Amedisys Reports Fourth Quarter Revenue and Earnings and Issues 2011 Guidance

Amedisys, Inc. (NASDAQ: AMED), a leading home health and hospice company, today reported its financial results for the fourth quarter and year ended December 31, 2010 and issues guidance for 2011.

Three-Month Periods Ended December 31, 2010 and 2009

• Net service revenue of $394.3 million compared to $405.5 million in 2009, a decrease of $11.2 million or 2.8%. Same store agencies decreased $8.0 million and $11.5 million of the decrease related to agencies closed during the year offset by $8.3 million in revenue related to start-up and acquisition agencies.

• Net income attributable to Amedisys, Inc. of $22.1 million compared to $37.8 million in 2009, a decrease of $15.7 or 41.5%.

• Diluted earnings per share of $0.77 compared to $1.35 per diluted share in 2009, a decrease of 43.0%. The weighted average number of diluted shares outstanding increased to approximately 28.5 million compared to 28.1 million in 2009.

• Earnings before interest, taxes, depreciation and amortization ("EBITDA”) of $47.6 million compared to $71.3 million in 2009, a decrease of 33.2%.

• After adding back $8.5 million ($5.2 million, net of income tax) or $0.18 per diluted share in certain items*, the following would have been our adjusted results:

• Net income attributable to Amedisys, Inc. of $27.3 million compared to $37.8 million in 2009, a decrease of 27.9%.

• Diluted earnings per share of $0.95 compared to $1.35 per diluted share in 2009, a decrease 29.6%.

• EBITDA of $54.8 million compared to $71.3 million in 2009, a decrease of 23.2%.

Twelve-Month Periods Ended December 31, 2010 and 2009

• Net service revenue of $1.6 billion compared to $1.5 billion in 2009, an increase of $120.8 million or 8.0%. Same store agencies increased $71.4 million and $70.9 million of the increase is related to start-up and acquisition agencies offset by $21.5 million decrease in revenue from closed agencies.

• Net income attributable to Amedisys, Inc. of $112.6 million compared to $135.8 million in 2009, a decrease of $23.2 or 17.1%.

• Diluted earnings per share of $3.95 compared to $4.89 per diluted share in 2009, a decrease of 19.2%. The weighted average number of diluted shares outstanding increased to approximately 28.5 million compared to 27.8 million in 2009.

• EBITDA of $228.2 million compared to $261.8 million in 2009, a decrease of 12.8%.

• After adding back $15.9 million ($9.7 million, net of income tax) or $0.34 per diluted share in certain items*, the following would have been our adjusted results:

• Net income attributable to Amedisys, Inc. of $122.3 million compared to $135.8 million in 2009, a decrease of 10.0%.

• Diluted earnings per share of $4.29 compared to $4.89 per diluted share in 2009, a decrease 12.3%.

• EBITDA of $242.0 million compared to $261.8 million in 2009, a decrease of 7.6%.

* See footnote 2 on page 11 for explanation of these certain items.

William F. Borne, Chief Executive Officer of Amedisys, Inc. stated, "We responded to a number of operational issues in 2010. Many of the actions we initiated in the third quarter contributed to the improved earnings in the fourth quarter and will continue to have a positive impact in 2011. These actions have resulted in a stronger operational infrastructure to grow the business and continue to enhance the quality of care we provide our patients.”

2011 Guidance

• Net service revenue is anticipated to be in the range of $1.600 billion to $1.650 billion, excluding the effects of future acquisitions, if any are made.

• Diluted earnings per share is expected to be in the range of $3.00 to $3.30 based on an estimated 29.3 million shares outstanding. This guidance does not include the effects of any share repurchases, future acquisitions, any non-recurring costs that may be incurred during the year or the impact of any future Medicare rate changes.

We urge caution in considering the current trends and 2011 guidance disclosed in this press release. The home health and hospice industry is highly competitive and subject to intensive regulations, and trends and guidance are subject to numerous factors, risks, and uncertainties, some of which are referenced in the cautionary language below and others that are described more fully in our reports filed with the Securities and Exchange Commission ("SEC”) including our Annual Report on Form 10-K for the fiscal year ended December 31, 2010, and subsequent Quarterly Reports on Form 10-Q, and current reports on Form 8-K which can be found on the SEC’s internet website, http://www.sec.gov, and our internet website, http://www.amedisys.com. We disclaim any obligations to update disclosed information on trends.

Earnings Call and Webcast Information

To participate in the conference call, please dial (800) 967-7149 (Toll free) or (719) 325-2354 (Toll) a few minutes before 10:00 a.m. ET on Tuesday, February 22, 2011. A replay of the conference call will be available through March 1, 2011. The replay dial in number is (888) 203-1112 (Toll free) or (719) 457-0820 (Toll). The replay pin number is 9080078.

