Edgar Filing: AMEDISYS INC

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Form 10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington D.C. 20549

FORM 10-Q

(Mark One)

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2012

¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 0-24260

LOGO

AMEDISYS, INC.

(Exact Name of Registrant as Specified in its Charter)

Delaware

11-3131700

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

5959 S. Sherwood Forest Blvd., Baton Rouge, LA 70816

(Address of principal executive offices, including zip code)

(225) 292-2031 or (800) 467-2662

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

The number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date, is as follows: Common stock, $0.001 par value, 30,127,046 shares outstanding as of May 3, 2012.

TABLE OF CONTENTS


SPECIAL CAUTION CONCERNING FORWARD-LOOKING STATEMENTS		1

PART I. FINANCIAL INFORMATION

ITEM 1.	FINANCIAL STATEMENTS (UNAUDITED):

	CONDENSED CONSOLIDATED BALANCE SHEETS AS OF MARCH 31, 2012 AND DECEMBER 31, 2011	2

	CONDENSED CONSOLIDATED INCOME STATEMENTS FOR THE THREE MONTH PERIODS ENDED MARCH 31, 2012 AND 2011	3

	CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE THREE MONTH PERIODS ENDED MARCH 31, 2012 AND 2011	4

ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	15

ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	23

ITEM 4.	CONTROLS AND PROCEDURES	23

PART II. OTHER INFORMATION

ITEM 1.	LEGAL PROCEEDINGS	24

ITEM 1A.	RISK FACTORS	24

ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	24

ITEM 3.	DEFAULTS UPON SENIOR SECURITIES	24

ITEM 4.	MINE SAFETY DISCLOSURE	24

ITEM 5.	OTHER INFORMATION	24

ITEM 6.	EXHIBITS	25

SIGNATURES		27

INDEX TO EXHIBITS		28

SPECIAL CAUTION CONCERNING FORWARD-LOOKING STATEMENTS

When included in this Quarterly Report on Form 10-Q, or in other documents that we file with the Securities and Exchange Commission (“SEC”) or in statements made by or on behalf of the Company, words like “believes,” “belief,” “expects,” “plans,” “anticipates,” “intends,” “projects,” “estimates,” “may,” “might,” “would,” “should” and similar expressions are intended to identify forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve a variety of risks and uncertainties that could cause actual results to differ materially from those described therein. These risks and uncertainties include, but are not limited to the following: changes in Medicare and other medical payment levels, our ability to open care centers, acquire additional care centers and integrate and operate these care centers effectively, changes in or our failure to comply with existing Federal and state laws or regulations or the inability to comply with new government regulations on a timely basis, competition in the home health industry, changes in the case mix of patients and payment methodologies, changes in estimates and judgments associated with critical accounting policies, our ability to maintain or establish new patient referral sources, our ability to attract and retain qualified personnel, changes in payments and covered services due to the economic downturn and deficit spending by Federal and state governments, future cost containment initiatives undertaken by third-party payors, our access to financing due to the volatility and disruption of the capital and credit markets, our ability to meet debt service requirements and comply with covenants in debt agreements, business disruptions due to natural disasters or acts of terrorism, our ability to integrate and manage our information systems, and changes in or developments with respect to any litigation or investigations relating to the Company, including the SEC investigation and the U.S. Department of Justice Civil Investigative Demands and various other matters, many of which are beyond our control.

Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, you should not rely on any forward-looking statement as a prediction of future events. We expressly disclaim any obligation or undertaking and we do not intend to release publicly any updates or changes in our expectations concerning the forward-looking statements or any changes in events, conditions or circumstances upon which any forward-looking statement may be based, except as required by law. For a discussion of some of the factors discussed above as well as additional factors, see our Annual Report on Form 10-K for the year ended December 31, 2011, filed with the SEC on February 28, 2012, particularly Part I, Item 1A. – “Risk Factors” therein, which are incorporated herein by reference and Part II, Item 1A. – “Risk Factors” of this Quarterly Report on Form 10-Q. Additional risk factors may also be described in reports that we file from time to time with the SEC.

Available Information

Our company website address is www.amedisys.com. We use our website as a channel of distribution for important company information. Important information, including press releases, analyst presentations and financial information regarding our company, is routinely posted on and accessible on the Investor Relations subpage of our website, which is accessible by clicking on the tab labeled “Investors” on our website home page. We also use our website to expedite public access to time-critical information regarding our company in advance of or in lieu of distributing a press release or a filing with the SEC disclosing the same information. Therefore, investors should look to the Investor Relations subpage of our website for important and time-critical information. Visitors to our website can also register to receive automatic e-mail and other notifications alerting them when new information is made available on the Investor Relations subpage of our website. In addition, we make available on the Investor Relations subpage of our website (under the link “SEC filings”) free of charge our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, ownership reports on Forms 3, 4 and 5 and any amendments to those reports as soon as practicable after we electronically file such reports with the SEC. Further, copies of our Certificate of Incorporation and Bylaws, our Code of Ethical Business Conduct, our Corporate Governance Guidelines and the charters for the Audit, Compensation, Quality of Care and Nominating and Corporate Governance Committees of our Board are also available on the Investor Relations subpage of our website (under the link “Corporate Governance”).

Additionally, the public may read and copy any of the materials we file with the SEC at the SEC’s Public Reference Room at 100 F Street, NE, Room 1580, Washington, D.C. 20549. Information on the operation of the Public Reference Room may be obtained by calling the SEC at (800) SEC-0330. Our electronically filed reports can also be obtained on the SEC’s internet site at http://www.sec.gov.

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

AMEDISYS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Amounts in thousands, except share data)

(Unaudited)


	March 31, 2012			December 31, 2011
ASSETS
Current assets:
Cash and cash equivalents	$	41,290		$	48,004
Patient accounts receivable, net of allowance for doubtful accounts of $18,607, and $17,438		161,834			148,061
Prepaid expenses		12,765			11,321
Other current assets		22,072			24,630

Total current assets		237,961			232,016
Property and equipment, net of accumulated depreciation of $101,941 and $94,266		143,965			148,536
Goodwill		334,695			334,695
Intangible assets, net of accumulated amortization of $21,314 and $20,611		49,364			50,067
Deferred tax asset		65,674			68,649
Other assets, net		23,721			24,322

Total assets	$	855,380		$	858,285

LIABILITIES AND EQUITY
Current liabilities:
Accounts payable	$	20,532		$	25,475
Payroll and employee benefits		87,334			82,130
Accrued expenses		65,845			68,493
Current portion of long-term obligations		68,513			33,888
Current portion of deferred income taxes		10,193			11,748

Total current liabilities		252,417			221,734
Long-term obligations, less current portion		68,376			111,551
Other long-term obligations		4,613			4,852

Total liabilities		325,406			338,137

Commitments and Contingencies - Note 5
Equity:
Preferred stock, $0.001 par value, 5,000,000 shares authorized; none issued or outstanding		—			—
Common Stock, $0.001 par value, 60,000,000 shares authorized; 31,443,152, and 31,017,363 shares issued; and 30,730,529 and 30,328,549 shares outstanding		31			30
Additional paid-in capital		437,024			432,390
Treasury Stock at cost 712,623, and 688,814 shares of common stock		(16,044	)		(15,770	)
Accumulated other comprehensive income		15			13
Retained earnings		107,625			102,205

Total Amedisys, Inc. stockholders’ equity		528,651			518,868
Noncontrolling interests		1,323			1,280

Total equity		529,974			520,148

Total liabilities and equity	$	855,380		$	858,285

The accompanying notes are an integral part of these condensed consolidated financial statements.

AMEDISYS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED INCOME STATEMENTS

(Amounts in thousands, except per share data)

(Unaudited)


	For the Three-Month Periods Ended March 31,
	2012			2011
Net service revenue	$	370,833		$	359,314
Cost of service, excluding depreciation and amortization		208,506			187,304
General and administrative expenses:
Salaries and benefits		87,077			83,388
Non-cash compensation		2,482			1,910
Other		44,394			44,296
Provision for doubtful accounts		5,863			3,114
Depreciation and amortization		10,054			9,180

Operating expenses		358,376			329,192

Operating income		12,457			30,122
Other (expense) income:
Interest income		15			118
Interest expense		(2,074	)		(2,252	)
Equity in earnings from equity investments		305			323
Miscellaneous, net		429			(295	)

Total other expense, net		(1,325	)		(2,106	)

Income before income taxes		11,132			28,016
Income tax expense		(4,620	)		(11,058	)

Income from continuing operations		6,512			16,958
Discontinued operations, net of tax		(1,049	)		(1,634	)

Net income		5,463			15,324
Net (income) attributable to noncontrolling interests		(43	)		(36	)

Net income attributable to Amedisys, Inc.	$	5,420		$	15,288

Basic earnings per common share:
Income from continuing operations attributable to Amedisys, Inc. common stockholders	$	0.22		$	0.60
Discontinued operations, net of tax		(0.04	)		(0.06	)

Net income attributable to Amedisys, Inc. common stockholders	$	0.18		$	0.54

Weighted average shares outstanding		29,389			28,366

Diluted earnings per common share:
Income from continuing operations attributable to Amedisys, Inc. common stockholders	$	0.22		$	0.59
Discontinued operations, net of tax		(0.04	)		(0.06	)

Net income attributable to Amedisys, Inc. common stockholders	$	0.18		$	0.53

Weighted average shares outstanding		29,780			28,867

Amounts attributable to Amedisys, Inc. common stockholders:
Income from continuing operations	$	6,469		$	16,922
Discontinued operations, net of tax		(1,049	)		(1,634	)

Net income	$	5,420		$	15,288

The accompanying notes are an integral part of these condensed consolidated financial statements.

