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     The payable to Medicare also includes a $3.1 million reserve related to amounts owed to Medicare as overpayments for Alliance Home Health, Inc. (“Alliance”), a subsidiary that is in bankruptcy proceedings under Chapter 7 of the U.S. Bankruptcy Code. It is uncertain at this time whether we will have any responsibility for that amount if the debt of the subsidiary is discharged in bankruptcy.

     PPS Payment Adjustments Reserve. The remaining balance of $2.5 million is related to notice from CMS that it intended to make certain recoveries of amounts overpaid to providers for the periods dating from the implementation of PPS on October 1, 2000 through particular dates in 2003 and 2004. The first of these amounts related to partial episode payments whereby a patient was readmitted to home health care prior to the expiration of 60 days from the previous admission date at another home health agency. In such instances, reimbursement for the first agency is reduced. CMS advised the industry that CMS had recently implemented changes to its computer system such that these instances would be adjusted at the time of claim submission on an ongoing basis, and that recovery for prior overpayments would commence in the summer of 2003 and extend over a two-year period. We reserved, based on information supplied by CMS, approximately $1.0 million in 2003 for all claims dating from October 1, 2000. Second, CMS advised the industry that CMS would seek recovery of overpayments that were made for patients who had, within 14 days of such admission, been discharged from inpatient facilities, including hospitals, rehabilitation, and skilled nursing units, and that these recoveries would commence in April 2004. We conducted an analysis of a representative sample of claims where these events had occurred, and estimated that, for periods dating from October 1, 2000 through December 31, 2003, a reserve in the amount of approximately $1.5 million was appropriate.

     Our success depends upon the continued employment of certain members of our senior management team, including our Chairman and Chief Executive Officer, William F. Borne, our President and Chief Operating Officer, Larry R. Graham, and our Chief Financial Officer, Gregory H. Browne. We also depend upon the continued employment of the Senior Vice Presidents that manage several of our key functional areas, including operations, business development, accounting, finance, human resources, marketing, information systems, contracting, and compliance.

     We maintain key employee life insurance of $4.5 million on Mr. Borne’s life and have entered into employment agreements with each of Mr. Borne, Mr. Graham and Mr. Browne. The departure of any member of our senior management team may materially adversely affect our operations.

     On August 23 and October 4, 2001, two class action lawsuits were filed against us and three of our executive officers on behalf of all purchasers of our common stock between November 15, 2000 and June 13, 2001. These suits, which were filed in the United States District Court for the Middle District of Louisiana, have been consolidated and seek damages based on the decline in our stock price following an announced restatement of earnings for the fourth quarter of 2000 and first quarter of 2001. The suits allege that we knew or were reckless in not knowing the facts giving rise to the restatement. No trial date has been set and pre-trial discovery is ongoing. We are vigorously defending these lawsuits, which have been certified as class actions, although we are appealing such determination.

     We believe our existing insurance is sufficient to cover any amounts that may be awarded, and we have not recorded any liabilities in excess of such coverage in our financial statements. Though we believe that the ultimate outcome of these lawsuits will not exceed our insurance coverage, the maximum amount

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     There is a risk that we will be held responsible for some or all of the $4.2 million liability of a bankrupt subsidiary.

We consolidate the net liabilities of Alliance, a bankrupt subsidiary that is no longer in operation, in our consolidated financial statements. It is possible that we could be held responsible for some or all of this amount, and depending upon the outcome of the bankruptcy proceedings, a potentially larger amount.

     Arthur Andersen LLP audited our financial statements for the five years ended December 31, 2001. On June 15, 2002, Arthur Andersen was convicted of obstruction of justice by a federal jury in Houston, Texas in connection with Arthur Andersen’s work for Enron Corp. On September 15, 2002, a federal judge upheld this conviction. Arthur Andersen ceased its audit practice before the Securities and Exchange Commission (“SEC”)SEC on August 31, 2002. Because of the circumstances currently affecting Arthur Andersen LLP, as a practical matter it may not be able to satisfy any claims arising from the provision of auditing services to us, including claims that you may have under applicable securities laws.

Risks Related to This Offering and Ownership of Our Common Stock

     The price of our common stock may be volatile and this may adversely affect our stockholders.

     The price at which our common stock trades may be volatile. The stock market has from time to time experienced significant price and volume fluctuations that have affected the market prices of securities, particularly securities of health care companies. The market price of our common stock may be influenced by many factors, including:

	•	our operating and financial performance;
	•	variances in our quarterly financial results compared to research analyst expectations;
	•	the depth and liquidity of the market for our common stock;
	•	future sales of common stock or the perception that sales could occur;
	•	investor perception of our business and our prospects;
	•	developments relating to litigation or governmental investigations;
	•	changes or proposed changes in health care laws or regulations or enforcement of these laws and regulations, or announcements relating to these matters; or
	•	general economic and stock market conditions.

     In addition, the stock market in general, and the Nasdaq National Market in particular, has experienced price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of health care provider companies. These broad market and industry factors may materially reduce the market price of our common stock, regardless of our operating performance. In the past, securities class-action litigation has often been brought against companies following periods of volatility in the market price of their respective securities. We may become involved in this type of litigation in the future. Litigation of this type is often expensive to defend and may divert our management team’s attention as well as resources from the operation of our business.

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As of substantial amounts of our common stock, or the availability of those shares for future sale, could adversely affect our stock price and limit our ability to raise capital.

     Upon completion of this offering, 14,387,940 (assuming the underwriters do not exercise their over-allotment option)October 22, 2004 there were 15,237,601 shares of our common stock will be outstanding, of which the 2,000,000 shares to be sold in this offering will be freely tradable.outstanding. Also on that date, up to 192,054182,110 shares of our common stock may be issued under our 1998 employee stock purchase plan following this offering.plan. As of August 27,October 22, 2004, 312,655382,689 shares of our common stock were issuable upon the exercise of stock options which were

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OUR BUSINESS

(1)	Since we issued our original prospectus covering the shares subject to warrants held by HCA Inc., we issued HCA additional warrants to purchase our shares. Of those shares, 50,000 remain subject to a warrant as of the date of this prospectus. As of November 4, 2004, HCA owned no other shares of Amedisys common stock.
(2)	Mr. Christos acquired preferred stock warrants from the successor of Hudson Capital Partners, which was listed as a selling shareholder in our original prospectus dated August 23, 2002. The information concerning Mr. Christos’ ownership is dated as of December 17, 2002.
(3)	Since we issued our original prospectus covering these shares on August 23, 2003, warrants owned by Raifinanz AG to purchase 12,250 preferred shares, convertible into 40,833 shares of common stock, have expired. The number of shares shown as offered by Raifinanz AG excludes those 40,833 shares.

