A new healthcare company with history
Gentiva Health Services has its roots in the former Olsten Corporation, which was divided between its health care division and its staffing offices. Founded by William Olsten in 1950, the company expanded throughout the 1980s and 1990s by acquiring smaller competitors. In 1999, Olsten ranked as the third largest temp agency in the country when the Swiss staffing agency, Adecco, purchased Olsten's staffing and information technology services for $840 million. Gentiva Health Services was spun off as an independent company and remains the largest provider of home health care and related services in North America.
Health nuts
Olsten first entered the health care services market in 1971. The company was the first in the industry to top the $1 billion mark in revenue and it offers a range of services, including skilled nursing (Gentiva is the largest employer of nurses in the U.S.), pediatric and perinatal care, infusion therapy, and others. It expanded its operations further in 1998, acquiring Columbia/HCA Healthcare Corp.'s Florida home health care business, as well as entering into an agreement to provide certain health services to First Health Group Corp.'s 14 million members.
Not so healthy after all
In its most recent Customer Satisfaction survey, then-Olsten Health Care Services scored high marks across the board. Well over 90 percent of patients reported that Gentiva's caregivers were skilled, that treatment was readily available and convenient, and that they would recommend similar services to a friend or family member. But despite the good report card, all is not well with the business. The company has had to defend itself against a number of class-action lawsuits alleging improper Medicare billings. It admitted no wrongdoing, but still faced multimillion dollar settlements. Sales for the health services company fell 21 percent in 1998 (causing the company's stock price to tumble) as competition increased and Medicare reimbursements were cut. Nowhere were Gentiva's woes more apparent than in net income, which dropped 95 percent overall from the previous year. The company announced that it would close 60 U.S offices, costing numerous jobs (the actual figure was not disclosed). In order to right the ship, in October 1998 Edward A. Blechschmidt replaced longtime Chairman and CEO Frank Liguori.
Promoting a new name
With its new name, new logo, and new management, still headed by Blechschmidt, Gentiva seems to be back on track. The company is rolling out a new ad campaign to gain name recognition nationally and is undergoing discussions to sell its healthcare staffing business. The new company still retains 400 offices, 38 pharmacies including two national distribution centers, and a caregiver staff of more than 50,000 in the US and Canada.
