TORONTO, June 6, 2013 /CNW/ - Centric Health Corporation ("Centric Health" or "the Company") (TSX: CHH), today provided an update on the proposed changes announced by the Ontario Ministry of Health and Long-Term Care (MOHLTC) to publicly funded physiotherapy for seniors in Ontario. Within its Physiotherapy segment, Centric Health provides high-quality physiotherapy and related services to seniors in approximately 468 Long-Term Care and Retirement Homes with more than 50,000 residents operating primarily in the province of Ontario through its network of independent consultants.
As disclosed in the Company's first quarter financial results filings and news release, the MOHLTC has announced proposed changes to the funding model for publicly funded physiotherapy to Long-Term Care Homes which have been announced to take effect on August 1, 2013. The announcement included a community delivery model delivered through Community Care Access Centres (CCACs) for seniors in Retirement Homes and a change to the method by which care is delivered through existing OHIP physiotherapy clinics serving seniors, children under the age of 19 and people with disabilities.
Centric Health expects that the decrease in direct public funding for physiotherapy services it provides in Long-Term Care Homes and the elimination of direct funding for physiotherapy services it provides in Retirement Homes could negatively impact revenue for its Physiotherapy segment beginning in the third quarter of 2013, if the announced proposed changes are implemented on August 1, 2013. Approximately 12% of the Company's 2012 consolidated revenues were derived from services that may be impacted by the announced changes. Although the actual amount of any potential impact remains unclear and unknown at this time, Centric Health's strategy is predicated on innovative, relevant and sustainable solutions. The Company is taking steps to mitigate any impact through existing and new revenue streams, including, but not limited to, rehabilitation and other ancillary services on a private pay basis in the community and in existing and new Long-Term Care and Retirement Homes, the continuation of a large percentage of services already provided in Long-Term Care Homes, and its Bundled Services offering. There may also be other opportunities with funding administered through the Local Health Integration Networks (LHINs) and CCACs. The Company may provide a further update on the impact of the proposed changes and the Company's mitigation strategies and pursuit of new opportunities once it is in a position to do so.
"We believe we are well positioned to take advantage of a number of potential opportunities to generate additional revenue that will mitigate the potential impact of the announced funding changes on our business," said David Cutler, President and Chief Executive Officer, Centric Health Corporation. "Moreover, we believe the announced changes could create new opportunities within our already successful Bundled Services offering, which leverages our integrated platform to offer a combination of Physiotherapy, Pharmacy and Home Medical Equipment services to Long-Term Care and Retirement Homes as the industry changes in response to the announced changes."
"Centric Health has extensive experience providing high-quality Bundled Services to seniors in a seamless and integrated manner - a comprehensive care package of healthcare services for seniors - allowing flexibility, one-on-one personalized care in pharmacy, home medical equipment, oxygen and physiotherapy services. Included in this offering are many other ancillary services such as occupational therapy, foot care, massage therapy etc. that seniors and Homes can utilize. These same services will be made available to the greater population of Canada. We are continuing to evolve our seniors' Physiotherapy business to align with the priorities of the MOHLTC and provide continued quality services to seniors."
Centric Health began offering bundled services to Long-Term Care and Retirement Homes in the second quarter of 2012. Since September 2012, the Company has added more than 130 new service contracts under its Bundled Services program.
With respect to Centric Health's five existing OHIP physiotherapy clinics, there is a proposed new model where these clinics would enter into a transfer payment agreement with the MOHLTC to be grandfathered in to the new system for a period of time if the proposed changes occur as of August 1, 2013.
The proposed changes to the funding model by MOHLTC will have little to no impact on the Company's 105 owned and 36 network physiotherapy clinics across Canada, which generated revenue of approximately $124.6 million in 2012, primarily through insurers and private pay.
Centric Health reaffirmed its focus on quality patient care in response to the proposed changes.
"Our priority continues to be maintaining the high quality of the physiotherapy and related services we deliver to more than 50,000 residents in Long-Term Care and Retirement Homes across Ontario," said Mr. Cutler. "Proposed changes by the MOHLTC to the funding model will have no impact on our standards of excellence as we continue to partner with healthcare professionals in providing the highest levels of rehabilitation and restorative care services and outcomes to senior's entrusted with our care."
About Centric Health
Centric Health's vision is to be Canada's premier healthcare company, providing innovative solutions centered on patients and healthcare professionals. As a diversified healthcare company with investments in several niche service areas, Centric Health currently has operations in medical assessments, disability and rehabilitation management, physiotherapy and surgical centres, homecare, specialty pharmacy and wellness and prevention. With knowledge and experience of healthcare delivery in international markets and extensive and trusted relationships with payers, physicians, and government agencies, Centric Health is pursuing expansion opportunities into other healthcare sectors to create value for all stakeholders with an unwavering commitment to the highest quality of care. Centric Health is listed on the TSX under the symbol CHH. For further information, please visit www.centrichealth.ca.
This press release contains statements that may constitute "forward-looking statements" within the meaning of applicable Canadian securities legislation. These forward-looking statements include, among others, statements regarding business strategy, plans and other expectations, beliefs, goals, objectives, information and statements about possible future events. Readers are cautioned not to place undue reliance on such forward-looking statements. Forward-looking statements are based on current expectations, estimates and assumptions that involve a number of risks, which could cause actual results to vary and in some instances to differ materially from those anticipated by Centric Health and described in the forward-looking statements contained in this press release. No assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do so, what benefits Centric Health will derive there-from.
SOURCE: Centric Health Corporation
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