     We are oneNone of the nation’s largest providersselling shareholders named above has held or had any position, office, or other material relationship with us or any of home nursing services to Medicare beneficiaries. We deliver a wide range of health-related services in the home to individuals who may be recovering from surgery, have a chronic disabilityour predecessors or terminal illness, or need assistance with the essential activities of daily living. The services we provide include skilled nursing and home health aide services; physical, occupational, and speech therapy; and medically oriented social work to eligible individuals who require ongoing care that cannot be provided effectively by family and friends. In addition, we have developed and offer clinically focused nursing programs in high-cost disease categories, suchour affiliates since 2000, except as diabetes, coronary artery disease, congestive heart failure, orthopedics, wound care, geriatric surgical recovery, and behavioral health. As of July 31, 2004, we operated 94 Medicare-certified home health care nursing locations in the Southern and Southeastern United States consisting of 53 main locations and 41 branch locations. We also operate Medicare-certified hospice locations in two markets and may add hospice locations on a selective basis in the future. We believe our services are attractive to payors and physicians because they combine clinical quality with cost-effectiveness and are accessible 24 hours a day, seven days a week. Our objective is to be the leading provider of high-quality, low-cost home nursing services in each market in which we operate.

     Since 2002, we have generated significant increases in revenue and earnings by focusing on internal growth in our existing markets, opening home nursing locations in new markets, and selectively acquiring home nursing operations. For the six months ended June 30, 2004, we reported net service revenue of $104.2 million, net income of $9.2 million, and earnings per diluted share of $0.72 compared to net service revenue of $63.3 million, net income of $2.7 million, and earnings per diluted share of $0.28 for the same period in 2003. For the year ended December 31, 2003, we reported net service revenue of $142.5 million, net income of $8.4 million, and earnings per diluted share of $0.83 compared to net service revenue of $129.4 million, net income of $0.8 million, and earnings per diluted share of $0.08 for 2002.

Our Market and Opportunity

     Segments within the $45.3 billion home health care industry include: (1) home nursing services, (2) infusion therapy, (3) respiratory therapy, and (4) home medical equipment. Home nursing is by far the largest industry segment, accounting for $33.2 billion, or 73.3% of total market spending, according to 2001 figures from CMS. There are approximately 7,000 Medicare-certified home nursing agencies currently in operation. The home nursing industry is comprised of facility-based and hospital-based agencies owned by publicly-traded and privately-held companies, visiting nurse associations, and nurse registries. Of these, 68% are freestanding agencies and approximately half operate as for-profit entities. The bulk of the home nursing industry is made up of thousands of relatively small local or regional providers, most of which are not well capitalized. The industry remains highly fragmented, and we believe it represents an attractive consolidation opportunity. Although a small number of large, for-profit companies exist, none has a dominant market presence.

     Medicare is the largest single home nursing payor, accounting for $11.4 billion or 34.3% of total home health nursing spending, and this amount is expected to increase substantially, growing to $20.7 billion by 2011, according to 2002 statistics from CMS’ Office of the Actuary. Among other factors, we believe that industry growth primarily is being driven by:follows:

	•	Patient Preference. When possible, patients preferWe entered into a consulting agreement dated March 15, 2000 with Martin Brenner, under which he served for one year as our investor relations and corporate communications liaison in Europe. As part of Mr. Brenner’s compensation, we issued to him warrants to purchase the convenience and comfort15,000 shares of receiving treatmentcommon stock offered by him for resale in their homes. Studies have shown that patients actually respond to treatment more aggressively if they are comfortable in the environment in which they receive care. Continuing advances in pharmaceutical development and medical technology are enabling a growing number of patients to receive treatment in lower intensity settings and, in many cases, to self-administer medications or to do so under the supervision of a qualified caregiver in their home.this prospectus.
	•	Payor Incentives. Continuing economic pressures within the health care industry have led both publicRobert White served as our Senior Vice-President of Business Development until December 2001. We entered into a Loan and private sector payors to implement strategiesSecurity Agreement dated March 22, 2000 with him, under which we borrowed $250,000 from him. As consideration for Mr. White’s obligations under that create incentives for providers to deliver care more efficiently and in the most appropriate setting. This dynamic, combined with theagreement,

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		substantial cost savings that can be realized through treatment at home,we issued him a warrant to purchase the 5,000 shares of our common stock offered by him for resale in this prospectus. The loan has led to increased utilization of home care over the past ten years.been repaid in full.
	•	Demographic Changes.We entered into a Loan and Security Agreement dated March 22, 2000 with June Gorlin, under which we borrowed $750,000 from her. As consideration for Ms. Gorlin’s obligations under that agreement, we issued her a warrant to purchase the 15,000 shares of our common stock offered by her for resale in this prospectus. The populationloan has been repaid in full. Ms. Gorlin is the mother of older Americans is growing at an increasing rate and life expectancies in the United States are increasing. The U.S. Census Bureau estimates the population aged 65 and older will grow 50.8% from its estimated 2003 level of 35.6 million (12.6% of the total population) to 53.7 million (16.5% of the total population) by 2020. In addition, people over the age of 85 currently comprise the fastest growing subset of the population. The U.S. Census Bureau projects an increase in the over-85 population from an estimated 4.7 million in 2003 to 5.9 million in 2011. Over the same period, the over-85 population is expected to increase as a percentage of the over-65 population from 13.2% to 14.6%. The growth in the elderly population and continued aging of these individuals is expected to continue to drive demand for home health services.Robert White.
	•	IncreasesIn connection with our acquisition in Chronic Disease Prevalence. Prolonged life expectancy often results1998 of 83 home care offices from Columbia/ HCA Healthcare Corporation, we entered into a Credit Agreement with HCA and a related promissory note for a portion of the acquisition purchase price, which were terminated in 2000 when we paid HCA $9,000,000 and executed a higher incidenceWarrant Agreement allowing HCA to purchase up to 200,000 shares of chronic conditions and disease. For example, the invention of modern-day antibiotics markedly reduced death dueour common stock. The 50,000 shares offered by HCA for resale in this prospectus are subject to infectious causes, which in turn has leda warrant issued pursuant to an increase in the prevalence of chronic, non-infectious conditions such as coronary artery disease and diabetes. Other examples include success with preventive measures such as the treatment of vascular disease and ability to intervene effectively during acute events such as myocardial infarctions. These interventions have decreased the incidence of death resulting from acute episodes, which has led to the emergence of chronic conditions associated with long-term disease.that Warrant Agreement.

