Acquisitions

12 Months Ended

Dec. 31, 2011

Acquisitions [Abstract]

Acquisitions

(5)  Acquisitions

On October 1, 2011, we acquired the operating assets of Harbinger Hospice, Inc., a privately-held, Medicare-certified hospice company that provides services to patients in Ohio, for $1.1 million in cash, excluding transaction costs of $0.1 million, consisting primarily of broker success fees, that were expensed during the fourth quarter of 2011 in accordance with GAAP.  The hospice company's results of operations are included in our consolidated financial statements beginning October 1, 2011.  Pro forma information related to this acquisition is not provided because the impact on our consolidated financial position and results of operations is not significant.

On December 29, 2010 we completed the purchase of a hospice company that operates in Alabama and Georgia for $13.9 million.  The purchase price excludes $0.5 million of transaction costs, which consisted primarily of investment banker success fees that were expensed in the accompanying statements of operations in accordance with GAAP.  The hospice company's results of operations were included in our consolidated financial statements beginning January 1, 2011.  Pro forma information related to this acquisition is not provided because the impact on our consolidated financial position and results of operations is not significant.

We paid a premium (i.e., goodwill) over the fair value of the net tangible and identified intangible assets acquired because we believed the acquisitions of the hospice companies would create the following benefits:  (1) increase the scale of our operations, thus leveraging our corporate and regional infrastructure and (2) expand our hospice operations into a state in which we did not previously have a presence due to limitations with regulatory licensing.  The October 2011 acquisition resulted in $0.4 million of goodwill recognized and we recognized $9.7 million of goodwill for the December 2010.  The goodwill is not deductible for tax purposes.