AMEDISYS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in thousands)

(Unaudited)


	For the Three-Month Periods Ended March 31,
	2012			2011
Cash Flows from Operating Activities:
Net income	$	5,463		$	15,324
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		10,166			9,355
Provision for doubtful accounts		5,913			3,162
Non-cash compensation		2,482			1,910
401(k) employer match		2,347			1,403
Loss on disposal of property and equipment		505			656
Deferred income taxes		1,421			399
Equity in earnings of equity investments		(305	)		(323	)
Amortization of deferred debt issuance costs		394			394
Return on equity investment		150			240
Changes in operating assets and liabilities, net of impact of acquisitions:
Patient accounts receivable		(19,686	)		(3,536	)
Other current assets		1,335			5,112
Other assets		(39	)		(493	)
Accounts payable		(87	)		2,889
Accrued expenses		2,051			17,605
Other long-term obligations		(239	)		(1,543	)

Net cash provided by operating activities		11,871			52,554

Cash Flows from Investing Activities:
Proceeds from sale of deferred compensation plan assets		230			853
Purchases of deferred compensation plan assets		(47	)		(219	)
Purchases of property and equipment		(10,236	)		(16,580	)

Net cash used in investing activities		(10,053	)		(15,946	)

Cash Flows from Financing Activities:
Proceeds from issuance of stock upon exercise of stock options and warrants		—			96
Proceeds from issuance of stock to employee stock purchase plan		962			1,578
Tax benefit from stock option exercises		(944	)		(82	)
Principal payments of long-term obligations		(8,550	)		(9,627	)

Net cash used in financing activities		(8,532	)		(8,035	)

Net (decrease) increase in cash and cash equivalents		(6,714	)		28,573
Cash and cash equivalents at beginning of period		48,004			120,295

Cash and cash equivalents at end of period	$	41,290		$	148,868

Supplemental Disclosures of Cash Flow Information:
Cash paid for interest	$	3,388		$	3,490

Cash paid for income taxes, net of refunds received	$	1,150		$	2,793

The accompanying notes are an integral part of these condensed consolidated financial statements.

AMEDISYS, INC AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. NATURE OF OPERATIONS, CONSOLIDATION AND PRESENTATION OF FINANCIAL STATEMENTS

Amedisys, Inc., a Delaware corporation, and its consolidated subsidiaries (“Amedisys,” “we,” “us,” or “our”) are a multi-state provider of home health and hospice services with approximately 83% and 85% of our revenue derived from Medicare for the three months ended March 31, 2012 and 2011, respectively. As of March 31, 2012, we had 437 Medicare-certified home health care centers, 88 Medicare-certified hospice care centers and two hospice inpatient units in 38 states within the United States, the District of Columbia and Puerto Rico.

Basis of Presentation

In our opinion, the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting solely of normal recurring adjustments) necessary to present fairly our financial position, our results of operations and our cash flows in accordance with U.S. Generally Accepted Accounting Principles (“U.S. GAAP”). Our results of operations for the interim periods presented are not necessarily indicative of results of our operations for the entire year and have not been audited by our independent auditors.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted from the interim financial information presented. This report should be read in conjunction with our consolidated financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2011 as filed with the Securities and Exchange Commission (“SEC”) on February 28, 2012 (the “Form 10-K”), which includes information and disclosures not included herein.

Use of Estimates

Our accounting and reporting policies conform with U.S. GAAP. In preparing the unaudited condensed consolidated financial statements, we are required to make estimates and assumptions that impact the amounts reported in the condensed consolidated financial statements and accompanying notes. Actual results could materially differ from those estimates.

Reclassifications and Comparability

Certain reclassifications have been made to prior periods’ financial statements in order to conform to the current period’s presentation. During the quarter ended March 31, 2012 and the year ended December 31, 2011, management committed to exit three and 29 care centers, respectively. In accordance with applicable accounting guidance the results of operations for these care centers are presented in discontinued operations in our condensed consolidated financial statements. See Note 3 for additional information regarding our discontinued operations.

Principles of Consolidation

These unaudited condensed consolidated financial statements include the accounts of Amedisys, Inc., and our wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in our accompanying unaudited condensed consolidated financial statements, and business combinations accounted for as purchases have been included in our unaudited condensed consolidated financial statements from their respective dates of acquisition. In addition to our wholly owned subsidiaries, we also have certain equity investments that are accounted for as set forth below.

Equity Investments

We consolidate subsidiaries and/or joint ventures when the entity is a variable interest entity and we are the primary beneficiary or if we have controlling interests in the entity, which is generally ownership in excess of 50%. Third party equity interests in our consolidated joint ventures are reflected as noncontrolling interests in our condensed consolidated financial statements.

For subsidiaries or joint ventures in which we do not have a controlling interest or for which we are not the primary beneficiary, we record such investments under the equity method of accounting.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Revenue Recognition

We earn net service revenue through our home health and hospice care centers by providing a variety of services almost exclusively in the homes of our patients. This net service revenue is earned and billed either on an episode of care basis, on a per visit basis or on a daily basis depending upon the payment terms and conditions established with each payor for services provided. We refer to home health revenue earned and billed on a 60-day episode of care as episodic-based revenue.

AMEDISYS, INC AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

When we record our service revenue, we record it net of estimated revenue adjustments and contractual adjustments to reflect amounts we estimate to be realizable for services provided, as discussed below. We believe, based on information currently available to us and based on our judgment, that changes to one or more factors that impact the accounting estimates (such as our estimates related to revenue adjustments, contractual adjustments and episodes in progress) we make in determining net service revenue, which changes are likely to occur from period to period, will not materially impact our reported consolidated financial condition, results of operations, cash flows or our future financial results.

Home Health Revenue Recognition

Medicare Revenue

Net service revenue is recorded under the Medicare prospective payment system (“PPS”) based on a 60-day episode payment rate that is subject to adjustment based on certain variables including, but not limited to: (a) an outlier payment if our patient’s care was unusually costly (capped at 10% of total reimbursement per provider number); (b) a low utilization payment adjustment (“LUPA”) if the number of visits was fewer than five; (c) a partial payment if our patient transferred to another provider or we received a patient from another provider before completing the episode; (d) a payment adjustment based upon the level of therapy services required (with various incremental adjustments made for additional visits, with larger payment increases associated with the sixth, fourteenth and twentieth visit thresholds); (e) the number of episodes of care provided to a patient, regardless of whether the same home health provider provided care for the entire series of episodes; (f) changes in the base episode payments established by the Medicare Program; (g) adjustments to the base episode payments for case mix and geographic wages; and (h) recoveries of overpayments.

The Centers for Medicare and Medicaid Services (“CMS”) added two new regulations to PPS that became effective April 1, 2011: (1) a face-to-face encounter requirement and (2) changes to the therapy assessment schedule, which require additional patient evaluations and certifications. As a condition for Medicare payment, the first new regulation mandates that prior to certifying a patient’s eligibility for the home health benefit, the certifying physician must document that he or she, or an allowed non-physician practitioner, has had a face-to-face encounter with the patient. The encounter must occur in the timeframe of 90 days prior to the start of care or 30 days after the start of care. Documentation regarding these encounters must be present on certifications. Under the second new regulation, CMS imposed additional therapy assessment requirements. An assessment by a professional qualified therapist must take place at least once every 30 days during a therapy patient’s course of treatment. Additionally, for those qualified patients that require greater than 13 or 19 therapy visits, a qualified therapist must perform the therapy service required, assess the patient, and measure and document potential effectiveness of additional visits. This requirement applies to each therapy discipline caring for the patient, and the assessment must be performed by each discipline close to, but no later than, the 13^th and 19^th visits. Management evaluates the potential for revenue adjustments as a result of these regulations and, when appropriate, provides allowances based upon the best available information.

We make adjustments to Medicare revenue on completed episodes to reflect differences between estimated and actual payment amounts, an inability to obtain appropriate billing documentation or authorizations acceptable to the payor and other reasons unrelated to credit risk. We estimate the impact of such adjustments based on our historical experience, which primarily includes a historical collection rate of over 99% on Medicare claims, and record this estimate during the period in which services are rendered as an estimated revenue adjustment and a corresponding reduction to patient accounts receivable. In addition, management evaluates the potential for revenue adjustments and, when appropriate, provides allowances based upon the best available information. Therefore, we believe that our reported net service revenue and patient accounts receivable will be the net amounts to be realized from Medicare for services rendered.

In addition to revenue recognized on completed episodes, we also recognize a portion of revenue associated with episodes in progress. Episodes in progress are 60-day episodes of care that begin during the reporting period, but were not completed as of the end of the period. We estimate this revenue on a monthly basis based upon historical trends. The primary factors underlying this estimate are the number of episodes in progress at the end of the reporting period, expected Medicare revenue per episode and our estimate of the average percentage complete based on visits performed. As of March 31, 2012 and 2011, the difference between the cash received from Medicare for a request for anticipated payment (“RAP”) on episodes in progress and the associated estimated revenue was immaterial and, therefore, the resulting credits were recorded as a reduction to our outstanding patient accounts receivable in our condensed consolidated balance sheets for such periods.

