Rotech 17, Lincare 0 in Round 1

ORLANDO, Fla. — Rotech Healthcare said this week the
company was offered 17 contracts in the Round 1 rebid of national competitive bidding,
while Susquehanna Financial Group reported that respiratory giant
Lincare, Clearwater, Fla., went 0 for 9.

In a press release, Rotech said it had accepted
contracts in:

• six MSAs for oxygen supplies and equipment;
• six MSAs for enteral nutrients, equipment and supplies;
• three MSAs for CPAP, RADs and related supplies and accessories;
  and
• two MSAs for standard power wheelchairs, scooters and related
  accessories.

The three-year contracts are scheduled to take effect on Jan. 1,
2011.

“We are pleased with our success in the Round 1 rebid of the
national competitive bidding program and we look forward to further
growth and expansion of our existing presence in these initial
cities,” Philip L. Carter, Rotech’s president and CEO, said in the
release. “The new payment rates for our six oxygen contracts
averaged approximately 30 percent off the current applicable
Medicare payment rates.

“Not assuming any market share gains,” Carter continued, “the
application of the new competitive bid rates to our existing
patient base in these nine MSAs reduces our revenue by
approximately $900,000 in the first quarter of 2011. We believe,
however, that our market share gains in the cities where we were
awarded contracts will more than offset the reductions in
reimbursement rates over time.”

Rotech operates in 48 states through approximately 450 locations
primarily in non-urban markets.

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