Horizon/CMS Healthcare Corp. is discussing a possible acquisition of Vancouver, Wash.-based Pacific Rehabilitation and Sports Medicine for a price of $6.50 per share, or a total of $53 million, according to Pacific. Pacific said the discussions are continuing and that no definitive agreement has been reached. Pacific provides outpatient physical therapy services at 70 rehabilitation clinics in 10 states. In April, Horizon/CMS, an Albuquerque, N.M.-based long-term-care provider, reportedly called off a planned $62 million deal with Pacific after Pacific's profits fell below expectations. Horizon/CMS provides long-term-care services at 120 owned or leased facilities and 142 managed facilities in 18 states. It also offers rehabilitation and subacute services at more than 200 locations.
Humana will end the use of "gag clauses" in its contracts with physicians. Although Humana, like other HMOs, said the anti-disparagement clauses were "intended to protect the company's health plans from slander," physicians, backed by the American Medical Association, said such language discouraged them from openly communicating with patients. "These clauses were never intended to hinder communications-and to our knowledge did not do so. But if our physician partners believe there is a problem, we intend to fix it," said Gregory H. Wolf, the company's recently appointed president and chief operating officer. Wolf said the move "should provide physicians the flexibility and comfort needed to fully explain treatment options."
Integrated Health Services, a post-acute provider based in Owings Mills, Md., reported a 26% rise in net income. For its third quarter ended Sept. 30, the company saw earnings rise to $16.5 million, or 58 cents per share, compared with $13.1 million, or 52 cents per share, in the year-ago quarter. Revenues rose 20% to $360 million. For the nine months, net income rose 7% to $44 million, or $1.63 per share, from $41 million, or $1.57 per share, in the year-ago period. Revenues rose 19% to $1 billion. The company said earnings were affected by $1.2 million in merger-related costs, $1.9 million in debt payments and a $34.3 million gain from the sale of the company's pharmacy division. IHS offers home care, subacute care, rehabilitation, respiratory therapy, hospice care and diagnostic services at more than 1,000 sites in 47 states.