19584--2/28/2007--CHEMED

related topics

{regulation, government, change}

{personnel, key, retain}

{cost, contract, operation}

{cost, regulation, environmental}

{financial, litigation, operation}

{competitive, industry, competition}

{debt, indebtedness, cash}

{provision, law, control}

{acquisition, growth, future}

The agreements and instruments governing our outstanding debt contain restrictions and limitations that could significantly impact our ability to operate our business and adversely affect the price of our Capital Stock. We depend on our management team and the loss of their service could have a material adverse effect on our business, financial condition and results of operations. Environmental compliance costs and liabilities could increase our expenses and adversely affect our financial condition. We are subject to certain anti-takeover statues that might make it more difficult to effect a change in control of the Company. An adverse ruling against us in certain litigation could have an adverse effect on our financial condition and results of operations. We face intense competition from numerous, fragmented competitors. If we do not compete effectively, our business may suffer. Our operations are subject to numerous laws and regulations, exposing us to potential claims and compliance costs that could adversely affect our business. Vitas is highly dependent on payments from Medicare and Medicaid. If there are changes in the rates or methods governing these payments, Vitas net patient service revenue and profits could materially decline. Approximately one-third of Vitas hospice patients reside in nursing homes. Changes in the laws and regulations regarding payments for hospice services and room and board provided to Vitas hospice patients residing in nursing homes could reduce its net patient service revenue and profitability. If Vitas is unable to maintain relationships with existing patient referral sources or to establish new referral sources, Vitas growth and profitability could be adversely affected. Vitas operates in an industry that is subject to extensive government regulation and claims reviews, and changes in law and regulatory interpretations could reduce its net patient service revenue and profitability and adversely affect its financial condition and results of operations. Federal and state legislative and regulatory initiatives relating to patient privacy could require Vitas to expend substantial sums on acquiring, implementing and supporting new information systems, which could negatively impact its profitability. Vitas growth strategies may not be successful, which could adversely affect its business. Vitas loss of key management personnel or its inability to hire and retain skilled employees could adversely affect its business, financial condition and results of operations. A nationwide shortage of qualified nurses could adversely affect Vitas profitability, growth and ability to continue to provide quality, responsive hospice services to its patients as nursing wages and benefits increase. Vitas may not be able to compete successfully against other hospice providers, and competitive pressures may limit its ability to maintain or increase its market position and adversely affect its profitability, financial condition and results of operations. Changes in rates or methods of payment for Vitas services could adversely affect its revenues and profits.

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19584--2/28/2007--CHEMED_CORP