The call will also be available through our website and for seven days thereafter at the following web address: http://www.amedisys.com/investors.

We are headquartered in Baton Rouge, Louisiana. Our common stock trades on the NASDAQ Global Select Market under the symbol "AMED.”

Additional 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.

Forward-Looking Statements

When included in this press release, 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 agencies, acquire additional agencies and integrate and operate these agencies 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, changes in or developments with respect to any litigation or investigations relating to the Company, including the United States Senate Committee on Finance inquiry, the SEC investigation and the U.S. Department of Justice Civil Investigative Demand 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.

Non-GAAP Financial Measures

This press release includes the following non-GAAP financial measures as defined under SEC rules: EBITDA, defined as net income attributable to Amedisys, Inc. before provision for income taxes, net interest expense and depreciation and amortization, adjusted EBITDA, defined as EBITDA plus certain items, adjusted net income attributable to Amedisys, Inc., defined as net income attributable to Amedisys, Inc. plus certain items and adjusted diluted earnings per share, defined as diluted earnings per share plus the earnings per share effect of certain items. In accordance with SEC rules, we have provided herein a reconciliation of these non-GAAP financial measures to the most directly comparable measures under generally accepted accounting principles ("GAAP”). Management believes that these are useful gauges of our performance and are common measures used in our industry to assess relative financial performance among companies.

AMEDISYS, INC. AND SUBSIDIARIES SELECT CONSOLIDATED FINANCIAL STATEMENT DATA AND SUPPLEMENTAL INFORMATION (Amounts in thousands, except per share data and statistical information) (Unaudited)
Balance Sheet Information
			As of December 31,
				2010						2009
ASSETS
Current assets:
Cash and cash equivalents			$	120,295					$	34,485
Patient accounts receivable, net of allowance for doubtful accounts of $20,977 and $26,371				141,549						150,269
Prepaid expenses				9,947						10,279
Other current assets				22,139						23,003
Total current assets				293,930						218,036
Property and equipment, net of accumulated depreciation of $78,074 and $59,780				138,554						91,919
Goodwill				791,412						786,923
Intangible assets, net of accumulated amortization of $17,135 and $11,826				53,393						57,608
Other assets, net				22,536						17,865
Total assets			$	1,299,825					$	1,172,351
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable			$	23,374					$	16,535
Payroll and employee benefits				100,700						119,619
Accrued expenses				36,149						33,035
Obligations due Medicare				4,618						4,618
Current portion of long-term obligations				37,178						44,254
Current portion of deferred income taxes				14,285						11,245
Total current liabilities				216,304						229,306
Long-term obligations, less current portion				144,688						170,899
Deferred income taxes				52,286						29,399
Other long-term obligations				6,832						6,412
Total liabilities				420,110						436,016
Commitments and Contingencies
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; 29,867,701 and 28,303,216 shares issued; and 29,232,807 and 28,191,174 shares outstanding				29						28
Additional paid-in capital				407,156						363,670
Treasury stock at cost, 634,894 and 112,042 shares of common stock				(14,022	)					(735	)
Accumulated other comprehensive income				25						114
Retained earnings				484,669						372,089
Total Amedisys, Inc. stockholders’ equity				877,857						735,166
Noncontrolling interests				1,858						1,169
Total equity				879,715						736,335
Total liabilities and equity			$	1,299,825					$	1,172,351

Income Statement Information
				For the three-month periods ended December 31,												For the Years Ended December 31,
					2010						2009						2010						2009
Net service revenue				$	394,323					$	405,472					$	1,634,319					$	1,513,459
Cost of service, excluding depreciation and amortization					200,784						197,370						820,460						724,465
General and administrative expenses:
Salaries and benefits					90,439						85,398						357,502						327,738
Non-cash compensation					2,317						2,108						10,634						7,848
Other					47,786						45,714						198,410						174,170
Provision for doubtful accounts					5,145						3,697						19,214						20,178
Depreciation and amortization					9,292						7,630						34,589						28,312
Operating expenses					355,763						341,917						1,440,809						1,282,711
Operating income					38,560						63,555						193,510						230,748
Other (expense) income:
Interest income					61						52						435						213
Interest expense					(2,163	)					(2,575	)					(9,201	)					(11,670	)
Equity in earnings from unconsolidated joint ventures					706						622						3,016						2,343
Miscellaneous, net					(739	)					(219	)					(2,178	)					760
Total other expense, net					(2,135	)					(2,120	)					(7,928	)					(8,354	)
Income before income taxes					36,425						61,435						185,582						222,394
Income tax expense					(14,156	)					(23,397	)					(72,309	)					(86,171	)
Net income					22,269						38,038						113,273						136,223
Net (income) loss attributable to noncontrolling interests					(171	)					(246	)					(693	)					(386	)
Net income attributable to Amedisys, Inc.				$	22,098					$	37,792					$	112,580					$	135,837
Net income per share attributable to Amedisys, Inc. common stockholders:
Basic				$	0.79					$	1.37					$	4.02					$	4.99
Diluted				$	0.77					$	1.35					$	3.95					$	4.89
Weighted average shares outstanding:
Basic					28,105						27,607						28,032						27,231
Diluted					28,528						28,095						28,484						27,759

