POLITICS

Opmedic Group says in vitro fee cut in Quebec could hurt bottom line

12/22/2011 01:53 EST | Updated 02/21/2012 05:12 EST
MONTREAL - Opmedic Group Group Inc. (TSX:OMG) says its bottom line could be hurt by a 34 per cent cut next year in technical fees paid private clinics in Quebec for in vitro fertilization, or IVF, procedures.

"The announced reduction in rates... will have a negative impact on revenues and the profit margin for our IVF activities in Quebec, which could be mitigated by the ongoing growth in (other) medically assisted procreation activities," chief financial officer Jean-Marc Lachance said in a statement Thursday.

Lachance, who did not put a specific figure on the potential for lost profit, was referring to changes in the fee structure in Quebec under which all expenses for medically assisted procreations are paid to the attending physician who, in turn, remits a portion to the clinic for medical procedure and technical services.

Effective Jan. 1, rates for the technical portion of IVF procedures remitted to private clinics by attending physicians are being reduced to $4,600 from $6,975.

"The impact of this reduction will not affect the attending physicians, who will continue to receive the same fees ...for professional services provided in a hospital or a private clinic," Opmedic said.

"But (it) will reduce the technical portion of the expenses that were payable to the private clinic by the attending physician for all services provided by the private clinic."

The rate decrease does not affect other medically assisted procreation activities such as artificial inseminations and ultrasounds, the rates for which will remain unchanged.

Opmedic provides health-care related services, including surgical and endoscopic facilities, as well as fertility treatments, medical imaging, laboratory services and diagnostic procedures among others.

Shares in the company were down five cents to $3.15 in afternoon trading on the Toronto Stock Exchange.