     UseOnly selling shareholders identified in the table above who beneficially own the shares set forth opposite such selling shareholder’s name in the table on the effective date of home nursing services is increasing duethe registration statement of which this prospectus forms a part may sell those securities under the registration statement. Prior to any use of this prospectus in connection with any offering of the shares of common stock by any holder not identified in the table or with respect to shares of common stock not shown in the table, this prospectus will be supplemented or, if required, a post-effective amendment to the rising demand for skilled nursingregistration statement will be filed to set forth the name and related services by an aging population combined with patient and payor preferences for treatment in the home setting when possible. Home nursing spending grew rapidly in the early and mid-1990s, from $3.3 billion in 1990 to $18.8 billion in 1997. BBA was the firstnumber of a seriesshares of legislative and administrative actions designed to rationalize the growth of home health benefit spending by transitioning from a cost-based reimbursement system to PPS. Under home health PPS, which was fully implemented in October 2000, home health agencies are paid a fixed amount for providing an episode of care to a beneficiary. Payments to providers are adjusted to account for differences in individual care plans and for geographic differences in home health agency costs. Episodes of care begin with a patient’s admission and end up to 60 days later, after which most patients complete their course of care and are discharged in one payment episode. If a patient’s care is not completed within 60 days, Medicare allows another episode to begin without a break in care upon recertificationcommon stock beneficially owned by the referring physician. For a fixed episode of care payment, the home health agency provides therapy, skilled nursing, medically oriented social service,selling shareholder intending to sell such shares and home health aide visits to patients in their homes. Home health providers face the risk of loss if their costs exceed these payments, while providers that furnish care for less than the fixed payment rate retain the difference. To earn profits or avoid losses, agencies can control the number of visits, per-visit costs,shares of common stock to be offered. The prospectus supplement or both. This new system encourages efficient deliverythe post-effective amendment, as the case may be, will also disclose whether any such selling shareholder selling in connection with the prospectus supplement or the post-effective amendment, as the case may be, has, during the three years prior to the date of care.the prospectus supplement or the post-effective amendment, as the case may be, had any position, office or other material relationship with us or any of our predecessors or affiliates, if this information has not been disclosed in this prospectus.

Our Competitive StrengthsPLAN OF DISTRIBUTION

Plan of Distribution Applicable to HCA Inc.

     Pursuant to its agreement with us, the shares of HCA Inc. that are covered by this prospectus may be sold by HCA or on its behalf through or to brokers or dealers, or directly to investors pursuant to this prospectus (or another prospectus contained in and forming a part of an effective registration statement under the Securities Act of 1933) or in transactions that are exempt from the requirements of registration under the Securities Act. HCA’s shares may be sold at a fixed price or prices, which may be changed from time to time, at market prices prevailing at the time of such sale, at prices related to such market prices or at negotiated prices. In connection with such sales, distributors’ or sellers’ commission may be paid or allowed. Brokers or dealers may act as agents for HCA, or may purchase shares from HCA as principal and thereafter resell such shares from time to time in or through transactions or distributions (which may involve crosses and block transactions) on national or foreign stock exchanges where trading privileges are available, in the over-the-counter market, in private transactions or in some combination of the foregoing.

We believehave agreed to indemnify HCA, and HCA has agreed to indemnify us, again certain liabilities, including liabilities under the following competitive strengths contributeSecurities Act.

Plan of Distribution Applicable to our strong market share in eachSelling Shareholders Other Than HCA Inc.

     The selling shareholders other than HCA may sell shares of our marketscommon stock directly, through broker-dealers acting as principal or agent or pursuant to a distribution by one or more underwriters on a firm commitment or best efforts basis. Such selling shareholders may sell all or part of their shares in one or more transactions at prices at or related to the then-current market price or at negotiated prices. The

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     The method by which the selling shareholders other than HCA may offer and will enable ussell their shares may include, but are not limited to, grow our business successfully and increase our profitability:the following:

	•	Primary Focussales on Medicare Home Nursing. Our primary focusany securities exchange on which our common stock is on providing home nursing serviceslisted at the time of sale, or through quotation systems in which our common stock is included, at prices and terms then prevailing or at prices related to Medicare beneficiaries, and we derive approximately 92% of our revenues from Medicare. We recruit and retain caregivers who are attentive to, and familiar with, the specialized needs of the elderly population. We have deployed specialized nursing programs that focus on the high-cost diseases and conditions prevalent in the 65 and older demographic segment. We believe these efforts position us as a potential partner for CMS should we be chosen to participate in programs like the Chronic Care Improvement program, a recent CMS initiative focused on introducing disease management services and protocols to Medicare-eligible individuals. Finally, there are other benefits to our Medicare focus. For example, our billing and collections are

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		somewhat simplified compared with other health care industry providers because of our emphasis on Medicare and the PPS reimbursement process.then-current market price;
	•	Proven Operating Model. Our home nursing model balances the benefits of promoting local agency responsibility and accountability for quality of care and operating results with the efficiencies gained from centralizing key administrative functions. Our home health agencies carry locally recognized branding and tailor their respective marketing efforts to address the specific needs of the communities, referral sources, and Medicare beneficiaries they serve. Agency management teams work to establish strong relationshipssales in their communities and with referral sources. To support our local management teams, we have centralized accounting, regulatory, marketing, payroll, intake, billing, collections, risk management, and quality assurance. We have implemented standardized clinical programs across our system and believe this initiative has improved care quality through the implementation of best practices and helps us actively manage risk by ensuring clinical compliance across all of our home health agencies. In addition, our operations typically have access to more resources and financial management expertise than locally-owned competitors.privately negotiated transactions;
	•	Focused Clinical, Operational, and Financial Management. We have invested in information technology and real-time management and monitoring capabilities that allow ussales for their own account pursuant to standardize the care delivered across our system and monitor the status of the patients we treat. Under PPS, the majority of our revenue is pre-determined at admission based on an initial patient assessment and adjusted for patient resource needs, their functional severity and therapy requirements, and the local wage index. Monitoring and controlling the time and costs associated with the care we provide is essential to maintaining our operating margins and profitability. We have generated significant recent admissions growth and have been able to manage that growth due in large part to our real-time monitoring capability. We believe that most competing providers lack the resources to implement similar systems. In addition, we believe that our focus helps us develop important relationships and extensive referral networks within our markets and to attract and retain qualified health care professionals.this prospectus;
	•	Demonstrated Abilitycross or block trades in which broker-dealers will attempt to Identifysell the shares as agent, but may position and Integrate Acquisitions. We haveresell a demonstrated track recordportion of identifying, evaluating, acquiring, and integrating companies in the home nursing market. We have integrated successfully the home health agencies we acquired in 2001, 2002 and 2003 and are in the process of integrating recent acquisitions, including the ten home health agencies and two hospices we acquired from Tenet. We attribute part of our success in integrating these agencies to our rigorous due diligence review prior to completing the acquisitions. We employblock as a disciplined strategy based on defined acquisition criteria including high service quality, a strong referral base, a compatible payor mix, and opportunities for cost savings and significant internal growth. We also develop a comprehensive post-acquisition strategic planprincipal to facilitate the integration of acquired agencies that includes improving agency operations; recruiting qualified nurses and account executives; expanding relationships with local physicians and discharge planners; expanding the breadth and quality of services offered by the agencies; and transitioning acquired operations onto our information technology platform.transaction;
	•	Significant Cash Flow from Operations and Relatively Low Capital Expenditures. We generate significant cash flow from operations due topurchases by broker-dealers who then resell the profitable operation of our business, our relatively low capital expenditure requirements, and the active management of our working capital. Our capital expenditure requirements are low because our services do not require the purchase and replacement of expensive medical equipment. Historically, our capital expenditures have amounted to less than 2.0% of our revenue.shares for their own account;
	•	Patient-Oriented Company Culture. We believe that we have developedbrokerage transactions in which a strong patient-oriented culture that emphasizes quality of care. We communicate frequently with our employees and provide education opportunities along with competitive benefits. We reinforce our culture through an orientation program for new employees and by an ongoing emphasis on the importance of high-quality patient care and the need to remain productive while keeping our costs low. We

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		communicate actively with our employees to keep them informed about corporate events and to solicit feedback regarding ways to improve our services and their working environment. We also provide extensive sales and compliance training for our employees as part of their ongoing education.

