Leaders behind O2 Science make another play

Friday, March 16, 2012

TEMPE, Ariz. - Arete Sleep Health announced last week that it has been purchased by the previous leadership of O2 Science.

O2 Science was a fast-moving HME roll-up in the early 2000s, before it merged with Pacific Pulmonary Services in 2005.

Leadership has renamed the company STARS Healthcare, with STARS standing for Sleep Testing and Respiratory Services.

"We are laser-focused on industry compliance and quality care," stated Jeff Wurgler, COO at Arete, now STARS Healthcare, in a press release. "Although the previous company and its management do not exist anymore, we have acquired Arete Sleep Health's state-of-the-art equipment, systems and sites. We intend to institute the same strict policies and processes that garnered O2 Science a stellar record with Medicare."

In addition to sleep lab and diagnostic services, STARS Healthcare will also provide respiratory therapy products, such as oxygen concentrators and CPAP devices. It operates six sleep centers in the greater Phoenix area, as well as two centers in Tucson. It has two offices that offer DME, one in Phoenix and the other in Tucson.

O2 Science was formed in 1999. Before merging with Pacific Pulmonary, O2 Science had more than a dozen locations. It had its biggest hiccup in 2003 when its major lender, DVI, filed for Chapter 11 bankruptcy. It regained its footing in 2004 by securing $10.2 million in financing from a private equity firm, Kline Hawkes & Co.



Correct me if I'm wrong, but how can STARS Healthcare use an in-house sleep lab for their own services? Isn't this a confilct of interest as outlined by Medicare policy?