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Mississippi during the 11-year period ended in 1995. Little
information was available as to these ownership changes, and Hahn
found only two guideline transfers.
Hahn further noted that the Sta-Home tax-exempt entities
were focused almost entirely upon traditional home health care
and depended almost entirely upon Medicare payments. Publicly
traded companies, by contrast, usually utilized traditional home
health care agencies as part of a broader mix of health care
business. Hahn concluded, therefore, that a comparison to
publicly traded companies would not be appropriate to value the
Sta-Home tax-exempt entities, and he instead utilized “readily
available” information on 13 comparable sales derived from
privately held transactions engaged in by those publicly traded
companies. From these privately held transactions, Hahn excluded
sales of privately held home health agencies that provided
sophisticated “infusion or respiratory therapy” because those
could attract reimbursement at a higher rate than those available
to the more traditional home health care agencies such as Sta-
Home.
Principally upon the basis of his adjusted balance sheet and
comparable market computations, Hahn reached an ultimate
conclusion that the Sta-Home tax-exempt entities’ liabilities
exceeded their total tangible and intangible assets by $600,000
to $2,350,000.
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