Apria to Consolidate Billing, Distribution Centers

LAKE FOREST, Calif.–In January, Apria Healthcare Group plans to
close its Sacramento billing office and lay off 75 people. At the
same time, the giant national provider also will open a 100,000-sq.
ft. distribution center in Woodland, Calif., that will employ 75,
according to the Sacramento Business Journal.

Both moves are part of a strategy to consolidate the number of
billing and distribution facilities nationwide and cut costs in the
face of dwindling reimbursements, and neither has anything to do
with the company’s slowed earnings, Lisa Getson, executive vice
president, business development/clinical services, told the
Journal.

This year alone, she said, the company has taken a $20 million
hit in reduced reimbursements for HME, oxygen and inhalation drugs.
Apria’s third-quarter revenues increased just 1 percent over
revenues for the same quarter last year, and the company has
lowered its earnings estimate for 2005 to 2 to 3 percent.

In June, the company announced it was looking for a buyer, but
in late October, said it had decided against a sale and instead
would “focus 100 percent on revenue growth and operating
improvements.”

Last week, the company said it repurchased approximately 7.3
million shares of its outstanding common stock at a price per share
of $23.83, for a total purchase of $175 million, as part of a $250
million share repurchase program.

While the provider plans to keep services like in-home visits,
deliveries and repair as close to patients as possible, Getson
said, back-office operations like billing and warehousing will be
consolidated to improve efficiency and save money. With 38 billing
centers in 2003, the company is looking to shrink that number to
fewer than 20 by the end of 2006.

Apria has more than 11,000 employees and 500 branches serving
all 50 states.