UPDATE: Amedisys Reports Finalized Settlement with Gov't, Will Fund Settlement with Cash on Hand, Credit Facility

Amedisys, Inc.(Nasdaq: AMED), one of America's leading home health and hospice carecompanies, announced today that the company has finalized its previouslyannounced settlement to bring to an end the civil investigation brought by theU.S. Department of Justice ("DOJ").Amedisys has fully cooperated with the DOJ civil investigation, which involvedMedicare reimbursement for home health services provided by certain Amedisyscare centers from January 1, 2008 through December 31, 2010. The settlementalso resolves a previously disclosed Stark Law issue regarding carecoordination services provided to a physician practice group in exchange forcompensation that was not consistent with fair market value during the periodApril 1, 2008 through April 30, 2012, which the company voluntarilyself-disclosed to the Centers for Medicare and Medicaid Services.As previously announced, although Amedisys disputed the DOJ's allegations ofmisconduct, it decided to settle to avoid the cost and uncertainty inherent inprotracted litigation. The DOJ investigation primarily centered ondeterminations made by Amedisys clinicians and independent physicians thatpatients were homebound and needed skilled nursing or therapy services, andthat the services provided were medically necessary. Each year, Amedisys'dedicated clinicians provide care to more than 360,000 patients, many of whomsuffer from more than one chronic and debilitating disease.Amedisys maintains that it operated according to stringent policies requiringthat home health nursing and therapy services be delivered to qualifyingpatients having a medical need for such care, and only upon the direction oftheir physicians. Amedisys provides extensive training to its cliniciansconcerning these requirements and has made significant investments in itscompliance program, which has been designed to comport with guidelinesestablished by the Office of Inspector General, United States Department ofHealth and Human Services. The final Settlement Agreement reflects Amedisys'disagreement with the DOJ's claims and includes no admission or determinationof wrongdoing."We are pleased to put this matter behind us," stated Ronald A. LaBorde,President and Interim Chief Executive Officer. "We are intensely focused onachieving the best possible outcomes for our patients by providing the carethey need, when they need it, in the comfort of their own homes. We strivediligently to ensure that our operations are fully compliant with Medicareprogram requirements."Under the terms of the civil settlement, and as disclosed previously, Amedisyswill pay a total of $150 million plus interest in two installments. The firstinstallment of $115 million plus interest must be paid by May 2, 2014, and theremaining $35 million plus interest must be paid by October 23, 2014. Thecompany will fund the settlement through cash on hand and draws upon itsexisting credit facility.Amedisys took the charge associated with the settlement in the third quarterof 2013. In addition to the amount to be paid to the United States, thecompany will be responsible for payment of attorneys' fees and expenses ofvarious qui tam relators in the amount of approximately $3.9 million, whichwill be recorded in the first quarter of 2014.