PHM feels impact of vent cuts
LAFAYETTE, La. – Cuts to reimbursement for non-invasive ventilators contributed to a drop in revenues for Patient Home Monitoring—a “reset,” for the company, said executives.
Revenues for the second quarter ended March 31, 2016, were nearly 33.8 million CAD, an increase of more than 159% compared to $13 million during the same quarter a year ago. However, that’s down 16% from the first quarter, execs say.
“Last quarter was a reset quarter for us,” Casey Hoyt, CEO, in a transcript posted on Seeking Alpha. “We experienced and adapted to changes in reimbursement in our high margin non-invasive ventilation product line.”
CMS in January reduced the number of codes for vents from five to two and reduced reimbursement by about 33% as part of an overhaul of the product category.
PHM, a Canadian company, rolled up several U.S. HME companies in 2015, including Louisiana-based Sleep Services, Maine-based Black Bear Medical and Kentucky-based Legacy Oxygen.
Going forward, acquisitions remain a key tenet of the company’s growth strategy, says Hoyt.
“The acquisitions we are exploring are generally small asset purchases in our existing geography,” he said. “This year to date, we have closed one acquisition and are in active negotiations with others.”
4Adjusted EBITDA for the company was negative 4.7 million CAD for the quarter, largely as a result of its decision to close LogiMedix, a provider of diabetes testing supplies that it acquired in 2013.
4PHM has a cash balance of nearly 16.2 million CAD, accounts receivable balance of $35.5 million and current liabilities of $35.2 million.