AMEDISYS, INC AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Non-Medicare Revenue

Episodic-based Revenue. We recognize revenue in a similar manner as we recognize Medicare revenue for episodic-based rates that are paid by other insurance carriers, including Medicare Advantage programs; however, these rates can vary based upon the negotiated terms.

Non-episodic Based Revenue. Gross revenue is recorded on an accrual basis based upon the date of service at amounts equal to our established or estimated per-visit rates, as applicable. Contractual adjustments are recorded for the difference between our standard rates and the contracted rates to be realized from patients, third parties and others for services provided and are deducted from gross revenue to determine net service revenue and are also recorded as a reduction to our outstanding patient accounts receivable. In addition, we receive a minimal amount of our net service revenue from patients who are either self-insured or are obligated for an insurance co-payment.

Hospice Revenue Recognition

Hospice Medicare Revenue

Gross revenue is recorded on an accrual basis based upon the date of service at amounts equal to the estimated payment rates. The estimated payment rates are daily or hourly rates for each of the four levels of care we deliver. The four main levels of care are routine care, general inpatient care, continuous home care and respite care. Routine care accounts for 98% of our total net Medicare hospice service revenue for the three months ended March 31, 2012 and 2011. We make adjustments to Medicare revenue for an inability to obtain appropriate billing documentation or authorizations acceptable to the payor and other reasons unrelated to credit risk. We estimate the impact of these adjustments based on our historical experience, which primarily includes our historical collection rate on Medicare claims, and record it during the period services are rendered as an estimated revenue adjustment and as a reduction to our outstanding patient accounts receivable.

Additionally, as Medicare hospice revenue is subject to an inpatient cap limit and an overall payment cap for each provider number, we monitor these caps and estimate amounts due back to Medicare if a cap has been exceeded. We record these adjustments as a reduction to revenue and an increase in other accrued liabilities. We have settled our Medicare hospice reimbursements for all fiscal years through October 31, 2009. For the Federal cap years ended October 31, 2010 through October 31, 2012, we have $3.8 million recorded for estimated amounts due back to Medicare in other accrued liabilities as of March 31, 2012 and $3.1 million recorded as of December 31, 2011. As a result of our adjustments, we believe our revenue and patients accounts receivable are recorded at amounts that will be ultimately realized.

Effective April 1, 2011, CMS implemented its hospice regulation requiring that a hospice physician or nurse practitioner have a face-to-face encounter with hospice patients during the 30 day period prior to the 180th-day recertification (third benefit period) and each subsequent recertification, to gather clinical findings to determine continued eligibility for hospice care, and that the certifying hospice physician or nurse practitioner attest that such a visit took place. Management evaluates the potential for revenue adjustments due to these regulations and when appropriate provides allowances based upon the best available information.

Hospice Non-Medicare Revenue

We record gross revenue on an accrual basis based upon the date of service at amounts equal to our established rates or estimated per visit rates, as applicable. Contractual adjustments are recorded for the difference between our established rates and the amounts estimated to be realizable from patients, third parties and others for services provided and are deducted from gross revenue to determine our net service revenue and patient accounts receivable.

Patient Accounts Receivable

Our patient accounts receivable are uncollateralized and consist of amounts due from Medicare, Medicaid, other third-party payors and patients. There is no single payor, other than Medicare, that accounts for more than 10% of our total outstanding patient receivables, and thus we believe there are no other significant concentrations of receivables that would subject us to any significant credit risk in the collection of our patient accounts receivable. We fully reserve for accounts which are aged at 365 days or greater. We write off accounts on a monthly basis once we have exhausted our collection efforts and deem an account to be uncollectible.

We believe the credit risk associated with our Medicare accounts, which represent 64% and 73% of our net patient accounts receivable at March 31, 2012 and December 31, 2011, respectively, is limited due to (i) our historical collection rate of over 99% from Medicare and (ii) the fact that Medicare is a U.S. government payor. Accordingly, we do not record an allowance for doubtful accounts for our Medicare patient accounts receivable, which are recorded at their net realizable value after recording estimated revenue adjustments as discussed above. During the three months ended March 31, 2012 and 2011, we recorded $2.7 million and $2.3 million, respectively, in estimated revenue adjustments to Medicare revenue.

AMEDISYS, INC AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

We believe there is a certain level of credit risk associated with non-Medicare payors. To provide for our non-Medicare patient accounts receivable that could become uncollectible in the future, we establish an allowance for doubtful accounts to reduce the carrying amount to its estimated net realizable value.

Medicare Home Health

For our home health patients, our pre-billing process includes verifying that we are eligible for payment from Medicare for the services that we provide to our patients. Our Medicare billing begins with a process to ensure that our billings are accurate through the utilization of an electronic Medicare claim review. We submit a RAP for 60% of our estimated payment for the initial episode at the start of care or 50% of the estimated payment for any subsequent episodes of care contiguous with the first episode for a particular patient. The full amount of the episode is billed after the episode has been completed (“final billed”). The RAP received for that particular episode is then deducted from our final payment. If a final bill is not submitted within the greater of 120 days from the start of the episode, or 60 days from the date the RAP was paid, any RAPs received for that episode will be recouped by Medicare from any other claims in process for that particular provider number. The RAP and final claim must then be re-submitted.

Medicare Hospice

For our hospice patients, our pre-billing process includes verifying that we are eligible for payment from Medicare for the services that we provide to our patients. Once each patient has been confirmed for eligibility, we will bill Medicare on a monthly basis for the services provided to the patient.

Non-Medicare Home Health and Hospice

For our non-Medicare patients, our pre-billing process primarily begins with verifying a patient’s eligibility for services with the applicable payor. Once the patient has been confirmed for eligibility, we will provide services to the patient and bill the applicable payor. Our review and evaluation of non-Medicare accounts receivable includes a detailed review of outstanding balances and special consideration to concentrations of receivables from particular payors or groups of payors with similar characteristics that would subject us to any significant credit risk. We estimate an allowance for doubtful accounts based upon our assessment of historical and expected net collections, business and economic conditions, trends in payment and an evaluation of collectibility based upon the date that the service was provided. Based upon our best judgment, we believe the allowance for doubtful accounts adequately provides for accounts that will not be collected due to credit risk.

Fair Value of Financial Instruments

The following details our financial instruments where the carrying value and the fair value differ (amounts in millions):

Fair Value at Reporting Date Using

Financial Instrument

As of
March 31,
2012

Quoted Prices in
Active Markets for
Identical Items
(Level 1)

Significant Other
Observable Inputs
(Level 2)

Significant
Unobservable Inputs
(Level 3)

Long-term obligations, excluding capital leases

$136.9

$—

$142.0

$—

The estimates of the fair value of our long-term debt are based upon a discounted present value analysis of future cash flows. Due to the existing uncertainty in the capital and credit markets the actual rates that would be obtained to borrow under similar conditions could materially differ from the estimates we have used.

The fair value hierarchy is based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value. The three levels of inputs are as follows:

•

Level 1 — Quoted prices in active markets for identical assets and liabilities.

•

Level 2 — Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

•

Level 3 — Unobservable inputs that are supported by little or no market activity and are significant to the fair value of the assets or liabilities.

AMEDISYS, INC AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

For our other financial instruments, including our cash and cash equivalents, patient accounts receivable, accounts payable and accrued expenses we estimate the carrying amounts’ approximate fair value due to their short term maturity. Our deferred compensation plan assets are recorded at fair value.

Weighted-Average Shares Outstanding

Net income per share attributable to Amedisys, Inc. common stockholders, calculated on the treasury stock method, is based on the weighted average number of shares outstanding during the period. The following table sets forth, for the periods indicated, shares used in our computation of the weighted-average shares outstanding, which are used to calculate our basic and diluted net income attributable to Amedisys, Inc. common stockholders (amounts in thousands):


	For the Three-Month Periods Ended March 31,
	2012		2011
Weighted average number of shares outstanding - basic		29,389		28,366
Effect of dilutive securities:
Stock options		16		91
Non-vested stock and stock units		375		410

Weighted average number of shares outstanding - diluted		29,780		28,867

Anti-dilutive securities		340		—

3. DISCONTINUED OPERATIONS

As part of our ongoing management of our portfolio of care centers, we conducted a review of our operating performance during the first quarter of 2012. Our review considered our current financial performance, market penetration, forecasted market growth and the impact of the proposed 2012 CMS payment revision. As a result of our review, we committed to a plan to exit three home health care centers during the first quarter of 2012.

During 2011, we consolidated 27 home health care centers and five hospice care centers with care centers servicing the same markets, closed 27 home health care centers and two hospice care centers and discontinued the start-up process associated with two prospective unopened home health care centers.

In accordance with applicable accounting guidance, the care centers which were closed in 2012 (three home health care centers) and closed in 2011 (27 home health care centers and two hospice care centers) are presented as discontinued operations in our condensed consolidated financial statements.