Our Strategy

     Our objective is to be the leading provider of high-quality, low-cost home nursing services in each market in which we operate. To achieve this objective, we intend to:

	•	Focus on Medicare-eligible patients. Medicare beneficiaries represent a growing and profitable market for home nursing service providers. Implementation of PPS in the home health care industry has created a relatively stable reimbursement environment that favors companies such as ours that focus on providing high-quality, low-cost home nursing services.broker solicits purchasers;
	•	Emphasize internal growth. We emphasize the internal growth of Medicare patient admissions, which increased approximately 28% for the six months ended June 30, 2004 and 8% for the calendar year ended 2003. We drive internal growth by: (1) maintaining our emphasis on high-quality home nursing care; (2) expanding and enhancing referral relationships in our local and regional markets; (3) continuing to educate referral sources regarding our specialized nursing programs that focus on high-cost diseases; (4) developing strategic partnerships with large hospital systems to increase admission volume; (5) expanding our service coverage areas by developing new locations; and (6) expanding the size and improving the quality of our team of sales executives.
	•	Grow through strategic acquisitions. We believe our focus on Medicare beneficiaries provides us with a strategic advantage when assessing potential acquisitions. The home nursing market is highly fragmented with approximately 7,000 Medicare-certified home nursing agencies across the country. The majority of these home nursing agencies are owned either by hospitals or independent operators. We employ a disciplined strategy based on defined acquisition criteria including high-quality service, a strong referral base, and compatible payor mix. We have completed six acquisitions with twenty-one locations over the past twelve months, and we plan to evaluate and pursue additional hospital-based and multi-site home health agency acquisitions in our target markets. Attractive acquisitions offer prospects for cost efficiencies within our existing markets, opportunities to expand service coverage into contiguous geographic markets, and the ability to achieve economies of scale associated with large, concentrated patient volumes.
	•	Leverage our cost-efficient operating structure. We believe the size and scale of our infrastructure and operating systems offer the opportunity to achieve operating leverage on two levels. At the agency level, we have developed a cost-efficient operating structure for our home nursing locations that focuses on nurse productivity, per episode utilization, and clinical outcomes, among other measures. To manage our diverse network of locations, we use a proprietary information system that reduces administrative and operating costs through the integrationwriting of clinical, financial, and operating functions. We manage all patient care and utilizationoptions on a real-time basis from both a clinical and financial perspective through a system of exception reporting. We believe our operating structure and information systems have facilitated our ability to generate and manage strong internal growth in admissions. Atshares, whether the corporate level, our geographic focus and investment in infrastructure and information systems enable us to leverage our regional and senior management resources and add new nursing locations without proportionate increases in corporate expense.
	•	Continue to develop and deploy specialized nursing programs for chronic diseases and conditions. We have developed specialty nursing services and programs that focusoptions are listed on high-cost diseases and have successfully launched programs for diabetes, coronary artery disease, congestive heart failure, orthopedics, wound care, geriatric surgical recovery, and behavioral health. Our specialty nursing programs represent an attractive growth opportunity because they combine clinical quality and 24-hour access, which is appealing to patients and physicians, with cost-effective delivery of high-quality care to patients who have high-costoptions exchange or chronic conditions.

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Our Home Health Agencies

     As of July 31, 2004, we operated 94 Medicare-certified home health care nursing locations in the Southern and Southeastern United States consisting of 53 main locations and 41 branch locations. A director and team of administrative professionals lead each agency and have primary responsibility for the day-to-day operations. Our agencies are staffed with experienced clinical home health professionals who provide a wide range of patient care services. Our operations are organized into twelve regions, each of which provides clinical, operational, and sales support. To support our local agencies, we have centralized accounting, regulatory, marketing, payroll, intake, billing, collections, risk management, and quality assurance. All of our agencies are accredited or in the process of seeking accreditation by the Joint Commission on Accreditation of Health Care Organizations (“JCAHO”), with the exception of five agencies, which are accredited by the Community Health Accreditation Program.

     We deliver a wide range of health-related services in the home to eligible individuals who require ongoing skilled nursing and associated care that cannot be provided effectively by family and friends. Our patients are typically recovering, disabled, or chronically or terminally ill persons in need of medical, nursing, social, or therapeutic treatment and assistance with the essential activities of daily living.

     We provide a wide variety of home health care services including:

	•	registered nursing services such as infusion therapy, skilled monitoring, assessments, and patient education, many of whom have advanced certifications;
	•	licensed practical (vocational) nursing services, including performance of technical procedures, administration of medications, and changing of surgical and medical dressings;
	•	physical and occupational therapy to strengthen muscles, restore range of motion and help patients perform the activities of daily living;
	•	speech pathology/ therapy to restore communication and oral skills;
	•	social work to help families address the problems associated with acute and chronic illnesses;
	•	home health aid services to perform personal care such as bathing or assistance in walking;otherwise; and
	•	private duty servicesa combination of such as continuous hourly nursing care and sitter services.methods.

Sales and Marketing

     Our sales and marketing efforts are directed primarily at physicians and hospital discharge planners, who are responsible for referring patients to home care agencies. Marketing activities are coordinated locally by the individual agency and are supplemented by regional sales management and dedicated corporate personnel. These activities generally emphasize the benefits offered by our home care agencies as compared to other providers in the market, such as our focus on addressing the unique needs of Medicare beneficiaries; our specialized nursing programs and focus in specific disease and chronic conditions such as diabetes, coronary artery disease and congestive heart failure, orthopedics, and wound care; our ability to schedule and coordinate patient assessment and admission, when appropriate, with little to no inconvenience to the patient; and our size and scale. Although the agency director is the primary point of contact, physicians who utilize our home health agencies are important sources of recommendations to other physicians regarding the benefits of using our services. Each agency director develops a target list of physicians and discharge planners, and we continually review these marketing lists and the agency director’s progress in contacting and successfully attracting additional local referral sources.

Technology

     The development and enhancement of our information technology systems has been, and continues to be a key component of our strategy. We have invested significant time and resources enhancing the capabilities of our technology platform in recent years to gain a strategic advantage over our competitors. We have standardized and are automating most of the critical components of the operational, clinical,

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     We have developedagreed to indemnify Peter N. Christos and utilize a proprietary windows-based clinical software systemRaifinanz AG, and they have agreed to collect assessment data, scheduleindemnify us, against certain liabilities, including certain liabilities under the securities laws.