Cash Flow Information
			For the three-month periods ended December 31,												For the Year Ended December 31,
				2010						2009						2010						2009
Net cash provided by operating activities			$	33,665					$	28,737					$	206,273					$	247,659
Net cash (used in) investing activities				(31,956	)					(32,484	)					(73,616	)					(97,255	)
Net cash used in financing activities				(9,451	)					(6,928	)					(46,847	)					(118,766	)
Net increase (decrease) in cash and cash equivalents				(7,742	)					(10,675	)					85,810						31,638
Cash and cash equivalents at beginning of period				128,037						45,160						34,485						2,847
Cash and cash equivalents at end of period			$	120,295					$	34,485					$	120,295					$	34,485

Supplemental Information – Home Health
			For the Three-Months Ended March 31,
			2010																							2009
			Same Store						Startups/ Acquisitions						Exit Activity (1)						Total					Same Store					Other (2)						Total
Financial Information (in millions):
Episodic-based revenue			$	343.1					$	18.6					$	—					$	361.7				$	301.8				$	2.8					$	304.6
Non-episodic revenue				17.5						1.3						—						18.8					16.2					0.7						16.9
Net service revenue				360.6						19.9						—						380.5					318.0					3.5						321.5
Same store episodic-based revenue growth (3)				14	%
Cost of service				174.6						12.4						—						187.0					150.6					2.9						153.5
Gross Margin				186.0						7.5						—						193.5					167.4					0.6						168.0
Other operating expenses				83.1						10.5						0.1						93.7					76.6					4.0						80.6
Operating income			$	102.9					$	(3.0	)				$	(0.1	)				$	99.8				$	90.8				$	(3.4	)				$	87.4
Key Statistical Data:
Admissions:
Episodic-based				61,340						3,938						—						65,278					55,682					430						56,112
Non-episodic				9,085						907						—						9,992					9,419					72						9,491
Total admissions				70,425						4,845						—						75,270					65,101					502						65,603
Same store episodic-based admission growth (3)				10	%
Recertifications:
Episodic-based				48,004						1,711						—						49,715					48,374					390						48,764
Non-episodic				4,740						156						—						4,896					5,744					25						5,769
Total recertifications				52,744						1,867						—						54,611					54,118					415						54,533
Same store episodic-based recertification growth (3)				(1	)%
Completed Episodes:
Episodic-based				100,261						4,835						—						105,096					95,259					1,040						96,299
Visits:
Episodic-based				1,998,384						92,869						—						2,091,253					1,806,274					16,291						1,822,565
Non-episodic				196,715						11,357						—						208,072					193,606					2,749						196,355
Total visits				2,195,099						104,226						—						2,299,325					1,999,880					19,040						2,018,920
Cost per Visit			$	79.53					$	119.00					$	—					$	81.32				$	75.32				$	146.60					$	76.05
Episodic-based visits per completed episode (4)				18.7						16.9						—						18.6					17.7					17.2						17.7
			For the Three-Months Ended June 30,
			2010																							2009
			Same Store						Startups/ Acquisitions						Exit Activity (1)						Total					Same Store					Other (2)						Total
Financial Information (in millions):
Episodic-based revenue			$	356.2					$	13.1					$	—					$	369.3				$	335.0				$	2.7					$	337.7
Non-episodic revenue				17.7						1.0						—						18.7					16.9					0.1						17.0
Net service revenue				373.9						14.1						—						388.0					351.9					2.8						354.7
Same store episodic-based revenue growth (3)				6	%
Cost of service				181.0						9.7						—						190.7					163.9					2.4						166.3
Gross Margin				192.9						4.4						—						197.3					188.0					0.4						188.4
Other operating expenses				87.7						10.7						0.6						99.0					82.5					4.6						87.1
Operating income			$	105.2					$	(6.3	)				$	(0.6	)				$	98.3				$	105.5				$	(4.2	)				$	101.3
Key Statistical Data:
Admissions:
Episodic-based				60,110						2,966						—						63,076					57,835					374						58,209
Non-episodic				9,382						706						—						10,088					8,884					59						8,943
Total admissions				69,492						3,672						—						73,164					66,719					433						67,152
Same store episodic-based admission growth (3)				4	%
Recertifications:
Episodic-based				46,375						1,195						—						47,570					51,211					296						51,507
Non-episodic				4,609						127						—						4,736					5,501					25						5,526
Total recertifications				50,984						1,322						—						52,306					56,712					321						57,033
Same store episodic-based recertification growth (3)				(9	)%
Completed Episodes:
Episodic-based				105,676						3,744						—						109,420					101,430					779						102,209
Visits:
Episodic-based				2,037,881						69,572						—						2,107,453					1,956,014					11,787						1,967,801
Non-episodic				203,229						10,054						—						213,283					214,973					2,741						217,714
Total visits				2,241,110						79,626						—						2,320,736					2,170,987					14,528						2,185,515
Cost per Visit			$	80.75					$	122.36					$	—					$	82.18				$	75.48				$	168.46					$	76.10
Episodic-based visits per completed episode (4)				19.4						17.3						—						19.4					18.6					16.9						18.6