Net revenues and operating results for the periods presented for the care centers closed is as follows (dollars in millions):


	For the Three-Month Periods Ended March 31,
	2012			2011
Net revenues	$	0.2		$	5.0
(Loss) before income taxes		(1.8	)		(2.7	)
Income tax benefit		0.8			1.1

Discontinued operations, net of tax	$	(1.0	)	$	(1.6	)

AMEDISYS, INC AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

4. LONG-TERM OBLIGATIONS

Long-term debt consisted of the following for the periods indicated (amounts in millions):


	March 31, 2012			December 31, 2011
Senior Notes:
$35.0 million Series A Notes: semi-annual interest only payments; interest rate at 6.07% per annum; due March 25, 2013	$	35.0		$	35.0
$30.0 million Series B Notes: semi-annual interest only payments; interest rate at 6.28% per annum; due March 25, 2014		30.0			30.0
$35.0 million Series C Notes: semi-annual interest only payments; interest rate at 6.49% per annum; due March 25, 2015		35.0			35.0
$150.0 million Term Loan; $7.5 million principal payments plus accrued interest payable quarterly; interest rate at ABR Rate plus applicable percentage or Eurodollar Rate plus the applicable percentage (1.25% at March 31, 2012); due March 26, 2013		30.0			37.5
Promissory notes		6.9			7.9

		136.9			145.4
Current portion of long-term obligations		(68.5	)		(33.9	)

Total	$	68.4		$	111.5

Our weighted average interest rate for our five year Term Loan was 1.1% and 1.0% for the three months ended March 31, 2012 and 2011, respectively.

As of March 31, 2012, our total leverage ratio (used to compute the margin and commitment fees, described above) was 1.1 and our fixed charge coverage ratio was 1.6.

As of March 31, 2012, our availability under our $250.0 Revolving Credit Facility was $229.5 million as we had $20.5 million outstanding in letters of credit.

5. COMMITMENTS AND CONTINGENCIES

Legal Proceedings

We are involved in the following legal actions:

United States Senate Committee on Finance Inquiry

On May 12, 2010, we received a letter of inquiry from the United States Senate Committee on Finance (the “Committee”) requesting documents and information relating to our policies and practices regarding home therapy visits and therapy utilization trends. A similar letter was sent to the other major publicly traded home health care companies. We cooperated with the Committee with respect to this inquiry.

On October 3, 2011, the Committee publicly issued a report titled “Staff Report on Home Health and the Medicare Therapy Threshold.” The Committee recommended that the CMS “must move toward taking therapy out of the payment model.” We believe that the issuance of the report concludes the Committee’s inquiry, but are not in a position to speculate on the potential for future legislative or oversight action by the Committee.

AMEDISYS, INC AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Securities Class Action Lawsuits

On June 7, 2010, a putative securities class action complaint was filed in the United States District Court for the Middle District of Louisiana against the Company and certain of our current and former senior executives. Additional putative securities class actions were filed in the United States District Court for the Middle District of Louisiana on July 14, July 16, and July 28, 2010.

On October 22, 2010, the Court issued an order consolidating the putative securities class action lawsuits and the Federal Derivative Actions (described immediately below) for pre-trial purposes. In the same order, the Court appointed the Public Employees Retirement System of Mississippi and the Puerto Rico Teachers’ Retirement System as co-lead plaintiffs (together, the “Co-Lead Plaintiffs”) for the putative class. On December 10, 2010, the Court also consolidated the ERISA class action lawsuit (described below) with the putative securities class actions and Federal Derivative Actions for pre-trial purposes.

On January 18, 2011, the Co-Lead Plaintiffs filed an amended, consolidated class action complaint (the “Securities Complaint”) which supersedes the earlier-filed securities class action complaints. The Securities Complaint alleges that the defendants made false and/or misleading statements and failed to disclose material facts about our business, financial condition, operations and prospects, particularly relating to our policies and practices regarding home therapy visits under the Medicare home health prospective payment system and the related alleged impact on our business, financial condition, operations and prospects. The Securities Complaint seeks a determination that the action may be maintained as a class action on behalf of all persons who purchased the Company’s securities between August 2, 2005 and September 28, 2010 and an unspecified amount of damages. All defendants have moved to dismiss the Securities Complaint. That motion is fully briefed and remains pending before the court.

Derivative Actions

On July 2, 2010, an alleged shareholder of the Company filed a derivative lawsuit in the United States District Court for the Middle District of Louisiana, purporting to assert claims on behalf of the Company against certain of our current and former officers and directors. Three similar derivative suits were filed in the United States District Court for the Middle District of Louisiana on July 15, July 21, and August 2, 2010 (together, the “Federal Derivative Actions”). We are named as a nominal defendant in all of those actions. As noted above, on October 22, 2010, the United States District Court for the Middle District of Louisiana issued an order consolidating the Federal Derivative Actions with the putative securities class action lawsuits and for pre-trial purposes.

On January 18, 2011, the plaintiffs in the Federal Derivative Actions filed a consolidated, amended complaint (the “Derivative Complaint”) which supersedes the earlier-filed derivative complaints. The Derivative Complaint alleges that certain of our current and former officers and directors breached their fiduciary duties to the Company by making allegedly false statements, by allegedly failing to establish sufficient internal controls over certain of our home health and Medicare billing practices, by engaging in alleged insider trading, and by committing unspecified acts of waste of corporate assets and unjust enrichment. All defendants in the Federal Derivative Actions, including the Company as a nominal defendant, have moved to dismiss the Derivative Complaint. That motion is fully briefed and remains pending before the court.

On July 23, 2010, a derivative suit was filed in the Nineteenth Judicial District Court, Parish of East Baton Rouge, State of Louisiana. That action also purports to assert claims on behalf of the Company against certain of our current and former officers and directors. On December 8, 2010, the Court entered an order staying the action in deference to the earlier-filed derivative actions pending in federal court.

ERISA Class Action Lawsuit

On September 27, 2010 and October 22, 2010, separate putative class action complaints were filed in the United States District Court for the Middle District of Louisiana against the Company, certain of our current and former senior executives and members of our 401(k) Plan Administrative Committee. The suits allege violations of the Employee Retirement Income Security Act (“ERISA”) since January 1, 2006 and July 1, 2007, respectively. The plaintiffs brought the complaints on behalf of themselves and a class of similarly situated participants in our 401(k) plan. The plaintiffs assert that the defendants breached their fiduciary duties to the 401(k) Plan’s participants by causing the 401(k) plan to offer and hold Amedisys common stock during the respective class periods when it was an allegedly unduly risky and imprudent retirement investment because of our alleged improper business practices. The complaints seek a determination that the actions may be maintained as a class action, an award of unspecified monetary damages and other unspecified relief. As noted above, on December 10, 2010, the Court consolidated the putative ERISA class actions with the putative securities class actions and derivative actions for pre-trial purposes. In addition, on December 10, 2010, the Court appointed interim lead counsel and interim liaison counsel in the ERISA class action.

On March 10, 2011, Wanda Corbin, Pia Galimba and Linda Trammell (the “Co-ERISA Plaintiffs”), filed an amended, consolidated class action complaint (the “ERISA Complaint”), which supersedes the earlier-filed ERISA class action complaints. The ERISA Complaint seeks a determination that the action may be maintained as a class action on behalf of themselves and a class of similarly situated participants in our 401(k) plan from January 1, 2008 through present. All of the defendants have moved to dismiss the ERISA Complaint. That motion is fully briefed and remains pending before the court.

AMEDISYS, INC AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

SEC Investigation

On June 30, 2010, we received notice of a formal investigation from the SEC and received a subpoena for documents relating to the matters under review by the United States Senate Committee on Finance and other matters involving our operations. We are cooperating with the SEC with respect to this investigation.

U.S. Department of Justice Civil Investigative Demand (“CID”)

On September 27, 2010, we received a CID issued by the U.S. Department of Justice pursuant to the federal False Claims Act. The CID requires the delivery of a wide range of documents and information to the United States Attorney’s Office for the Northern District of Alabama, relating to the Company’s clinical and business operations, including reimbursement and billing claims submitted to Medicare for home health services, and related compliance activities. The CID generally covers the period from January 1, 2003. On April 26, 2011, we received a second CID related to the CID issued in September 2010, which generally covers the same time period as the previous CID and requires the production of additional documents. Such CIDs are often associated with previously filed qui tam actions, or lawsuits filed under seal under the False Claims Act (“FCA”), 31 U.S.C. § 3729 et seq. Qui tam actions are brought by private plaintiffs suing on behalf of the federal government for alleged FCA violations. Subsequently, the Company and certain current and former employees have received CIDs for testimony. We are cooperating with the Department of Justice with respect to this investigation and the requests for testimony.

Stark Law

In May 2012, the Company made a disclosure to CMS under the agency’s Stark Law Self-Referral Disclosure Protocol relating to certain services agreements between a subsidiary of the Company and a large physician group. During some period of time since December 2007, the arrangements appear not to have complied in certain respects with an applicable exemption to the Stark Law referral prohibition. The Company intends to cooperate with CMS in its review of this matter

We are unable to assess the probable outcome or reasonably estimate the potential liability, if any, arising from the SEC investigation, the U.S. Department of Justice CIDs, the matter we have disclosed to CMS and the securities, shareholder derivative and ERISA litigation described above given the preliminary stage of these matters. The Company intends to continue to vigorously defend itself in the securities, shareholder derivative and ERISA litigation matters. No assurances can be given as to the timing or outcome of the SEC investigation, the U.S. Department of Justice CIDs, the matter we have disclosed to CMS or the securities, shareholder derivative and ERISA litigation matters described above or the impact of any of the inquiry, investigation or litigation matters on the Company, its consolidated financial condition, results of operations or cash flows, which could be material, individually or in the aggregate.

We recognize that additional putative securities class action complaints and other litigation could be filed, and that other investigations and actions could be commenced, relating to matters involving our home therapy visits and therapy utilization trends or other matters.