Other Matters

     In connection with any underwritten offering, underwriters and log patient visits, generate medical orders,their agents may receive compensation in the form of discounts, commissions or concessions from the selling shareholders or from purchasers of shares for whom they act as agents. Underwriters may sell shares to or through dealers, and monitor treatmentsthose dealers may receive compensation in the form of discounts, commissions or concessions from the underwriters or commissions from the purchasers for whom they may act as agents. The selling shareholders and outcomesany underwriters, dealers or agents participating in accordance with established medical standards. The systems integrate billing and collections functionality, as well as accounting, human resource, payroll, and employee benefits programs provided by third parties. Because our home care software has been developed internally, we believe our programmers can add programming enhancements and functionality and integrate software programs from outside vendors more quickly and less expensively than would be the case were our system purchased or leased from a third party. We exchange data electronically with many third party organizations, and all of our information processes use best practices for security and are in compliance with HIPAA guidelines.

     We use document recognition software developed by Healthcare Quality Systems (“HQS”) that enables our agencies to scan assessment forms into our clinical system, which reduces the amount of time spent on data entry, standardizes the data collection process, and significantly reduces the occurrence of data entry errors. Each assessment from our agencies is sent electronically to HQS, which uses proprietary software to review and verify the qualitydistribution of the assessments via a system of smart edits to flag inconsistencies and errors in order to enable our nurses to make necessary corrections. Assessments are then provided to us electronically by HQS and automatically uploaded to our clinical and operational system. Once the data is integrated into our clinical system, it is used in all of our processing functions. Finally, we are in the process of consolidating our various agency databases into an enterprise-wide system that will improve the accuracy, reliability, and efficiency of processing and management reporting. This project is in the parallel testing phase. Following the successful completion of this phase, we will begin an enterprise-wide roll-out.

     We believe that building and enhancing our information systems provides us with a competitive advantage that will allow us to grow our business in a more cost efficient manner.

Compliance and Quality Improvement

     We are a health care services business, and the quality and reputation of our personnel and operations are critical to our success. We develop, implement, and maintain comprehensive compliance and quality improvement programs as a component of the centralized corporate services provided to our 94 home care locations. Our compliance program includes a code of ethical conduct for our employees and affiliates and a process for reporting regulatory or ethical concerns to our Chief Compliance Officer, including a toll-free telephone hotline. We have a Compliance Committee, which is chaired by the Chief Compliance Officer and is comprised of our Chief Executive Officer, Chief Operating Officer, Chief Financial Officer, the Senior Vice President of Clinical Operations, and the Senior Vice President of Human Resources. This Corporate Compliance Committee reviews and recommends appropriate courses of action for the handling of compliance issues.

     The effectiveness of our compliance program is directly related to the legal and ethical training that we provide to our employees. Compliance education for new hires is initiated immediately upon employment with corporate video training and reinforced through regional corporate orientation within one month of an employee’s hire date, when the Chief Compliance Officer conducts a comprehensive compliance training seminar. All newly hired sales employees receive additional training from the Chief Compliance Officer in conjunction with business development orientation. In addition, all of our employees are required to receive continuing compliance education and training each year.

     We conduct periodic compliance surveys of all of our agencies, which include audits of patient charts and documentation to ensure compliance with Medicare regulations. Audit findings and corresponding action plans are routed to both the Chief Compliance Officer and the Senior Vice President of Operations.

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     Our proprietary disease management programs and clinical tracks ensure that consistent quality of care is delivered across the organization. These programs are a critical component of improving patient outcomes. We utilize the federal government’s Outcome Based Quality Improvement Scores and the Home Health Outcome Compare Scores to measure the quality of our services and to monitor the effectiveness of our quality improvement initiatives. We also use outside consultants to provide independent data and analysis to support our quality improvement initiatives. One such consulting firm benchmarks clinical activities and outcomes for all of our agencies against state, regional, and national averages and provides individual agency rankings across a host of categories that enable us to identify trends in the delivery of care to our patients. Another independent firm provides computer software systems that analyze Company billings to ensure that assessment forms are completed properly and that internally mandated assessment methodologies and coding procedures are followed. This software system identifies any assessment or billing trends that are exceptions to corporate guidelines.

     We believe our compliance and quality improvement programs ensure that our employees are well trained so that they can deliver consistent high quality service to our patients. We incorporate compliance staffing and oversight into our growth plans and believe our consistent focus on compliance and quality improvement provides us with a competitive advantage in the market.

Reimbursement

Patient Eligibility

     Medicare is a federally funded and administered health insurance program, primarily for individuals entitled to social security benefits who are 65 or older or who are disabled. The Medicare home health benefit is available to patients who need care following discharge from a hospital, as well as patients who suffer from chronic conditions that require ongoing but intermittent care. The services received need not be rehabilitative or of a finite duration, however, patients who require full-time skilled nursing for an extended period of time generally do not qualify for Medicare home health benefits. As a condition of participation under Medicare, beneficiaries must: (1) be homebound in that they are unable to leave their home without considerable effort; (2) require intermittent skilled nursing, physical therapy, or speech therapy services that are covered by Medicare; and (3) receive treatment under a plan of care that is established and periodically reviewed by a physician. Qualifying patients also may receive reimbursement for occupational therapy, medical social services, and home health aide services if these additional services are part of a plan of care prescribed by a physician. There is no limit to the number of episodes a beneficiary may receive as long as they remain eligible.

Provider Eligibility

     To participate in the Medicare program and receive a Medicare payment, our agencies must comply with regulations promulgated by the Department of Health and Human Services. Among other things, these regulations, known as “conditions of participation,” relate to personnel qualifications, patient rights, standards of medical care, financial reporting, and compliance with state and local laws and regulations. The requirements for certification under Medicare are subject to change, and failure to comply with these requirements could lead to termination of our participation in the Medicare program.

Provider Reimbursement

     Revenue from our home nursing services are paid by Medicare, Medicaid, private insurance carriers, managed care organizations, individuals, and other health insurance programs. Medicare is a federally funded program available to persons with certain disabilities and persons 65 years of age or older.

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     During the 1990s, reimbursement for home nursing services was one of the fastest growing expenditures in Medicare. According to the Medicare Payment Advisory Commission (“MedPAC”), from 1990 to 1997, the number of home health visits reimbursed under the Medicare system nearly doubled, and Medicare home health spending grew at an average annual rate of 25.0%, peaking at approximately $18.0 billion in 1997. The escalating costs and the rapidly growing use of home health services provided a catalyst for legislative action. BBA significantly reduced Medicare reimbursement to home health agencies by eliminating the industry’s cost-based reimbursement methodology and mandating the establishment of PPS, which commenced in October 2000.

     Under PPS, we receive a standard prospective Medicare payment for delivering care over a base 60-day period, or episode of care. Most patients complete treatment within one payment episode, though multiple continuous episodes are allowed. The base payment, which is established through federal legislation, is a flat rate that is adjusted upward or downward to account for differences in the expected resource needs of individual patients as indicated by clinical severity, functional severity, and service utilization. The adjustment is derived from each patient’s categorization into one of 80 payment groups, known as home health resource groups, and the costliness of care for patients in each group relative to the average patient. Our payment is also adjusted for differences in local prices using the hospital wage index.

