Lincare earnings solid, for now

Net revenues and profits are up this quarter for Lincare Holdings Inc., but executives are already focusing on potential changes to the company's business model in 2011.

In the second quarter of this year, ended June 30, Lincare generated $418.4 million in net revenues, leading to a net income gain of $46.4 million. Those numbers are up 10% and 39% respectively from 2009. Combined with its first quarter total, Lincare has generated $90.1 million in net income so far in 2010. That represents a 52% increase from last year's profits.

However, a new system for bidding on markets may impact Lincare's business in 2011.

The Centers for Medicare and Medicaid Services has initiated a new bidding program for durable medical equipment, which Lincare provides, for 2011, and the results of those bids have been tabulated. Lincare was offered contracts to provide services for only two of the nine markets on which it bid (Charlotte and Miami), leaving the firm in a potentially difficult situation.

“We have serious concerns about the care that will be available to similar patients in the other seven markets,” said John Byrnes, CEO at Lincare, in a release. Byrnes later urged CMS to review its bidding policies, but no changes are pending.

Headquartered in Clearwater, Lincare Holdings Inc. specializes in the provision of respiratory therapy services to in-home patients.