In addition to the matters referenced in this note, we are involved in legal actions in the normal course of business, some of which seek monetary damages, including claims for punitive damages. We do not believe that these normal course actions, when finally concluded and determined, will have a material impact on our consolidated financial condition, results of operations or cash flows.

Third Party Audits

From time to time, in the ordinary course of business, we are subject to audits under various governmental programs in which third party firms engaged by CMS conduct extensive review of claims data to identify potential improper payments under the Medicare program.

In January 2010, our subsidiary that provides home health services in Dayton, Ohio received from a Medicare Program Safeguard Contractor (“PSC”) a request for records regarding 137 claims submitted by the subsidiary paid from January 2, 2008 through November 10, 2009 (the “Claim Period”) to determine whether the underlying services met pertinent Medicare payment requirements. Based on the PSC’s findings for 114 of the claims, which were extrapolated to all claims for home health services provided by the Dayton subsidiary paid during the Claim Period, on March 9, 2011, the Medicare Administrative Contractor (“MAC”) for the subsidiary issued a notice of overpayment seeking recovery from our subsidiary of an alleged overpayment of approximately $5.6 million. Our Dayton subsidiary made requests for redetermination to the MAC, which subsequently issued a series of redetermination decisions (“Redetermination Decisions”), 110 of which were unfavorable. Our subsidiary appealed 85 of the unfavorable Redetermination Decisions to MAXIMUS Federal Services, the qualified independent contractor (“QIC”) designated to process appeals from the MAC’s decisions. In November 2011, the QIC affirmed those Redetermination Decisions. We dispute the QIC’s findings and have requested appeal hearings before an administrative law judge (“ALJ”) in which we will seek to have those findings overturned. The ALJ hearings have not been scheduled, and no assurances can be given as to the timing or outcome of the ALJ appeal. As of March 31, 2012, we have recorded no liability with respect to the pending appeals.

AMEDISYS, INC AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

In July 2010, our subsidiary that provides hospice services in Florence, South Carolina received from a Zone Program Integrity Contractor (“ZPIC”) a request for records regarding a sample of 30 beneficiaries who received services from the subsidiary during the period of January 1, 2008 through March 31, 2010 (the “Review Period”) to determine whether the underlying services met pertinent Medicare payment requirements. We acquired the hospice operations subject to this review on August 1, 2009; the Review Period covers time periods both before and after our ownership of these hospice operations. Based on the ZPIC’s findings for 16 beneficiaries, which were extrapolated to all claims for hospice services provided by the Florence subsidiary billed during the Review Period, on June 6, 2011, the MAC for the subsidiary issued a notice of overpayment seeking recovery from our subsidiary of an alleged overpayment of approximately $5.5 million. Our Florence subsidiary made requests for redetermination to the MAC, which subsequently issued a series of redetermination decisions (“Florence Redetermination Decisions”), which were favorable for 4 beneficiaries and unfavorable for 12 beneficiaries. The MAC communicated these decisions to the ZPIC, which re-extrapolated the findings and established a new alleged extrapolated overpayment of $6.3 million. Our subsidiary appealed all of the unfavorable Florence Redetermination Decisions to MAXIMUS Federal Services, the QIC designated to process appeals from the MAC’s decisions. On March 13, 2012, the QIC issued a favorable decision for one beneficiary and unfavorable decisions for 11 beneficiaries. We dispute these findings and intend to vigorously seek to have these findings overturned, but no assurances can be given as to the timing or outcome of any appeal. In the event we pay any amount of this alleged overpayment, we are indemnified by the prior owners of the hospice operations for amounts relating to the period prior to August 1, 2009. As of March 31, 2012, we have recorded no liability for this claim.

In July 2009, Beacon Hospice, Inc., a subsidiary we acquired on June 7, 2011 (“Beacon”), received from Massachusetts Peer Review Organization, Inc. (“MassPro”), an entity contracted with the Massachusetts Office of Medicaid, a request for records regarding 25 beneficiaries in Boston, Framingham and Plymouth, Massachusetts, who received hospice services from Beacon during the period of August 1, 2007 through July 31, 2008 (the “Review Period”) to determine whether the underlying services met pertinent MassHealth Program regulations. Based on Masspro’s findings for 89 of the 112 claims submitted in connection with these beneficiaries, which were extrapolated to all MassHealth claims for hospice services provided by Beacon billed during the Review Period, on February 15, 2012, MassPro issued a notice of overpayment seeking recovery from Beacon of an alleged overpayment of approximately $6.6 million. The Review Period covers a time before our ownership of Beacon, and in the event we pay any amount of this alleged overpayment, we are indemnified by the prior owners of Beacon for such amounts. We dispute these findings and intend to vigorously seek to have these findings overturned, but no assurances can be given as to the timing or outcome of any appeal. As of March 31, 2012, we have recorded no liability for this claim.

Insurance

We are obligated for certain costs associated with our insurance programs, including employee health, workers’ compensation and professional liability. While we maintain various insurance programs to cover these risks, we are self-insured for a substantial portion of our potential claims. We recognize our obligations associated with these costs in the period in which a claim is incurred, including with respect to both reported claims and claims incurred but not reported, up to specified deductible limits. These costs have generally been estimated based on historical data of our claims experience. Such estimates, and the resulting reserves, are reviewed and updated by us on a quarterly basis.

Our health insurance has a retention limit of $0.8 million, our workers’ compensation insurance has a retention limit of $0.4 million and our professional liability insurance has a retention limit of $0.3 million.

6. SEGMENT INFORMATION

Our operations involve servicing patients through our two reportable business segments: home health and hospice. Our home health segment delivers a wide range of services in the homes of individuals who may be recovering from surgery, have a chronic disability or terminal illness or need assistance with the essential activities of daily living. Our hospice segment provides palliative care and comfort to terminally ill patients and their families. The “other” column in the following tables consists of costs relating to corporate support functions that are not directly attributable to a specific segment.

During the three-month period ended March 31, 2012 and during 2011, we closed three and 29 care centers, respectively, which are reflected as discontinued operations in accordance with applicable accounting guidance. See Note 3 for additional information. Prior periods have been reclassified to conform to the current presentation.

Management evaluates performance and allocates resources based on the operating income of the reportable segments, which excludes corporate expenses, but includes revenues and all other costs directly attributable to the specific segment. Segment assets are not reviewed by the company’s chief operating decision maker and therefore are not disclosed below (amounts in millions).

AMEDISYS, INC AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)


	For the Three-Month Periods Ended March 31,2012
	Home Health		Hospice		Other			Total
Net service revenue	$	301.4	$	69.4	$	—		$	370.8
Cost of service, excluding depreciation and amortization		172.0		36.5		—			208.5
General and administrative expenses		70.4		12.7		50.8			133.9
Provision for doubtful accounts		5.1		0.8		—			5.9
Depreciation and amortization		3.2		0.3		6.5			10.0

Operating expenses		250.7		50.3		57.3			358.3

Operating (loss) income	$	50.7	$	19.1	$	(57.3	)	$	12.5


	For the Three-Month Periods Ended March 31,2011
	Home Health		Hospice		Other			Total
Net service revenue	$	320.8	$	38.5	$	—		$	359.3
Cost of service, excluding depreciation and amortization		167.1		20.2		—			187.3
General and administrative expenses		73.5		7.9		48.2			129.6
Provision for doubtful accounts		3.1		—		—			3.1
Depreciation and amortization		3.0		0.1		6.1			9.2

Operating expenses		246.7		28.2		54.3			329.2

Operating (loss) income	$	74.1	$	10.3	$	(54.3	)	$	30.1

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis provides information we believe is relevant to an assessment and understanding of our results of operations and financial condition for the three month period ended March 31, 2012. This discussion should be read in conjunction with the condensed consolidated financial statements and notes thereto included herein, and the consolidated financial statements and notes and the related Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2011 filed with the Securities and Exchange Commission (“SEC”) on February 28, 2012 (the “Form 10-K”), which are incorporated herein by this reference.

Unless otherwise provided, “Amedisys,” “we,” “our,” and the “Company” refer to Amedisys, Inc. and our consolidated subsidiaries.

Overview

We are a leading provider of high-quality, low-cost home health services to the chronic, co-morbid, aging American population with approximately 83% and 85% of our revenue derived from Medicare for the three-month periods ended March 31, 2012 and 2011, respectively. During the three-month period ended March 31, 2012, we had $370.8 million in net service revenue, earnings per diluted share of $0.18 and cash flow from operations of $11.9 million.

Our operations involve servicing patients through our two reportable business segments: home health and hospice. Our home health segment delivers a wide range of services in the homes of individuals who may be recovering from an illness, injury or surgical procedure. Our hospice segment provides care that is designed to provide comfort and support for those who are facing a terminal illness. As of March 31, 2012, we owned and operated 437 Medicare-certified home health care centers, 88 Medicare-certified hospice care centers and two hospice inpatient units in 38 states within the United States, the District of Columbia and Puerto Rico as detailed below:


	Owned and Operated Care Centers
	Home Health			Hospice
At December 31, 2011		439			87
Start-ups		1			1
Closed/Consolidated		(3	)		—

At March 31, 2012		437			88

When we refer to “same store business,” we mean home health and hospice care centers that we have operated for at least the last twelve months; when we refer to “acquisitions,” we mean home health and hospice care centers that we acquired within the last twelve months; and when we refer to “start-ups,” we mean any home health or hospice care center opened by us in the last twelve months. Once a care center has been in operation for a twelve month period, the results for that particular care center are included as part of our same store business from that date forward. When we refer to episodic-based revenue, admissions, recertifications or completed episodes, we mean home health revenue, admissions, recertifications or completed episodes of care for those payors that pay on an episodic-basis, which includes Medicare and other insurance carriers including Medicare Advantage programs.

