Gentiva a Home Healthcare Buy

Highlighted in this blog is Gentiva Health Services, Inc. (GTIV).

In 2008, Medicare spent about $16.5B on home care services out of a total budget of $455B. In a report released Friday March 13, 2009, the U.S. Government Accountability Office (GAO) raised concerns that improper payments from practices indicating fraud and abuse may have contributed to Medicare home health spending and utilization over recent years.

The GAO focused on states with the highest growth in Medicare home health spending or utilization, fraudulent and abusive practices contributing to recent spending and utilization, and administrative issues that make it vulnerable to improper payments.

In comments on a draft of the report, CMS [Centers for Medicare & Medicaid Services] stated it would consider 2 of our 4 recommendations—to amend regulations to expand the types of improper billing practices that are grounds for revocation of billing privileges and to provide physicians who certify or recertify plans of care with a statement of services received by beneficiaries.

While possible headline risk is  a concern, we believe changes to Medicare reimbursement rates in the context of health reform remain the main issue facing the industry at this point.

We recently move to a Buy rating on Gentiva (GTIV) at current levels. is the nation's largest provider of comprehensive home healthcare services, with more than 500 owned and operated direct service delivery units at approximately 400 locations in 36 states.

Read the full analyst report on GTIV