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had been discussions of a PPS for several years, Congress had
passed no such legislation at the time of the transfer, and there
is no evidence that the prospect of such legislation had a
negative effect upon the value of home health care agencies. In
fact, one of Hahn’s articles, published in the Spring of 1998,
demonstrates a “furious pace of home health transfers” from 1994
through 1997. The article contains a chart showing that the
number of home health agency transfers did not begin to decrease
until the second quarter of 1997. A “best case” scenario would,
we think, indicate at least a 2-year value for the cost gap
asset. By using a 2-year figure in Hahn’s computations, we
arrive at a value of more than $1 million for the cost-shifting
attribute.
Hahn’s valuation of the intangible assets also fails to
address the value of the CONs held by the Sta-Home tax-exempt
entities. These certificates effectively closed the home health
care market to competition during a period of high growth for the
industry. Michael Caracci acknowledged his efforts to lobby the
Mississippi legislature in the interests of keeping the CON
moratorium in place, thus preserving the monopoly of the Sta-Home
tax-exempt entities and others who had received CONs before the
moratorium. His efforts indicate that the CONs possessed by the
Sta-Home tax-exempt entities would be worth considerable amounts
to a willing buyer, but Hahn did not ascribe any value to them.
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