Kevin Campbell, an analyst at Avondale Partners, noted in a research report that 48% of home health providers surveyed indicated that deal volume had improved in the first quarter, the highest percentage to report an improvement since the third quarter of 2011. He added that home health providers also have access to capital to pursue deals.
On an earnings call, Tony Strange, president and CEO of Gentiva, similarly opened his remarks noting that reimbursement pressure is causing smaller providers to “raise the white flag,” providing opportunities for consolidation.
The Atlanta-based company reported a net loss of $207.2 million in the first quarter compared with net income of $4.8 million during the same period last year.
At Almost Family, Louisville, Ky., CEO William Yarmuth pegged sequestration as well as fewer business days (because of a leap year) as two major obstacles during the quarter. Its net income declined 34.7% to $3.2 million on admissions that were flat, or even increased 1% in its visiting nurses segment.
A higher percentage of patients with Medicare Advantage plans also affected results, Yarmuth said during an earnings call, as payments shifted from “episodic” to “per-visit.” The largest impact was in Kentucky, which represents 18% of the company's admissions, where the state has been shifting significant numbers of retirees to Medicare Advantage plans.
Amedisys, Baton Rouge, La., was the first to report results in April when it highlighted a 2% increase in Medicare admissions in its home health segment but a recertification rate that dropped six percentage points to 38%.
The company recorded net income from continuing operations of $3.9 million, a 54.8% decrease over the same period last year.
Chairman and CEO William Borne said on an earnings call that its home health and hospice segments both underperformed expectations, and even with judicious efforts to control costs, the company was not able to overcome decreased volume and the impact of sequestration.
As a result, Borne announced on the call that the company would divest 39 care centers and consolidate 11. He also said the company planned to reduce its “corporate infrastructure.”
Follow Beth Kutscher on Twitter: @MHbkutscher