			For the Three-Months Ended September 30,
			2010																							2009
			Same Store						Startups/ Acquisitions						Exit Activity (1)						Total					Same Store					Other (2)						Total
Financial Information (in millions):
Episodic-based revenue			$	336.9					$	12.3					$	—					$	349.2				$	339.5				$	3.4					$	342.9
Non-episodic revenue				18.1						1.2						—						19.3					16.2					0.3						16.5
Net service revenue				355.0						13.5						—						368.5					355.7					3.7						359.4
Same store episodic-based revenue growth (3)				(1	)%
Cost of service				177.2						9.0						—						186.2					166.0					2.7						168.7
Gross Margin				177.8						4.5						—						182.3					189.7					1.0						190.7
Other operating expenses				87.6						9.9						3.4						100.9					82.4					5.0						87.4
Operating income			$	90.2					$	(5.4	)				$	(3.4	)				$	81.4				$	107.3				$	(4.0	)				$	103.3
Key Statistical Data:
Admissions:
Episodic-based				60,556						2,916						—						63,472					57,087					680						57,767
Non-episodic				9,621						791						—						10,412					8,508					129						8,637
Total admissions				70,177						3,707						—						73,884					65,595					809						66,404
Same store episodic-based admission growth (3)				6	%
Recertifications:
Episodic-based				44,804						1,127						—						45,931					52,348					486						52,834
Non-episodic				4,453						141						—						4,594					5,090					86						5,176
Total recertifications				49,257						1,268						—						50,525					57,438					572						58,010
Same store episodic-based recertification growth (3)				(14	)%
Completed Episodes:
Episodic-based				101,379						3,618						—						104,997					103,979					1,128						105,107
Visits:
Episodic-based				1,986,014						66,353						—						2,052,367					2,020,117					18,753						2,038,870
Non-episodic				197,200						11,041						—						208,241					191,326					6,394						197,720
Total visits				2,183,214						77,394						—						2,260,608					2,211,443					25,147						2,236,590
Cost per Visit			$	81.17					$	116.62					$	—					$	82.38				$	75.08				$	108.07					$	75.45
Episodic-based visits per completed episode (4)				19.2						16.9						—						19.1					18.7					16.2						18.7
			For the Three-Months Ended December 31,
			2010																							2009
			Same Store						Startups/ Acquisitions						Exit Activity (1)						Total					Same Store					Other (2)						Total
Financial Information (in millions):
Episodic-based revenue			$	331.9					$	6.4					$	—					$	338.3				$	345.8				$	10.0					$	355.8
Non-episodic revenue				17.9						0.2						—						18.1					17.5					0.5						18.0
Net service revenue				349.8						6.6						—						356.4					363.3					10.5						373.8
Same store episodic-based revenue growth (3)				(4	)%
Cost of service				176.1						4.6						—						180.7					173.9					7.7						181.6
Gross Margin				173.7						2.0						—						175.7					189.4					2.8						192.2
Other operating expenses				85.9						5.4						4.0						95.3					81.3					8.2						89.5
Operating income			$	87.8					$	(3.4	)				$	(4.0	)				$	80.4				$	108.1				$	(5.4	)				$	102.7
Key Statistical Data:
Admissions:
Episodic-based				60,500						1,437						—						61,937					57,887					1,807						59,694
Non-episodic				10,044						115						—						10,159					9,215					237						9,452
Total admissions				70,544						1,552						—						72,096					67,102					2,044						69,146
Same store episodic-based admission growth (3)				5	%
Recertifications:
Episodic-based				44,779						755						—						45,534					50,265					1,387						51,652
Non-episodic				4,393						46						—						4,439					5,112					73						5,185
Total recertifications				49,172						801						—						49,973					55,377					1,460						56,837
Same store episodic-based recertification growth (3)				(11	)%
Completed Episodes:
Episodic-based				103,443						2,032						—						105,475					105,148					3,212						108,360
Visits:
Episodic-based				1,952,738						37,290						—						1,990,028					1,997,040					55,212						2,052,252
Non-episodic				192,445						2,407						—						194,852					200,622					8,247						208,869
Total visits				2,145,183						39,697						—						2,184,880					2,197,662					63,459						2,261,121
Cost per Visit			$	82.09					$	115.13					$	—					$	82.69				$	79.09				$	120.88					$	80.26
Episodic-based visits per completed episode (4)				19.2						18.4						—						19.2					19.0					17.6						19.0