Recent Developments

Governmental Inquiries and Investigations and Stockholder Litigation

See Note 5 to our condensed consolidated financial statements for a discussion of the recent governmental inquiry, investigations and subsequent stockholder litigation we are involved in. No assurances can be given as to the timing or outcome of these items.

Health Care Reform

In March 2010, President Obama signed into law the Patient Protection and Affordable Care Act (“PPACA”) and the Health Care and Education Reconciliation Act of 2010 (“HCERA”), which amends the PPACA (collectively, the “Health Care Reform Bills”). The Health Care Reform Bills make a number of changes to Medicare payment rates, including the reinstatement of the 3% home health rural add-on, which began on April 1, 2010 (expiring January 1, 2016). The Health Care Reform Bills also include a systematic rebasing of the amount Centers for Medicare and Medicaid Services (“CMS”) reimburses for home health services, to be phased in over four years, beginning in 2014. We anticipate that many of the provisions of the Health Care Reform Bills may be subject to further clarification and modification through the rule-making process. It is uncertain at this time the effect that rebasing will have on our future results of operations or cash flows.

Results of Operations

Consolidated

The following table summarizes our consolidated results of operations (amounts in millions):


	For the Three-Month Periods Ended March 31,
	2012			2011
Net service revenue	$	370.8		$	359.3
Gross margin		162.3			172.0
% of revenue		43.8	%		47.9	%
Other operating expenses		149.8			141.9
% of revenue		40.4	%		39.5	%

Operating income		12.5			30.1

Income tax expense		(4.6	)		(11.1	)
Effective income tax rate		41.5	%		39.5	%

Income from continuing operations		6.5			17.0

Net loss from discontinued operations		(1.0	)		(1.6	)

Net income attributable to Amedisys, Inc.	$	5.4		$	15.3

Our operating income from continuing operations, declined $17.6 million from 2011. Approximately $11 million of the decrease resulted from the 2012 CMS rate cut impacting the home health division. In addition, our home health division experienced declines in episodic volumes and declines in revenue per episode (in excess of the rate cut) which further impacted our performance. We were able to partially mitigate this impact by a $9 million increase in operating income from our hospice division. Our hospice division benefitted from the acquisition of Beacon Hospice, Inc. (“Beacon”) which added approximately $22 million in revenue. Additionally, we had an increase of $3 million in our corporate support functions primarily related to additional salary costs, depreciation and amortization, legal fees and growth in our corporate services related to our Beacon acquisition.

Discontinued operations include the three and 29 care centers we closed during the three-month period ended March 31, 2012 and during 2011, respectively. Their results are detailed below (dollars in millions):


	For the Three-Month Periods Ended March 31,
	2012			2011
Net revenues	$	0.2		$	5.0
(Loss) before income taxes		(1.8	)		(2.7	)
Income tax benefit		0.8			1.1

Discontinued operations, net of tax	$	(1.0	)	$	(1.6	)

Home Health Division

The following table summarizes our home health segment results from continuing operations:


	For the Three-Month Periods Ended March 31,
	2012									2011
	Same Store			Start-ups/ Acquisitions			Total			Same Store		Other (1)			Total
*Financial Information (in millions):*
Episodic-based revenue	$	275.9		$	1.5		$	277.4		$	295.7	$	7.0		$	302.7
Non-episodic revenue		23.8			0.2			24.0			18.0		0.1			18.1

Net service revenue		299.7			1.7			301.4			313.7		7.1			320.8
Episodic-based revenue growth (2)		(7	%)					(8	%)

Cost of service		170.9			1.1			172.0			163.0		4.1			167.1

Gross margin		128.8			0.6			129.4			150.7		3.0			153.7
Other operating expenses		77.8			0.9			78.7			74.9		4.7			79.6

Operating income	$	51.0		$	(0.3	)	$	50.7		$	75.8	$	(1.7	)	$	74.1

*Key Statistical Data:*
Admissions:
Episodic-based		59,458			416			59,874			59,796		1,611			61,407
Non-episodic		14,368			103			14,471			10,405		141			10,546

Total admissions		73,826			519			74,345			70,201		1,752			71,953

Episodic-based admission growth (2)		(1	%)					(2	%)

Recertifications:
Episodic-based		40,648			151			40,799			42,535		726			43,261
Non-episodic		4,707			19			4,726			4,204		37			4,241

Total recertifications		45,355			170			45,525			46,739		763			47,502

Episodic-based recertification growth (2)		(4	%)					(6	%)

Completed Episodes:
Episodic-based		94,297			426			94,723			95,768		2,248			98,016

Visits:
Episodic-based		1,870,919			9,233			1,880,152			1,865,242		43,553			1,908,795
Non-episodic		248,046			1,673			249,719			195,981		1,827			197,808

Total visits		2,118,965			10,906			2,129,871			2,061,223		45,380			2,106,603

Cost per Visit	$	80.65		$	101.94		$	80.76		$	79.05	$	91.25		$	79.31

Average episodic-based revenue per completed episode (3)	$	2,853		$	3,061		$	2,854		$	3,025	$	3,178		$	3,028

Episodic-based visits per completed episode (4)		18.7			17.9			18.7			18.5		19.4			18.5

(1)	Care centers for the prior period which are not considered same store care centers (i.e., care centers consolidated in prior period or unopened startups).

(2)	Episodic-based revenue, admissions or recertifications growth is the percent increase in our episodic-based revenue, admissions or recertifications for the period as a percent of the episodic-based revenue, admissions or recertifications of the prior period.

(3)	Average episodic-based revenue per completed episode is the average episodic-based revenue earned for each episodic-based completed episode of care.

(4)	Episodic-based visits per completed episode are the home health episodic-based visits on completed episodes divided by the home health episodic-based episodes completed during the period.

Net Service Revenue

Our home health revenue is driven by the volume of admissions and recertifications and the revenue per episode on episodes completed and in progress. During the three month period ended March 31, 2012, we experienced declines in all of these revenue metrics which contributed to a $19 million decline in our home health net service revenue. Approximately $14 million of the decline in revenue is due to the 2012 CMS rate cut and the impact of the CMS face-to-face requirements and therapy assessment regulations.

We experienced a decline in episodic-based admissions and recertifications, which accounted for approximately $11 million of the decline in total episodic-based revenue. We believe our admission volumes have been negatively impacted by the CMS face-to-face requirements which were effective April 1, 2011. While our episodic recertifications as a percentage of completed episodes decreased approximately 1%, we experienced a 4% decline in same store episodic-based recertifications. The primary reason for the decrease is the overall decline in our patient census driven by the decline in admission volumes during 2011.

Our revenue per episode decline of 6% has resulted in approximately a $14 million decrease in revenue with approximately $11 million as a result of the CMS rate cut for 2012 with the remainder due to a reduction in therapy utilization and the impact of the new CMS therapy assessment regulations effective April 1, 2011. We experienced continued improvement in our management of this regulation in this quarter.

On a sequential basis, we experienced approximately a 5% increase in episodic-based admissions and a 30% increase in non-episodic admissions. Our average episodic-based revenue per completed episode decreased 4% from the fourth quarter of 2011.

Our private non-episodic revenue increased by $6 million. The increase is due to the addition of two significant managed care contracts during the first quarter of 2012. We anticipate these volumes to remain significantly higher than the 2011 comparables for the remainder of 2012. We are continuing to pursue managed care contracts which could have an additional positive impact to our private volumes.

Cost of Service, excluding Depreciation and Amortization

The increase in cost of service of $5 million is due to the increase in visit volume and an increase in our cost per visit. We performed approximately 23,000 more visits in 2012, which accounted for $2 million of the increase. The remainder is due to the increase in cost per visit. Annual wage increases will be effective April 1, 2012, which will impact this metric for the remainder of 2012.

Hospice Division

The following table summarizes our hospice segment results from continuing operations:


	For the Three-Month Periods Ended March 31,
	2012								2011
	Same Store			Start-ups/ Acquisitions		Total			Same Store		Other (1)			Total
*Financial Information (in millions):*
Medicare revenue	$	41.9		$	23.4	$	65.3		$	35.7	$	0.4		$	36.1
Non-Medicare revenue		2.8			1.3		4.1			2.3		0.1			2.4

Net service revenue		44.7			24.7		69.4			38.0		0.5			38.5
Medicare revenue growth (2)		17	%				81	%

Cost of service		23.0			13.5		36.5			19.6		0.6			20.2

Gross margin		21.7			11.2		32.9			18.4		(0.1	)		18.3
Other operating expenses		8.7			5.1		13.8			7.2		0.8			8.0

Operating income	$	13.0		$	6.1	$	19.1		$	11.2	$	(0.9	)	$	10.3


*Key Statistical Data:*

Hospice admits		3,298			1,604		4,902			3,110		53			3,163
Hospice days		327,885			144,364		472,249			278,022		3,273			281,295
Average daily census		3,603			1,587		5,190			3,089		36			3,125
Revenue per day	$	136.31		$	171.51	$	147.07		$	136.83	$	139.93		$	136.87
Cost of service per day	$	69.97		$	93.33	$	77.10		$	70.73	$	170.42		$	71.89
Average length of stay		91			92		91			88		56			88

(1)	Care centers for the prior period which are not considered same store care centers (i.e. care centers consolidated in prior period or unopened startups).

