In brief: AHP catches second break
BRENTWOOD, Tenn. - American HomePatient (AHP) announced last week that it has entered into a second forbearance agreement with NexBank and a majority of secured debt holders for $226.4 million in debt that was due to be repaid Sept. 1. The new due date: Oct. 1. "The parties to the second forbearance have agreed to not exercise, prior to Oct. 1, 2009, any of their rights or remedies for the company's failure to repay the debt in full on the maturity date," according to a release. "The company, the agent and the forbearance holders are currently in discussions to resolve the debt maturity issue. There can be no assurance that these discussions will result in a resolution with favorable terms to the company and its stockholders or at all." The debt was originally due to be repaid Aug. 1.
Loan closet provision delayed
BALTIMORE - CMS has pushed back the effective date for its new consignment closet provisions, from Sept. 8, to March 1, 2010. A memo issued Aug. 7 added a provision to the Medicare Program Integrity manual, seeking to define and prohibit certain loan closet arrangements between HME providers and other practitioners, such as physicians. Under the new guidelines, such arrangements must meet current quality standards. Most do not, it said.
Provider joins lawsuit against big name insurers
PHOENIX - Maldonado Medical, a DME provider, has joined the American Medical Association (AMA) and other physician associations in a nationwide consolidated class action suit against several insurers over the use of a "rigged" database to allegedly underpay them. The insurers are Aetna and Cigna, as well as "co-conspirators" like Wellpoint, Oxford Health, Health Net and the Health Insurance Association of America. The plaintiffs in the lawsuit claim they've been "forced to absorb as much as a 28% reduction." Brandon Maldonado, who owns Maldonado Medical with his brother, Gregory Maldonado, stated in a release: ""We have evidence that multiple health insurance companies have attempted to put us out of business but we have taken a stand, both for the rights of our patients and physicians, as well as our own."