Regarding the article on "Medicare recapture" deals (Sept. 12, p. 80): Having been involved in the Medicare program since its inception and in many healthcare merger and acquisition situations, I can say that, overall, Medicare has recovered far more "depreciation recapture" from gains on sales than it will ever pay out from losses.
In addition, with the buyer's Medicare depreciable base limited to the seller's original base (on sales since July 19, 1994), and with the blending of capital costs into the DRG system, the Medicare recapture issue eventually will become moot.
With respect to the HCFA staffer's observation on avoiding any Medicare gain or loss through a stock transaction, the tax ramifications of such transactions are of much greater importance than Medicare implications, and deserved mention in the article.
A final note: Sellers shouldn't expect to receive recapture checks from Medicare until well after the hospital sale, often as long as two years later.
CHARLES K. BRADFORD
Midwest director, Cain Brothers & Co., Chicago