Home health care stocks fall with Senate Finance Committee inquiry

"Shares of four home health care providers tumbled Thursday after the Senate Finance Committee raised questions about how the companies bill Medicare for home health therapy visits, The Associated Press/ABC News reports. The committee sent letters to Amedisys Inc., Almost Family Inc., Gentiva Health Services Inc. and LHC Group Inc. asking for details about policies and guidelines regarding the number of visits provided after "an analysis of Medicare data by The Wall Street Journal that showed that companies appeared to change their business practices to trigger higher reimbursement" (Murphy, 5/13).

Dow Jones Newswires/Wall Street Journal: "The Senate will focus on whether the companies used extra visits, which weren't always medically necessary, to get to 10 visits, a level that would secure an additional $2,200 reimbursement from the government-run health-care program. When the rules were changed in 2008 to eliminate the $2,200 extra bonus in favor of incremental bonuses, a Wall Street Journal analysis found fewer patients were getting 10 visits" (Benoit, 5/13).

Reuters: "'These findings suggest that HHAs [home healthcare agencies] are basing the number of therapy visits they provide on how much Medicare will pay them instead of what is in the best interests of patients,' Senate Finance Committee Chairman Max Baucus and Ranking Republican Member Charles Grassley wrote. ... [The committee] also questioned marketing materials that aim to target seniors 'to take advantage of Medicare payments to improve profits.'" The Senate Committee "asked the companies for a variety of documents that date back as far as 2006, including data on therapy visits, lists of physicians with the highest patient referrals to the agencies, and copies of all marketing materials" (Heavey, 5/13).