(2)	Medicare revenue growth is the percent increase in our Medicare revenue for the period as a percent of the Medicare revenue of the prior period.

Net Service Revenue

Our hospice revenue increased $31 million with $7 million from our same store care centers, $1 million from our start-up care centers and $24 million from our acquisitions, offset by a $1 million decrease from care centers we consolidated in 2011.

Hospice revenue is primarily impacted by average daily census, levels of care and payment rates. The increase in same store revenue is due to a 17% increase in same store average daily census over 2011. Our 2012 revenue includes an increase related to an annual hospice rate increase effective October 1, 2011, which was approximately 2.5%. Additionally, our 2012 hospice revenue is net of a $0.7 million hospice cap adjustment, which is up $0.3 million from 2011. We have seen strong growth in our hospice operations over the past two years, and we expect this growth rate to moderate as the care centers mature.

Cost of Service, excluding Depreciation and Amortization

Our hospice cost of service increased $16 million due to our acquisition of Beacon and the 17% increase in our same store average daily census. Our same store cost of service increased 17% which is comparable to the increase in our same store average daily census. Our hospice clinicians are generally paid on a salaried basis, and our care centers are staffed based on the average census of the care center.

Other Operating Expenses

Our other operating expenses increased $2 million on a same store basis. The increase in total other operating expenses is due to our acquisition of Beacon.

Liquidity and Capital Resources

Cash Flows

The following table summarizes our cash flows for the periods indicated (amounts in millions):


	For the Three-Month Periods Ended March 31,
	2012			2011
Cash provided by operating activities	$	11.9		$	52.5
Cash used in investing activities		(10.1	)		(15.9	)
Cash used in financing activities		(8.5	)		(8.0	)

Net (decrease) increase in cash and cash equivalents		(6.7	)		28.6
Cash and cash equivalents at beginning of period		48.0			120.3

Cash and cash equivalents at end of period	$	41.3		$	148.9

Cash provided by operating activities decreased $40.6 million during 2012 compared to 2011 primarily due to the reduction in reimbursement as a result in the CMS rate cut and a decline in operating performance as well as a 3.1 day increase in our days revenue outstanding. The increase in days revenue outstanding is primarily due billing delays associated with our non-Medicare episodic payors resulting from new billing requirements effective January 2012.

Cash used in investing activities decreased $5.8 million during 2012 compared to 2011 due to our decrease in capital expenditures of $6.3 million.

Cash used in financing activities was relatively flat during 2012 compared to 2011. We decreased our outstanding long-term obligations net of borrowings by $8.5 million from December 31, 2011.

Liquidity

Typically, our principal source of liquidity is the collection of our patient accounts receivable, primarily through the Medicare program; however, from time to time, we can and do obtain additional sources of liquidity through sales of our equity or by incurrence of additional indebtedness. As of March 31, 2012, we had $41.3 million in cash and cash equivalents and $229.5 million in availability under our $250.0 million Revolving Credit Facility.

During 2012, we spent $10.2 million in routine capital expenditures, which primarily included equipment and computer software and hardware. Based on our operating forecasts and our debt service requirements, we believe we will have sufficient liquidity to fund our operations, capital requirements and debt service requirements over the next twelve months and into the foreseeable future.

Outstanding Patient Accounts Receivable

Our patient accounts receivable, net increased $13.8 million from December 31, 2011 to March 31, 2012. Our cash collection as a percentage of revenue was 99.9% for the three-month period ended March 31, 2012 and 102.9% for the three-month period ended December 31, 2011. Our days revenue outstanding, net has increased by 3.1 days since December 31, 2011 primarily due to billing delays associated with our non-Medicare episodic payors resulting from new billing requirements effective January 2012. These billing delays have been resolved and we expect to see an increase in cash collections during the second quarter of 2012.

Our patient accounts receivable includes unbilled receivables, which are aged based upon our initial service date. At March 31, 2012, the unbilled patient accounts receivable, as a percentage of gross patient accounts receivable, was 25.2%, or $47.1 million, compared to 28.3%, or $48.8 million, at December 31, 2011. We monitor unbilled receivables on a care center by care center basis to ensure that all efforts are made to bill claims within timely filing deadlines. The timely filing deadline for Medicare is one year from the date the episode was completed and varies by state for Medicaid-reimbursable services and among insurance companies.

Our provision for estimated revenue adjustments (which is deducted from our service revenue to determine net service revenue) and provision for doubtful accounts were as follows for the periods indicated (in millions). We fully reserve for both our Medicare and other patient accounts receivable that are aged over 365 days.


	For the Three-Month Periods Ended March 31,
	2012			2011
Provision for estimated revenue adjustments (1)	$	2.8		$	2.4
Provision for doubtful accounts (1)		5.9			3.2

Total	$	8.7		$	5.6

As a percent of revenue		2.4	%		1.5	%

(1)	Includes $0.1 million from discontinued operations for the three months ended March 31, 2012 and 2011, respectively.

The following schedules detail our patient accounts receivable, net of estimated revenue adjustments, by payor class, aged based upon initial date of service (amounts in millions, except days revenue outstanding, net):


	0-90		91-180		181-365		Over 365		Total
At March 31, 2012:
Medicare patient accounts receivable, net (1)	$	86.4	$	14.8	$	3.0	$	—	$	104.2


Other patient accounts receivable:
Medicaid		12.1		3.2		1.6		0.2		17.1
Private		36.3		15.3		4.5		3.0		59.1

Total	$	48.4	$	18.5	$	6.1	$	3.2	$	76.2

Allowance for doubtful accounts (2)										(18.6	)

Non-Medicare patient accounts receivable, net									$	57.6


Total patient accounts receivable, net									$	161.8

Days revenue outstanding, net (3)										38.4


	0-90		91-180		181-365		Over 365		Total
At December 31, 2011:
Medicare patient accounts receivable, net (1)	$	87.8	$	18.1	$	2.3	$	—	$	108.2


Other patient accounts receivable:
Medicaid		12.3		2.9		1.2		0.3		16.7
Private		27.0		6.9		4.9		1.8		40.6

Total	$	39.3	$	9.8	$	6.1	$	2.1	$	57.3

Allowance for doubtful accounts (2)										(17.4	)

Non-Medicare patient accounts receivable, net									$	39.9


Total patient accounts receivable, net									$	148.1

Days revenue outstanding, net (3)										35.3

(1)

The following table summarizes the activity and ending balances in our estimated revenue adjustments (amounts in millions), which is recorded to reduce our Medicare outstanding patient accounts receivable to their estimated net realizable value, as we do not estimate an allowance for doubtful accounts for our Medicare claims.


	For the Three-Month Period Ended March 31, 2012			For the Three-Month Period Ended December 31, 2011
Balance at beginning of period	$	6.8		$	6.8

Provision for estimated revenue adjustments (a)		2.8			4.0

Write offs		(3.0	)		(4.0	)


Balance at end of period	$	6.6		$	6.8

(a)	Includes $0.1 million and less than $0.1 million from discontinued operations for the three month periods ended March 31, 2012 and December 31, 2011, respectively.

Our estimated revenue adjustments were 6.0% and 5.9% of our outstanding Medicare patient accounts receivable at March 31, 2012 and December 31, 2011, respectively.

(2)	The following table summarizes the activity and ending balances in our allowance for doubtful accounts (amounts in millions), which is recorded to reduce only our Medicaid and private payer outstanding patient accounts receivable to their estimated net realizable value.


	For the Three-Month Period Ended March 31, 2012			For the Three-Month Period Ended December 31, 2011
Balance at beginning of period	$	17.4		$	18.1
Provision for doubtful accounts (a)		5.9			3.8
Write offs		(4.7	)		(4.5	)

Balance at end of period	$	18.6		$	17.4

(a)	Includes $0.1 million and less than $0.1 million from discontinued operations for the three month periods ended March 31, 2012 and December 31, 2011 respectively.

Our allowance for doubtful accounts was 24.4% and 30.5% of our outstanding Medicaid and Private patient accounts receivable at March 31, 2012 and December 31, 2011, respectively.

(3)

Our calculation of days revenue outstanding, net is derived by dividing our ending net patient accounts receivable (i.e., net of estimated revenue adjustments and allowance for doubtful accounts ) at March 31, 2012 and December 31, 2011 by our average daily net patient revenue for the three-month periods ended March 31, 2012 and December 31, 2011, respectively.

Indebtedness

Our weighted-average interest rate for our five year Term Loan for the quarters ended March 31, 2012 and 2011 was 1.1% and 1.0%, respectively.

As of March 31, 2012, our total leverage ratio (used to compute the margin and commitment fees, described in more detail in Note 7 of the financial statements included in our Form 10-K) was 1.1, our fixed charge coverage ratio was 1.6, and we were in compliance with the covenants associated with our long-term obligations.

As of March 31, 2012, our availability under our $250.0 million Revolving Credit Facility was $229.5 million as we had $20.5 million outstanding in letters of credit.

See Note 7 of the financial statements included in our Form 10-K for additional details on our outstanding long-term obligations.

Inflation

We do not believe inflation has significantly impacted our results of operations.