			For the Year Ended December 31,
			2010																							2009
			Same Store						Startups/ Acquisitions						Exit Activity (1)						Total					Same Store					Other (2)						Total
Financial Information (in millions):
Episodic-based revenue			$	1,368.1					$	50.4					$	—					$	1,418.5				$	1,322.1				$	18.9					$	1,341.0
Non-episodic revenue				71.2						3.7						—						74.9					66.8					1.6						68.4
Net service revenue				1,439.3						54.1						—						1,493.4					1,388.9					20.5						1,409.4
Same store episodic-based revenue growth (3)				3	%
Cost of service				708.9						35.7						—						744.6					654.4					15.7						670.1
Gross Margin				730.4						18.4						—						748.8					734.5					4.8						739.3
Other operating expenses				344.3						36.5						8.1						388.9					322.8					21.8						344.6
Operating income			$	386.1					$	(18.1	)				$	(8.1	)				$	359.9				$	411.7				$	(17.0	)				$	394.7
Key Statistical Data:
Admissions:
Episodic-based				242,506						11,257						—						253,763					228,491					3,291						231,782
Non-episodic				38,132						2,519						—						40,651					36,026					497						36,523
Total admissions				280,638						13,776						—						294,414					264,517					3,788						268,305
Same store episodic-based admission growth (3)				6	%
Recertifications:
Episodic-based				183,962						4,788						—						188,750					202,198					2,559						204,757
Non-episodic				18,195						470						—						18,665					21,447					209						21,656
Total recertifications				202,157						5,258						—						207,415					223,645					2,768						226,413
Same store episodic-based recertification growth (3)				(9	)%
Completed Episodes:
Episodic-based				410,759						14,229						—						424,988					405,816					6,159						411,975
Visits:
Episodic-based				7,975,017						266,084						—						8,241,101					7,779,445					102,043						7,881,488
Non-episodic				789,589						34,859						—						824,448					800,527					20,131						820,658
Total visits				8,764,606						300,943						—						9,065,549					8,579,972					122,174						8,702,146
Cost per Visit			$	80.88					$	118.77					$	—					$	82.13				$	76.26				$	127.91					$	77.00
Episodic-based visits per completed episode (4)				19.2						17.2						—						19.1					18.5					17.2						18.5

(1)		Exit activity includes the results for the periods subsequent to the agencies closures or consolidations.
(2)		Agencies for the prior period which are not considered same store agencies during 2010 (i.e. agencies closed or consolidated in current period or unopened startups).
(3)		Same store episodic-based revenue, admissions or recertifications growth is the percent increase in our same store episodic-based revenue, admissions or recertifications for the period as a percent of the same store episodic-based revenue, admissions or recertifications of the prior period.
(4)		Episodic-based visits per completed episode as the home health episodic-based visits on completed episodes divided by the home health episodic-based episodes completed during the period.

Supplemental Information – Hospice

			For the Three-Months Ended March 31,
			2010																						2009
			Same Store						Startups/ Acquisitions						Exit Activity (1)					Total					Same Store					Other (2)						Total
Financial Information (in millions):
Medicare revenue			$	25.4					$	5.4					$	—				$	30.8				$	19.1				$	—					$	19.1
Non-Medicare revenue				1.4						0.3						—					1.7					1.2					—						1.2
Net service revenue				26.8						5.7						—					32.5					20.3					—						20.3
Same store medicare revenue growth (3)				33	%
Cost of service				13.4						3.7						—					17.1					11.2					0.3						11.5
Gross margin				13.4						2.0						—					15.4					9.1					(0.3	)					8.8
Other operating expenses				5.8						2.6						—					8.4					5.3					0.4						5.7
Operating income			$	7.6					$	(0.6	)				$	—				$	7.0				$	3.8				$	(0.7	)				$	3.1
Key Statistical Data:
Hospice admits				2,237						556						—					2,793					1,983					—						1,983
Hospice days				195,966						40,553						—					236,519					153,914					—						153,914
Average daily census				2,177						451						—					2,628					1,710					—						1,710
Revenue per day			$	136.54					$	141.08					$	—				$	137.32				$	132.00				$	—					$	132.00
Cost of service per day			$	68.03					$	92.68					$	—				$	72.26				$	73.02				$	—					$	74.68
Average length of stay				89						79						—					87					74					—						74