     We bill and are reimbursed for services in two stages: an initial claim when the episode commences and a final claim when it is completed. We receive 60% of the estimated payment for a patient’s initial episode up-front (after the initial assessment is completed and upon initial billing) and the remaining 40% upon completion of the episode and all final treatment orders are signed by the physician. In the event of subsequent episodes, reimbursement timing is 50% up-front and 50% upon completion of the episode. Final payments may reflect one of five retroactive adjustments to ensure the adequacy and effectiveness of the total reimbursement: (1) an outlier payment if the patient’s care was unusually costly; (2) a low utilization adjustment if the number of visits was fewer than five; (3) a partial payment if the patient transferred to another provider before completing the episode; (4) a change-in-condition adjustment if the patient’s medical status changes significantly, resulting in the need for more or less care; or (5) a payment adjustment based upon the level of therapy services required in the population base. We submit all Medicare claims through a single fiscal intermediary for the federal government.

     The current base payment for Medicare home nursing is $2,213. Since implementation of PPS in October 2000, the base episode payment has varied due to both the impact of annual market basket based increases and Medicare-related legislation. In December 2000, Congress passed the Benefits Improvement and Protection Act, which delayed a BBA-mandated 15.0% reduction until October 1, 2002, restored an annual market basket increase to the base payment, and included a 10.0% add-on payment for services provided in a rural area. Since that time, MedPAC has focused its recommendations on the market basket update and the rural add-on as a primary means for controlling Medicare expenditures for home health services. In December 2003, MMA mandated a reduction in the annual payment increase, resetting the annual payment increase equal to the market basket less 0.8% effective April 1, 2004 through December 31, 2006. MMA also reinstated a rural add-on of 5.0% effective April 1, 2004 through March 31, 2005. In its most recent recommendation to Congress, MedPAC advised the elimination of the annual rate increase based on factors that it believes indicate improving access to home health care, favorable economics for providers, and improving quality of care. The applicability of a change is dependent upon the completion date of the episode, and therefore changes in reimbursement will impact our financial results up to 60 days in advance of the effective rate.

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Government Regulation

     Our home nursing business is highly regulated by federal, state and local authorities. Regulations and policies frequently change, and we monitor changes through trade and governmental publications and associations. We also meet regularly with a group of financial, legal, and regulatory consultants to discuss emerging issues that may affect our business. Our home health care subsidiaries are certified by CMS and are therefore eligible to receive reimbursement for services through the Medicare system.

     Our agencies are subject to federal, state and local laws dealing with issues such as occupational safety, employment, medical leave, insurance, civil rights, discrimination, building codes, and other environmental issues. Federal, state and local governments are expanding the regulatory requirements on businesses. The imposition of these regulatory requirements may have the effect of increasing our operating costs and reducing the profitability of our operations.

     We cannot predict what additional government regulations affecting our business, if any, may be enacted in the future or how existing or future laws and regulations might be interpreted. If we, or any of our agencies, fail to comply with applicable laws, it might have a material adverse effect on our business.

Certificates of Need (“CON”) and Permits of Approval (“POA”)

     Home health care agencies have licenses granted by the health authorities of their respective states. Additionally, some state health authorities require a certificate of need or permit of approval. Tennessee, Georgia, Mississippi, Alabama, North Carolina, and South Carolina require a CON to establish and operate a home health care agency, while Arkansas requires a POA. Louisiana, Oklahoma, Virginia, Texas, and Florida currently do not have such requirements. In every state where required each location license and/or CON or POA issued by the state health authority determines the service areas for the home health care agency. Currently, JCAHO accreditation of home health care agencies is voluntary.

     States with CON and POA laws place limits on the (1) construction and acquisition of health care facilities and operations and (2) the expansion of existing facilities and services. In these states, approvals are required for capital expenditures exceeding amounts that involve certain facilities or services, including home care agencies.

     State CON and POA laws generally provide that, prior to the addition of new capacity, the construction of new facilities or the introduction of new services, a designated state health planning agency must determine that a need exists for those beds, facilities or services. The process is intended to promote comprehensive health care planning, assist in providing high quality health care at the lowest possible cost and avoid unnecessary duplication by ensuring that only those health care facilities and operations that are needed will be built and opened.

     Typically, the provider of services submits an application to the appropriate state agency with information concerning the area and population to be served, the anticipated demand for the facility or service to be provided, the amount of capital expenditure, the estimated annual operating costs, the relationship of the proposed facility or service to the overall state health plan and the cost per patient day for the type of care contemplated. The issuance of a certificate of need is based upon a finding of need by the state agency in accordance with criteria set forth in certificate of need laws and state and regional health facilities plans. If the proposed facility or service is found to be necessary and the applicant to be the appropriate provider, the state agency will issue a certificate of need containing a maximum amount of expenditure and a specific time period for the holder of the certificate of need to implement the approved project. The specific CON or POA application process varies from state to state, and in many jurisdictions the process is competitive, which frequently requires administrative appeals and litigation to reach an ultimate resolution. Where we seek to expand through the CON or POA process, we may incur substantial fees related to the preparation, presentation, and legal defense of our applications.

Medicare Participation

     Approximately 91% of our revenue during 2003 was received from Medicare and we expect to continue to receive the majority of our revenues from serving Medicare beneficiaries. Medicare is a

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Federal and State Anti-Kickback Laws

     As a provider under the Medicare and Medicaid systems, we are subject to the various anti-fraud and abuse laws, including the federal health care programs’ anti-kickback statute and, where applicable, their state law counterparts. These laws prohibit any offer, payment, solicitation, or receipt of any form of remuneration to induce the referral of business reimbursable under a federal health care program or in return for the purchase, lease, order, arranging for, or recommendation of items or services covered by any federal health care programs or any health care plans or programs that are funded by the United States government (other than certain federal employee health insurance benefits) and certain state health care programs that receive federal funds under various programs, such as Medicaid. A related law forbids the offer or transfer of any item or service for less than fair market value, or certain waivers of co-payment obligations, to a beneficiary of Medicare or a state health care program that is likely to influence the beneficiary’s selection of health care providers. Violations of the anti-fraud and abuse laws can result in the imposition of substantial civil and criminal penalties and, potentially, exclusion from furnishing services under any federal health care programs. In addition, the states in which we operate generally have laws that prohibit certain direct or indirect payments or fee-splitting arrangements between health care providers where they are designed to obtain the referral of patients to a particular provider.

