GenesisCare business comes back to life, won’t offset payments bungle

afr.com:

GenesisCare’s troubled business in the United States, which collapsed into bankruptcy in June, is performing better than expected, helped by cost-cutting ahead of a sales process that will involve splitting its assets.

As bidders eye parts of the US cancer services group, expectations are growing that one option is to divide its portfolio of medical centres into a GoodCo – which would include its massive business in Florida – and a BadCo, which would carry a higher level of debt. Bids are due this month.

GenesisCare founder Dan Collins led the failed push into the US for the cancer care provider.  James Alcock

But GenesisCare has told shareholders that record patient volumes in its Australian business – once considered to be the group’s most profitable – won’t offset the impact of ending its troubled payments system, EasyPay.

The Australian Financial Review revealed in June that, ahead of entering US bankruptcy protection, the company told Australian health officials that it had overcharged Medicare, and stopped using EasyPay, the company’s deferred payment mechanism for radiation oncology services which allowed patients to pay for treatment in instalments. It cited “reliability” in its calculation of out-of-pocket costs for patients.

The companyalso failed to meet the requirements of a government grants program by charging patients in full, rather than bulk-billing.

In an August shareholder email obtained by the Financial Review, GenesisCare said its patient volumes had risen 9 per cent year-on-year.

The company said it remained in discussions with the Health Department and told investors the issues around the Radiation Oncology Health Program Grants Scheme were “industry-wide”. GenesisCare has 31 clinics in Australia