No Admission or Determination of Wrongdoing
CINCINNATI--(BUSINESS WIRE)--Oct. 31, 2017--
Chemed Corporation (Chemed) (NYSE: CHE),the parent company of
VITAS Healthcare Corporation (“VITAS”), announced today that they have
reached final agreement to end the civil litigation and False Claims Act
brought by the U.S. Department of Justice (“DOJ”) in May 2013.
Although VITAS and Chemed dispute the DOJ’s allegations, VITAS elected
to settle to avoid the cost and uncertainty of continued litigation.
This formal Settlement Agreement reflects VITAS’ disagreement with the
DOJ’s claims and includes no admission or determination of any
wrongdoing.
The litigation brought by the DOJ largely focused on professional
disagreement between qualified physicians in determining if a patient
has a terminal prognosis and the appropriate level of care. A patient is
considered terminal if the patient’s life expectancy is estimated to be
six months or less if the patients’ medical condition runs its normal
course.
This litigation involved care provided by VITAS to patients covering
slightly less than 11 years, from July 24, 2002, through May 2, 2013.
During this approximately 11-year period, VITAS provided over 44,000,000
days of hospice care resulting in aggregate hospice billings of over $8
billion.
Under the terms of this civil litigation settlement, and as previously
disclosed, Chemed will pay to the United States and the state of
Illinois a total of $75.5 million plus interest. In addition, the
company has agreed to certain attorney fees and expenses of qui tam
realtors. Total settlement is estimated at $85 million pre-tax ($53
million after-tax) and compares to $90 million pre-tax ($55.5 million
after-tax) of estimated settlement cost recorded in the second quarter
of 2017. The company will fund this settlement with existing cash
balances and its bank credit facility.
In connection with the settlement, VITAS has also agreed to a Corporate
Integrity Agreement with the Office of Inspector General.
Forward-Looking Statements
Certain statements contained in this press release and the accompanying
tables are "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. The words "believe,"
"expect," "hope," "anticipate," "plan" and similar expressions identify
forward-looking statements, which speak only as of the date the
statement was made. Chemed does not undertake and specifically disclaims
any obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events or
otherwise. These statements are based on current expectations and
assumptions and involve various risks and uncertainties, which could
cause Chemed's actual results to differ from those expressed in such
forward-looking statements.
These risks and uncertainties arise from, among other things, possible
changes in regulations governing the hospice care or plumbing and drain
cleaning industries; periodic changes in reimbursement levels and
procedures under Medicare and Medicaid programs; difficulties predicting
patient length of stay and estimating potential Medicare reimbursement
obligations; challenges inherent in Chemed's growth strategy; the
current shortage of qualified nurses, other healthcare professionals and
licensed plumbing and drain cleaning technicians; Chemed’s dependence on
patient referral sources; and other factors detailed under the caption
"Description of Business by Segment" or "Risk Factors" in Chemed’s most
recent report on form 10-Q or 10-K and its other filings with the
Securities and Exchange Commission. You are cautioned not to place undue
reliance on such forward-looking statements and there are no assurances
that the matters contained in such statements will be achieved.
View source version on businesswire.com: http://www.businesswire.com/news/home/20171031006052/en/
Source: Chemed Corporation
Chemed Corporation
David P. Williams, 513-762-6901
