amedisys Inc., which serves mainly Medicare patients, saw revenues grow 12 percent from $33.1 million to $37.0 million in the third quarter. Medicare patient admissions grew 10 percent compared to the year-ago quarter, the Baton Rouge, LA-based company says.

The regional chain recorded net income of $2.4 million for the quarter, compared to $1.2 million for the same period in 2002.

  • On the acquisition front, Amedisys is making further inroads in the Texas market with its favored strategy of acquiring hospital-based home health agencies. Amedisys has acquired the home care program of St. Luke's Episcopal Hospital System in Houston for an undisclosed amount.

    The regional chain entered the Texas market by acquiring HHAs in Corpus Christi and Forth Worth in 2002, and opened a location in Dallas recently. "We believe the state represents a tremendous growth opportunity for Amedisys, and our plans call for the continued pursuit of both internal and external growth opportunities," says CEO William Borne.

    The St. Luke's deal should add $3 million in annual revenues to Amedisys' books, it says.

  • The Centers for Medicare & Medicaid Services has reversed the Provider Reimbursement Review Board decision that favored Pioneer Home Health in Bishop, CA.

    Pioneer had won an exception to its cost limits under the interim payment system. The Board decided the HHA qualified for the exception under the "extraordinary circumstances" provision due to the terrain and climate of its mountainous service area (see Eli's HCW, Vol. XII, No. 32, p. 250).

    CMS informed Pioneer of the decision in an Oct. 27 letter, reports consultant Tom Boyd with Rohnert Park, CA-based Boyd & Nicholas, who represented Pioneer in front of the Board.

  • National Home Health Care Corp. is under investigation for the psychiatric nurse practices of its Connecticut subsidiary, the Scarsdale, NY-based company says. The U.S. Attorney's Office in New Haven, CT has subpoenaed related records for an investigation into whether federal laws have been broken, according to NHHC. The probe extends to "certain other competitors in the Connecticut market," the company believes.

  • Reverse mortgages as a way to fund home care are becoming increasingly popular. New York-based mortgage company Vertical Lend is now offering reverse mortgages through its network of 1,800 associates, it says.

    A reverse mortgage "is a loan in which seniors over the age of 62 can capitalize on the equity in their home to receive a lump sum" or other financing arrangement, with which they can pay for home care, home medical equipment or other items and services, Vertical Lend explains. "The older the homeowner, the lower the life expectancy and the larger the amount a lender can advance."

  • Odyssey Healthcare Inc.'s earnings continue to grow by leaps and bounds. The for-profit hospice chain recorded net income of $7.8 million for the quarter ended Sept. 30, up 45 percent from $5.4 million in the same period of 2002. At the same time, revenues grew 40 percent from $50.7 million to $71.0 million, the Dallas-based company says.

    The company made four acquisitions during the quarter and plans to open seven new locations in 2004, it says.

  • Option Care Inc. has officially released the poor earnings it warned investors about last month (see Eli's HCW, Vol. XII, No. 37, p. 295). The Buffalo Grove, IL-based infusion provider recorded a loss of $3.0 million on revenues of $82.4 million for the quarter ended Sept. 30, compared to a $3.9 million profit on $80.9 million in revenues for the same period in 2002.

    The company already has completed restructuring efforts and is starting to see the benefits from them, Option Care execs maintain.

  • Florida is trimming millions of dollars from its community-based care program for the disabled, which will leave thousands of residents with no place to go but institutions, reports The Miami Herald. The estimated $30 to $50 million in cuts, will affect about 10,000 Floridians receiving care, and will keep 12,500 more who are on a waiting list for services there permanently, critics say.

  • Apria Healthcare Group Inc. CEO Larry Higby may be seeing a nice return on his latest investment - in California Gov. Arnold Schwarzenegger (R). Higby is part of a group of millionaire Orange County businessman, called the New Majority, that helped raise almost $2 million for Schwarzenegger's campaign, reports the Orange County Register. The New Majority members expect to have significant input in the administration, they told the paper.

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