			For the Three-Months Ended June 30,
			2010																							2009
			Same Store						Startups/ Acquisitions						Exit Activity (1)						Total					Same Store					Other (2)						Total
Financial Information (in millions):
Medicare revenue			$	26.9					$	5.4					$	—					$	32.3				$	22.0				$	—					$	22.0
Non-Medicare revenue				1.7						0.3						—						2.0					1.2					—						1.2
Net service revenue				28.6						5.7						—						34.3					23.2					—						23.2
Same store medicare revenue growth (3)				22	%
Cost of service				14.8						3.8						—						18.6					11.8					0.3						12.1
Gross margin				13.8						1.9						—						15.7					11.4					(0.3	)					11.1
Other operating expenses				5.9						2.7						—						8.6					5.5					0.5						6.0
Operating income			$	7.9					$	(0.8	)				$	—					$	7.1				$	5.9				$	(0.8	)				$	5.1
Key Statistical Data:
Hospice admits				2,364						510						—						2,874					2,146					—						2,146
Hospice days				215,375						42,797						—						258,172					177,248					—						177,248
Average daily census				2,367						470						—						2,837					1,948					—						1,948
Revenue per day			$	132.87					$	133.03					$	—					$	132.90				$	131.90				$	—					$	131.90
Cost of service per day			$	68.63					$	89.07					$	—					$	72.02				$	66.60				$	—					$	68.34
Average length of stay				87						87						—						87					77					—						77
			For the Three-Months Ended September 30,
			2010																							2009
			Same Store						Startups/ Acquisitions						Exit Activity (1)						Total					Same Store					Other (2)						Total
Financial Information (in millions):
Medicare revenue			$	30.7					$	3.5					$	—					$	34.2				$	27.0				$	—					$	27.0
Non-Medicare revenue				1.8						0.2						—						2.0					1.9					—						1.9
Net service revenue				32.5						3.7						—						36.2					28.9					—						28.9
Same store medicare revenue growth (3)				14	%
Cost of service				17.5						2.6						—						20.1					14.6					0.3						14.9
Gross margin				15.0						1.1						—						16.1					14.3					(0.3	)					14.0
Other operating expenses				7.1						2.3						0.3						9.7					6.8					0.7						7.5
Operating income			$	7.9					$	(1.2	)				$	(0.3	)				$	6.4				$	7.5				$	(1.0	)				$	6.5
Key Statistical Data:
Hospice admits				2,432						350						—						2,782					2,339					3						2,342
Hospice days				247,053						26,936						—						273,989					218,112					127						218,239
Average daily census				2,685						293						—						2,978					2,371					1						2,372
Revenue per day			$	131.73					$	134.17					$	—					$	131.97				$	131.34				$	120.17					$	131.34
Cost of service per day			$	70.73					$	96.61					$	—					$	73.28				$	66.77				$	—					$	68.17
Average length of stay				91						61						—						87					84					49						83
Financial Information (in millions):
Medicare revenue			$	34.2					$	1.7					$	—					$	35.9				$	29.2				$	0.9					$	30.1
Non-Medicare revenue				2.0						—						—						2.0					1.5					0.1						1.6
Net service revenue				36.2						1.7						—						37.9					30.7					1.0						31.7
Same store medicare revenue growth (3)				17	%
Cost of service				18.6						1.5						—						20.1					15.1					0.8						15.9
Gross margin				17.6						0.2						—						17.8					15.6					0.2						15.8
Other operating expenses				6.5						1.2						(0.1	)					7.6					7.5					0.9						8.4
Operating income			$	11.1					$	(1.0	)				$	0.1					$	10.2				$	8.1				$	(0.7	)				$	7.4
Key Statistical Data:
Hospice admits				2,905						156						—						3,061					2,431					100						2,531
Hospice days				269,872						12,657						—						282,529					228,457					6,719						235,176
Average daily census				2,933						138						—						3,071					2,483					73						2,556
Revenue per day			$	134.05					$	140.90					$	—					$	134.35				$	135.02				$	136.63					$	135.07
Cost of service per day			$	69.18					$	114.63					$	—					$	71.21				$	65.97				$	120.62					$	67.53
Average length of stay				90						49						—						88					91					58						90