Stark Laws

     Congress adopted legislation in 1989, known as the “Stark Law,” that generally prohibits a physician from ordering clinical laboratory services for a Medicare beneficiary where the entity providing that service has a financial relationship (including direct or indirect ownership or compensation relationships) with the physician (or a member of his/her immediate family), and prohibits such entity from billing for or receiving reimbursement for such services, unless a specified exception is available. Additional legislation, known as “Stark II,” became effective January 1, 1993. That legislation extends the Stark law prohibitions to services under state Medicaid programs, and beyond clinical laboratory services to all “designated health services,” including, but not limited to, home health services, durable medical equipment and supplies, and parenteral and enteral nutrients, equipment, and supplies. Violations of the Stark Law may also trigger civil monetary penalties and program exclusion. Pursuant to Stark II, physicians who are compensated by us will be prohibited from seeking reimbursement for designated health services rendered to such patients unless an exception applies. One such exception we use is a safe harbor that allows us to contract with certain physicians at fair market value to provide consulting work to our agencies. Several of the states in which we conduct business have also enacted statutes similar in scope and purpose to the federal fraud and abuse laws and the Stark laws.

     Various federal and state laws impose criminal and civil penalties for submitting false claims for Medicare, Medicaid or other health care reimbursements. We believe that we bill for our services under such programs accurately, although, the rules governing coverage of, and reimbursement for, our services are complex. There can be no assurance that these rules will be interpreted in a manner consistent with our billing practices.

HIPAA

     HIPAA was enacted August 21, 1996 to assure health insurance portability, reduce health care fraud and abuse, guarantee security and privacy of health information and enforce standards for health information. Organizations were required to be in compliance with certain HIPAA provisions relating to

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     Pursuant to the provisions of HIPAA, covered health care providers are required to be compliant with the regulation’s electronic Health Care Transactions and Code Sets Requirements. In conformity with these federal regulations, we are now capable of transmitting in the new standard format.

Insurance

     We maintain liability insurance in amounts that we believe are appropriate for our operations, including professional and general liability insurance, business interruption insurance, property damage insurance, and an additional umbrella liability insurance policy. Coverage under certain of these policies is contingent upon the policy being in effect when a claim is made regardless of when the events that caused the claim occurred. The cost and availability of such coverage has varied widely in recent years. While we believe that our insurance policies are adequate in amount and coverage for our anticipated operation, we cannot assure you that the insurance coverage is sufficient to cover all future claims or will continue to be available in adequate amounts or at a reasonable cost.

     From December 31, 1998 to November 9, 2000, we were covered by Reliance Insurance Company of Illinois (“Reliance”) for risks associated with professional and general liability. We became aware of the deteriorating stability and rating of Reliance during the latter part of 2000 and thus, secured coverage with another insurer on November 9, 2000 for occurrences after that date. Reliance is currently in liquidation and may not be in a position to pay or defend claims we incurred during the period stated above. We have two open claims relating to this period, which we are now defending, and we do not believe that the ultimate resolution of these claims will be materially different from reserves we established for those claims. We are unaware of, and do not expect, any material claims that may be made based on occurrences during the period, but there is no assurance that additional claims will not be brought against us relating to incidents which occurred during the time period stated above or that any such claims will not be material.

Legal Proceedings

     We are involved in legal actions in the normal course of business, some of which seek monetary damages, including claims for punitive damages, which may not be covered by our insurance. These actions, when finally concluded and determined, will not, in our opinion, have a material adverse effect on our financial position, results of operations, or cash flows.

Alliance Home Health, Inc.

     Alliance, one of our wholly-owned subsidiaries, was acquired in 1998 and ceased operations in 1999. Alliance filed for Chapter 7 federal bankruptcy protection with the United States Bankruptcy Court in the Northern District of Oklahoma on September 29, 2000. A trustee was appointed for Alliance in 2001. Until the contingencies associated with the liabilities are resolved, our consolidated financial statements continue to consolidate Alliance, which has net liabilities of $4.2 million.

Class Action Suits

     On August 23 and October 4, 2001, two class action lawsuits were filed against us and three of our executive officers on behalf of all purchasersshares of our common stock between November 15, 2000 and June 13, 2001. These suits, which were filed in the United States District Court for the Middle District of Louisiana, have been consolidated and seek damages based on the decline in our stock price following an announced restatement of earnings for the fourth quarter of 2000 and first quarter of 2001. The suits allege that we knew or were reckless in not knowing the facts giving rise to the restatement. No trial date has been set and pre-trial discovery is ongoing. We are vigorously defending these lawsuits, which have been certified as class actions, although we are appealing such determination.

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     We believe our existing insurance is sufficient to cover any amounts that may be awarded,deemed to be “underwriters” within the meaning of the Securities Act, and we have not recorded any liabilities in excess of such coverage in our financial statements. Though we believe thatprofit from the ultimate outcomesale of these lawsuits will not exceed our insurance coverage,shares by the maximum amount that could potentiallyselling shareholders and any compensation received by any underwriter, broker-dealer or agent may be claimed in these suits substantially exceedsdeemed to be underwriting discounts under the Securities Act. Neither we nor the selling shareholders can presently estimate the amount of our coverage;such profit or compensation.

     From time to time, the selling shareholders may pledge or grant a security interest in some or all of the offered shares. If the selling shareholders default in performance of their secured obligations, the secured parties may offer and sell the offered shares from time to time by this prospectus. The selling shareholders also may transfer and donate offered shares in other circumstances. The number of offered shares will decrease as and when the selling shareholders transfer or donate offered shares or default in performing obligations secured by offered shares. The plan of distribution for the offered shares will otherwise remain unchanged, except that the transferees, donees, pledgees, other secured parties or other successors in interest will be selling shareholders for purposes of this prospectus.

     The selling shareholders may also sell the shares pursuant to Rule 144 adopted under certain circumstances,the Securities Act, as permitted by that rule.

     To the extent required by a finding of liability could have a material adverse effect on our business.

Corporate Integrity Agreement

     In 1999particular offering, we uncovered certain improprieties stemming from the unauthorized conduct of an agency directorwill set forth in a previously-acquired agency in Monroe, Louisiana. We disclosed these improprieties toprospectus supplement or, if appropriate, a post-effective amendment, the OIG. Following an extensive series of audits, we and the OIG reached a settlement in August 2003. As part of this settlement, we agreed to repay approximately $1.2 million to the government in three annual payments, the last of which we will make in 2005. We also executed a three-year CIA which requires that we:

	•	maintain our current compliance program;
	•	specify additional training requirements;
	•	conduct annual, independent audits of the agency; and
	•	make timely disclosure of and repay overpayments resulting from any potential fraud or abuse of which we become aware.

     There are stipulated penalties for violationsterms of the CIA. Egregious violations ofoffering, including among other things, the CIA could result in our exclusion from further participation in government-funded health programs. We have designated a Chief Compliance Officer to ensure ongoing compliance with the terms and conditions of the CIA as well as compliance with all other applicable laws, rules, and regulations. Any acquired businesses will be subject to the provisions of the CIA.

     We believe that we are in compliance with all state and federal fraud and abuse provisions and all other applicable government laws and regulations. Our compliance with these laws and regulations may be subject to future government review and interpretation and possible regulatory actions currently unknown or unasserted. If we are found to be in violation of any of these provisions, it could have a material adverse effect on our business.