Critical Accounting Policies

See Part II, Item 7 — Critical Accounting Policies and our consolidated financial statements and related notes in Part IV, Item 15 of our 2011 Annual Report on Form 10-K, for accounting policies and related estimates we believe are the most critical to understanding our condensed consolidated financial statements, financial condition and results of operations and which require complex management judgment and assumptions, or involve uncertainties. These critical accounting policies include revenue recognition; patient accounts receivable; insurance; goodwill and intangible assets; and income taxes. There have not been any changes to our significant accounting policies or their application since we filed our 2011 Annual Report on Form 10-K.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to market risk from fluctuations in interest rates. Our Revolving Credit Facility and Term Loan carry a floating interest rate which is tied to the Eurodollar rate (i.e. LIBOR) and the Prime Rate and therefore, our condensed consolidated statements of operations and our condensed consolidated statements of cash flows will be exposed to changes in interest rates. As of March 31, 2012, the total amount of outstanding debt subject to interest rate fluctuations was $30.0 million. A 1.0% interest rate change would cause interest expense to change by approximately $0.3 million annually.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We have established disclosure controls and procedures which are designed to provide reasonable assurance of achieving their objectives and to ensure that information required to be disclosed in our reports filed under the Exchange Act is recorded, processed, summarized, disclosed and reported within the time periods specified in the SEC’s rules and forms. This information is also accumulated and communicated to our management and Board of Directors to allow timely decisions regarding required disclosure.

In connection with the preparation of this Quarterly Report on Form 10-Q, as of March 31, 2012, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of our disclosure controls and procedures, as such term is defined under Rules 13a-15(e) and 15d-15(e) promulgated under the Exchange Act.

Based on this evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective at a reasonable assurance level as of March 31, 2012, the end of the period covered by this Quarterly Report.

Changes in Internal Controls

There have been no changes in our internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f)) that have occurred during the quarter ended March 31, 2012, that have materially impacted, or are reasonably likely to materially impact, our internal control over financial reporting.

Inherent Limitations on Effectiveness of Controls

Our management, including our principal executive officer and principal financial officer, does not expect that our disclosure controls or our internal controls over financial reporting will prevent or detect all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. The design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Further, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Projections of any evaluation of controls’ effectiveness to future periods are subject to risks. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies and procedures. Our disclosure controls and procedures are designed to provide reasonable assurance of achieving their objectives and, based on an evaluation of our controls and procedures, our principal executive officer and our principal financial officer concluded our disclosure controls and procedures were effective at a reasonable assurance level as of March 31, 2012, the end of the period covered by this Quarterly Report.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

See Note 5 to the condensed consolidated financial statements for information concerning our legal proceedings.

ITEM 1A. RISK FACTORS

In addition to the other information set forth in this Quarterly Report on Form 10-Q, you should carefully consider the risk factors include in Part I, “Item 1A. — “Risk Factors”“ of our Annual Report on Form 10-K. These risk factors could materially impact our business, financial condition and/or operating results. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely impact our business, financial condition and/or operating results.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The following table provides the information with respect to purchases made by us of shares of our common stock during each of the months during the three-month period ended March 31, 2012:


Period	(a) Total Number of Share (or Units) Purchased			(b) Average Price Paid per Share (or Unit)		(c) Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs		(d) Maximum Number (or Approximate Dollar Value) of Shares (or Units) That May Yet Be Purchased Under the Plans or Programs
January 1, 2012 to January 31, 2012		16,536		$	11.02		—	$	—
February 1, 2012 to February 29, 2012		7,070		$	12.63		—		—
March 1, 2012 to March 31, 2012		203		$	12.66		—		—

		23,809	(1)	$	11.51		—		—

(1)	Includes shares of common stock surrendered to us by certain employees to satisfy tax withholding obligations in connection with the vesting of non-vested stock previously awarded to such employees under our 2008 Omnibus Incentive Compensation Plan.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

None.

ITEM 6.

EXHIBITS

The exhibits marked with the cross symbol (†) are filed and the exhibits marked with a double cross (††) are furnished with this Form 10-Q. Any exhibits marked with the asterisk symbol (*) are management contracts or compensatory plans or arrangements filed pursuant to Item 601(b)(10)(iii) of Regulation S-K.


Exhibit Number	Document Description	Report or Registration Statement	SEC File or Registration Number	Exhibit or Other Reference

3.1	Composite of Certificate of Incorporation of the Company inclusive of all amendments through June 14, 2007	The Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2007	0-24260	3.1

3.2	Composite of By-Laws of the Company inclusive of all amendments through October 22, 2009	The Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2009	0-24260	3.2

4.1	Common Stock Specimen	The Company’s Registration Statement on Form S-3 filed August 20, 2007	333-145582	4.8

4.2	Note Purchase Agreement dated March 25, 2008 among Amedisys, Inc., Amedisys Holding, L.L.C. and the Purchasers identified on Schedule A thereto, relating to the issuance and sale of (a) $35,000,000 aggregate principal amount of their 5.07% Series A Senior Notes due March 25, 2013 (b) $30,000,000 aggregate principal amount of their 6.28% Series B Senior Notes due March 25, 2014 and (c) $35,000,000 aggregate principal amount of their 6.49% Series C Senior Notes due March 25, 2015	The Company’s Current Report on Form 8-K filed on April 1, 2008	0-24260	4.1

4.3	Form of Series A Note due March 25, 2013 (attached as Exhibit 1 to the Note Purchase Agreement Incorporated by reference as Exhibit 4.4 hereto)	The Company’s Current Report on Form 8-K filed on April 1, 2008	0-24260	4.2

4.4	Form of Series B Note due March 25, 2014 (attached as Exhibit 2 to the Note Purchase Agreement Incorporated by reference as Exhibit 4.4 hereto)	The Company’s Current Report on Form 8-K filed on April 1, 2008	0-24260	4.3


Exhibit Number	Document Description	Report or Registration Statement	SEC File or Registration Number	Exhibit or Other Reference

4.5	Form of Series C Note due March 25, 2015 (attached as Exhibit 3 to the Note Purchase Agreement Incorporated by reference as Exhibit 4.4 hereto)	The Company’s Current Report on Form 8-K filed on April 1, 2008	0-24260	4.4

†31.1	Certification of William F. Borne, Chief Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

†31.2	Certification of Ronald A. LaBorde, Chief Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

††32.1	Certification of William F. Borne, Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

††32.2	Certification of Ronald A. LaBorde, Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

††101.INS	XBRL Instance

††101.SCH	XBRL Taxonomy Extension Schema Document

††101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document

††101.DEF	XBRL Taxonomy Extension Definition Linkbase

††101.LAB	XBRL Taxonomy Extension Labels Linkbase Document

††101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


AMEDISYS, INC. (Registrant)

By:		/s/ SCOTT G. GINN

		Scott G. Ginn,
		Principal Accounting Officer and Duly Authorized Officer

Date: May 9, 2012

EXHIBIT INDEX

The exhibits marked with the cross symbol (†) are filed and the exhibits marked with a double cross (††) are furnished with this Form 10-K. Any exhibits marked with the asterisk symbol (*) are management contracts or compensatory plans or arrangements filed pursuant to Item 601(b)(10)(iii) of Regulation S-K.


Exhibit Number	Document Description	Report or Registration Statement	SEC File or Registration Number	Exhibit or Other Reference

3.1	Composite of Certificate of Incorporation of the Company inclusive of all amendments through June 14, 2007	The Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2007	0-24260	3.1

3.2	Composite of By-Laws of the Company inclusive of all amendments through October 22, 2009	The Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2009	0-24260	3.2

4.1	Common Stock Specimen	The Company’s Registration Statement on Form S-3 filed August 20, 2007	333-145582	4.8

4.2	Note Purchase Agreement dated March 25, 2008 among Amedisys, Inc., Amedisys Holding, L.L.C. and the Purchasers identified on Schedule A thereto, relating to the issuance and sale of (a) $35,000,000 aggregate principal amount of their 5.07% Series A Senior Notes due March 25, 2013 (b) $30,000,000 aggregate principal amount of their 6.28% Series B Senior Notes due March 25, 2014 and (c) $35,000,000 aggregate principal amount of their 6.49% Series C Senior Notes due March 25, 2015	The Company’s Current Report on Form 8-K filed on April 1, 2008	0-24260	4.1

4.3	Form of Series A Note due March 25, 2013 (attached as Exhibit 1 to the Note Purchase Agreement Incorporated by reference as Exhibit 4.4 hereto)	The Company’s Current Report on Form 8-K filed on April 1, 2008	0-24260	4.2

4.4	Form of Series B Note due March 25, 2014 (attached as Exhibit 2 to the Note Purchase Agreement Incorporated by reference as Exhibit 4.4 hereto)	The Company’s Current Report on Form 8-K filed on April 1, 2008	0-24260	4.3

4.5	Form of Series C Note due March 25, 2015 (attached as Exhibit 3 to the Note Purchase Agreement Incorporated by reference as Exhibit 4.4 hereto)	The Company’s Current Report on Form 8-K filed on April 1, 2008	0-24260	4.4


Exhibit Number	Document Description	Report or Registration Statement	SEC File or Registration Number	Exhibit or Other Reference

†31.1	Certification of William F. Borne, Chief Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

†31.2	Certification of Ronald A. LaBorde, Chief Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

††32.1	Certification of William F. Borne, Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

††32.2	Certification of Ronald A. LaBorde, Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

††101.INS	XBRL Instance

††101.SCH	XBRL Taxonomy Extension Schema Document

††101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document

††101.DEF	XBRL Taxonomy Extension Definition Linkbase

††101.LAB	XBRL Taxonomy Extension Labels Linkbase Document

††101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

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