			For the Year Ended December 31,
			2010																2009
			Same Store				Startups/ Acquisitions				Exit Activity (1)				Total				Same Store				Other (2)				Total
Financial Information (in millions):
Medicare revenue			$ 117.2				$ 16.0				$ —				$ 133.2				$ 97.3				$ 0.9				$ 98.2
Non-Medicare revenue			6.9				0.8				—				7.7				5.8				0.1				5.9
Net service revenue			124.1				16.8				—				140.9				103.1				1.0				104.1
Same store medicare revenue growth (3)			20 %
Cost of service			64.3				11.6				—				75.9				52.7				1.7				54.4
Gross margin			59.8				5.2				—				65.0				50.4				(0.7 )				49.7
Other operating expenses			25.3				8.8				0.2				34.3				25.1				2.5				27.6
Operating income			$ 34.5				$ (3.6 )				$ (0.2 )				$ 30.7				$ 25.3				$ (3.2 )				$ 22.1
Key Statistical Data:
Hospice admits			9,938				1,572				—				11,510				8,899				103				9,002
Hospice days			928,266				122,943				—				1,051,209				777,731				6,846				784,577
Average daily census			2,543				337				—				2,880				2,131				19				2,150
Revenue per day			$ 133.68				$ 136.75				$ —				$ 134.04				$ 132.68				$ 136.32				$ 132.71
Cost of service per day			$ 69.22				$ 94.54				$ —				$ 72.18				$ 67.73				$ 246.54				$ 69.29
Average length of stay			89				75				—				87				82				61				82

(1)		Exit activity includes the results for the periods subsequent to the agencies closure or consolidation.
(2)		Agencies for the prior period which are not considered same store agencies during 2010 (i.e. agencies closed or consolidated in current period or unopened startups).
(3)		Same Store Medicare revenue growth is the percent increase in our same store Medicare revenue for the period as a percent of the same store Medicare revenue of the prior period.

AMEDISYS, INC. AND SUBSIDIARIES SELECT CONSOLIDATED KEY STATISTICAL AND FINANCIAL DATA (Financial Data in thousands) (Unaudited)
			For the three-month periods ended December 31,												For the Year Ended December 31,
				2010						2009						2010						2009
Financial Data:
Depreciation and amortization expense			$	9,292					$	7,630					$	34,589					$	28,312
Capital expenditures			$	26,436					$	10,361					$	63,971					$	36,359
Key Statistical Data:
General
Number of home health agencies (1)				486						521						486						521
Number of hospice agencies (1)				67						65						67						65
Number of agencies acquired (2)				1						1						4						20
Number of agencies opened as start-up locations (2)				6						17						48						48
Days revenue outstanding, net (3)				32.8						33.9						32.8						33.9
Same store episodic-based revenue growth (4)				(4	)%					13	%					3	%					16	%
Internal episodic-based revenue growth (5)				(5	)%					15	%					4	%					18	%
Same store episodic-based admission growth(4)				5	%					5	%					6	%					3	%
Internal episodic-based admission growth (5)				4	%					7	%					8	%					6	%
Same store episodic-based recertification growth (4)				(11	)%					1	%					(9	)%					7	%
Internal episodic-based recertification growth (5)				(12	)%					2	%					(9	)%					8	%
Home Health
Average episodic-based revenue per completed episode (6)			$	3,294					$	3,260					$	3,311					$	3,166

(1)		Includes the closure/consolidation of 57 and 78 home health agencies and 6 and 7 hospice agencies during the three and twelve-month periods ended December 31, 2010, respectively.
(2)		Includes both home health and hospice agencies.
(3)		Our calculation of days revenue outstanding, net at December 31, 2010 and 2009 is derived by dividing our ending net patient accounts receivable (i.e. net of estimated revenue adjustments and allowance for doubtful accounts) by our average daily net patient revenue for the three-month period ended December 31, 2010 and 2009, respectively.
(4)		Same store episodic-based revenue, admissions or recertifications growth is the percent increase in our same store episodic-based revenue, admissions or recertifications for the period as a percent of the same store episodic-based revenue, admissions or recertifications of the prior period.
(5)		Internal episodic-based revenue, admission or recertification growth is the percent increase in our base/start-up episodic-based revenue, admissions or recertifications for the period as a percent of the total episodic-based revenue, admissions or recertifications of the prior period.
(6)		Average episodic-based revenue per completed episode is the average episodic-based revenue earned for each episodic-based completed episode of care.

