Shares of four home healthcare providers tumbled Thursday after the Senate Finance Committee raised questions about how the companies bill Medicare for home health therapy visits.
The committee sent letters to Amedisys Inc., Almost Family Inc., Gentiva Health Services Inc. and LHC Group Inc. asking for details about visits provided to patients, company guidelines and other information.
The inquiry followed an analysis of Medicare data by The Wall Street Journal that showed that companies appeared to change their business practices to trigger higher reimbursement.
"Companies that work with Medicare should not be allowed to target seniors just because they have Medicare or adjust the way they care for patients simply to increase profits," said Sen. Max Baucus, D.-Mont., in a statement from the committee, which Baucus chairs.
Sen. Chuck Grassley, R-Iowa, said in the same statement that companies need to make sure care is based on patient interests, not profit.
"So far, it appears that either the home healthcare reimbursement policy is flawed, some companies are gaming the system, or both," he said.
The committee also raised questions about an Amedisys fall risk assessment form. The first question on it asks if the respondent is 65 or older.
"As 65 years is the age of eligibility for Medicare, the referral form raises concerns that the program may be taking advantage of Medicare payments in order to improve company profits," the letter to the companies said.
All four providers said they will cooperate with the committee.
Almost Family CEO Wiliam Yarmuth said in a statement that his company's "Senior Advocacy" mission calls for it to offer care based only on patient needs and clinical conditions, "and we are confident that when our data is thoroughly reviewed, it will provide a much clearer picture than was portrayed in The Wall Street Journal article."
LHC said in a statement that all home care services, including therapy, "are dictated by an independent physician order." It also said the Journal assumed a static patient population from 2007, but the company's home health population grew nearly 47 percent in 2008 which dramatically changed the makeup of its top 20 patient diagnoses.
Shares of Almost Family fell $3.22, or 7.6 percent, to close at $39.37. Amedisys fell $4.48, or 8 percent, to $51.73; Gentiva was down $2.20, or 7.4 percent, to finish at $27.55; and LHC shares dropped 83 cents, or 2.3 percent, to $35.28.
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