AMEDISYS, INC. AND SUBSIDIARIES RECONCILIATION OF NON-GAAP FINANCIAL MEASURE TO GAAP FINANCIAL STATEMENTS (Amounts in thousands, except per share data) (Unaudited) Earnings before interest, taxes, depreciation and amortization ("EBITDA”) and Adjusted EBITDA
			For the three-month periods ended December 31,											For the Year Ended December 31,
				2010						2009					2010						2009
Net income attributable to Amedisys, Inc.			$	22,098					$	37,792				$	112,580					$	135,837
Add:
Provision for income taxes				14,156						23,397					72,309						86,171
Interest expense, net				2,102						2,523					8,766						11,457
Depreciation and amortization				9,292						7,630					34,589						28,312
EBITDA (1)			$	47,648					$	71,342				$	228,244					$	261,777
Add:
Certain items (2)				8,467						—					15,947						—
Intangible write-off (2)				(1,343	)					—					(2,216	)					—
Adjusted EBITDA (3)			$	54,772					$	71,342				$	241,975					$	261,777
Adjusted Net Income Attributable to Amedisys, Inc. Reconciliation
			For the three-month periods ended December 31,											For the Year Ended December 31,
				2010						2009					2010						2009
Net income attributable to Amedisys, Inc.			$	22,098					$	37,792				$	112,580					$	135,837
Add:
Certain items (2)				5,165						—					9,728						—
Adjusted net income attributable to Amedisys, Inc. (4)			$	27,263					$	37,792				$	122,308					$	135,837
Adjusted Diluted Earnings Per Share Reconciliation
			For the three-month periods ended December 31,											For the Year Ended December 31,
				2010						2009					2010						2009
Net income attributable to Amedisys, Inc. common stockholders - diluted			$	0.77					$	1.35				$	3.95					$	4.89
Add:
Certain items (2)				0.18						—					0.34						—
Adjusted net income attributable to Amedisys, Inc. common stockholders - diluted (5)			$	0.95					$	1.35				$	4.29					$	4.89

(1)		EBITDA is defined as net income attributable to Amedisys, Inc. before provision for income taxes, net interest expense, and depreciation and amortization. EBITDA should not be considered as an alternative to, or more meaningful than, income before income taxes, cash flow from operating activities, or other traditional indicators of operating performance. This calculation of EBITDA may not be comparable to a similarly titled measure reported by other companies, since not all companies calculate this non-GAAP financial measure in the same manner.
(2)		During the three-month period December 31, 2010 we incurred certain costs associated with the realignment of operations including severance and legal expenses related to the United States Senate Committee on Finance inquiry and SEC investigation. We also incurred costs associated with our exit activities for the three-and twelve month periods ended December 31, 2010, which includes $1.3 million and $2.2 million respectively, for the write-off of intangibles. During the three-month period ended September 30, 2010 we settled our Georgia indigent care liability for less than previously accrued and during the three-month period June 30, 2010 we received the Centers for Medicare and Medicaid Services ("CMS”) bonus payments as the result of a pay for performance demonstration. The following details these items for the three and twelve-month periods ended December 31, 2010:

			For the three-month period ended December 31, 2010																		For the Year Ended December 31, 2010
			Income (Expense)						Net of tax						Diluted EPS						Income (Expense)						Net of tax						Diluted EPS
Georgia indigent care liability			$	—					$	—					$	—					$	3,676					$	2,242					$	0.08
CMS bonus payment				—						—						—						3,587						2,188						0.08
Exit activities				(5,261	)					(3,210	)					(0.11	)					(13,601	)					(8,297	)					(0.29	)
Certain costs				(3,206	)					(1,955	)					(0.07	)					(9,609	)					(5,861	)					(0.21	)
Total			$	(8,467	)				$	(5,165	)				$	(0.18	)				$	(15,947	)				$	(9,728	)				$	(0.34	)

(3)		Adjusted EBITDA is defined as net income attributable to Amedisys, Inc. before provision for income taxes, net interest expense, depreciation and amortization plus certain items as described in footnote 2. Adjusted EBITDA should not be considered as an alternative to, or more meaningful than, income before income taxes, cash flow from operating activities, or other traditional indicators of operating performance. This calculation of adjusted EBITDA may not be comparable to a similarly titled measure reported by other companies, since not all companies calculate this non-GAAP financial measure in the same manner.
(4)		Adjusted net income attributable to Amedisys, Inc. is defined as net income attributable to Amedisys, Inc. plus certain items as described in footnote 2. Adjusted net income attributable to Amedisys, Inc. should not be considered as an alternative to, or more meaningful than, income before income taxes, cash flow from operating activities, or other traditional indicators of operating performance. This calculation of adjusted net income attributable to Amedisys, Inc. may not be comparable to a similarly titled measure reported by other companies, since not all companies calculate this non-GAAP measure in the same manner.
(5)		Adjusted diluted earnings per share is defined as diluted earnings per share plus the earnings per share effect of certain items as described in footnote 2. Adjusted diluted earnings per share should not be considered as an alternative to, or more meaningful than, income before income taxes, cash flow from operating activities, or other traditional indicators or operating performance. This calculation of adjusted diluted earnings per share may not be comparable to a similarly titled measure reported by other companies, since not all companies calculate this non-GAAP financial measure in the same manner.