     We operate our agencies under licenses issued and regulated by the respective states in which they are located. Each agency is subject to periodic surveys and complaint-based surveys. If a survey identifies violations of state standards, the agency typically is afforded a grace period in which to comply or otherwise lose its license to operate. We use a Clinical Operations Department, staffed by regional personnel, to prepare each agency for these surveys and respond when those surveys identify potential problems or when plans-of-correction are required to bring the agency back into compliance. If we are found to be in violation of any of these state standards, it could have a material adverse effect on our business.

NPF VI

     In November 2002, we elected to terminate our asset financing facility with NPF VI, Inc. (“NPF VI”) and advised our payors that payments should be directed to our bank accounts rather than bank accounts controlled by NPF VI under collateral arrangements for the facility. NPF VI has filed for Chapter 11 bankruptcy protection. We are taking legal and other action to recover Company funds from JP Morgan, as trustee for NPF VI, that have not been released to us. During the fourth quarter of 2002, we recorded a reserve for the full amount of approximately $7.1 million related to our funds held by JP Morgan. During the quarter ended June 30, 2004, we received an unfavorable verdict in our suit against JP Morgan. We are appealing this decision to the U.S. Circuit Court of Appeals. No assessment of the likelihood of an outcome favorable to us can be made at this time.

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Competition

     We compete with local, regional, and national home nursing providers for referrals based primarily on scope and quality of services, geographic coverage, outcomes data, and, in selected instances, pricing. The impact of this competition is best determined on a market-by-market basis. We believe our generally favorable competitive position is attributable to our reputation for consistent, high-quality care, comprehensive range of services, state-of-the-art information management systems, and widespread service network.

Employees

     At June 30, 2004, we had 3,260 employees, of which 2,016 were full-time employees. None of our employees are represented by a collective bargaining agreement. We believe that we have a good relationship with our employees.

Properties

     Our corporate headquarters are located in Baton Rouge, Louisiana in a total of 36,869 square feet of leased office space, under four separate lease agreements, each of which expires December 31, 2006. Typically, our home health agencies are located in leased facilities. Generally, the leases have initial terms of three years, but range from one to six years. Most of the leases contain options to extend the lease period for up to five additional years.

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PRINCIPAL AND SELLING STOCKHOLDERS

     The following table sets forth information about the beneficial ownership of our common stock on August 27, 2004, and as adjusted, which assumes the sale of a total of 150,000 shares of common stock by certain selling stockholders and 150,000 shares of common stock by us in this offering pursuant to the exercise of the underwriters’ over-allotment option. The underwriters will draw upon such shares from us and the selling stockholders on a pro rata basis.

     We have determined beneficial ownership in accordance with the rules of the SEC. Except as indicated by the footnotes below, we believe, based on the information furnished to us, that the persons and entities named in the table below have sole voting and investment power with respect to all shares of common stock that they beneficially own, subject to applicable community property laws. We have based our calculation of the percentage of beneficial ownership on 12,387,940 shares of common stock outstanding on August 27, 2004, and 14,687,940, assuming the underwriters exercise their over-allotment option in full shares of common stock outstanding upon completion of this offering.

     In computing the number of shares of common stock beneficially owned by a person and the percentage ownership of that person, we deemed to be outstanding any shares of common stock subject to options held by that person that currently are exercisable or exercisable within 60 days after August 27, 2004. We did not deem these shares outstanding, however, for the purpose of computing the percentage ownership of any other person.

Unless otherwise noted below, the address of each beneficial owner listed in the table below is c/o Amedisys, Inc., 11100 Mead Road, Suite 300, Baton Rouge, Louisiana 70816.

(*)	Less than one percent.
(1)	The amounts in this column include shares of common stock with respect to which certain persons had the right to acquire beneficial ownership within 60 days after August 18, 2004, pursuant to the exercise of options: William F. Borne: 208,400 shares; Larry R. Graham: 36,306 shares; Gregory H. Browne: 34,666 shares; Jeffrey Jeter: 5,333 shares; John H. Linden: 667 shares; Peter F. Ricchiuti:

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	44,455 shares; Jake L. Netterville: 53,805 shares; Ronald A. LaBorde: 53,805 shares; David R. Pitts: 53,805 shares; and executive officers and directors as a group: 491,242 shares.
(2)	The address for Terra Listed, Ltd., is 2/3 Rue du Pre, St. Peter Port, Guernsey, Channel Islands GY1 3NS.
(3)	Includes 20,000 shares of common stock owned by his wife, 25,000 shares of common stock owned by a trust on behalf of Mr. Borne’s children, and 25,100 shares of common stock owned by his father.
(4)	Includes 4,156 shares owned jointly with his wife, and 7,698 shares of common stock owned by his wife.

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UNDERWRITING

Subject to the terms and conditions of the underwriting agreement dated                     , 2004, the underwriters named below, for whom Raymond James & Associates, Inc. is acting as representative, have severally agreed to purchase from us the respective number of shares of our common stock set forth opposite their names below:

     The underwriting agreement provides that the obligations of the several underwriters to purchase and accept delivery of the common stock offered by this prospectus are subject to the terms and conditions set forth in the underwriting agreement. The underwriters are obligated to purchase and accept delivery of all of the shares of common stock offered by this prospectus, if any are purchased, other than those covered by the over-allotment option described below.

     The underwriters propose to offer the common stock directly to the public atbe sold, the public offering price, indicated on the cover pagenames of this prospectusany underwriters, dealers or agents and to various dealers at that price less a concession not to exceed $           per share, of which $          may be re-allowed to other dealers. After this offering, the public offering price, concession and re-allowance to dealers may be reduced by the underwriters. No reduction will change the amount of proceeds to be received by us as indicated on the cover page of this prospectus. The shares of common stock are offered by the underwriters as stated in this prospectus, subject to receipt and acceptance by them and subject to their right to reject any order in wholeapplicable commissions or in part.discounts.

     We have granted to the underwriters an option, exercisable within 30 days after the date of this prospectus, to purchase from time to time up to an aggregate of 150,000 additional shares of common stock to cover over-allotments, if any, at the public offering price less the underwriting discount; and the selling stockholders have granted to the underwriters an option, exercisable within 30 days after the date of this prospectus, to purchase from time to time up to an aggregate of 150,000 additional shares of common stock to cover over-allotments, if any, at the public offering price less the underwriting discount. If the underwriters exercise their over-allotment option to purchase any of these additional 300,000 shares of common stock, each underwriter, subject to several conditions, will become obligated to purchase its pro rata portion of these additional shares based on the underwriter’s percentage purchase commitment in this offering as indicated in the table above. If purchased, these additional shares will be sold by the underwriters on the same terms as those on which the shares offered by this prospectus are being sold. The underwriters may exercise the over-allotment option only to cover over-allotments made in connection with the sale of the shares of common stock offered in this offering.

The following table summarizes the underwriting compensation to be paid to the underwriters by us. These amounts assume both no exercise and full exercise of the underwriters’ over-allotment option to purchase additional shares. We estimate that the total expenses payable by us in connection with this offering, other than the underwriting discount referred to below, will be approximately $300,000.

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     We andIn order to comply with the selling stockholders have agreed to indemnifysecurities laws of particular states, if applicable, the underwriters against various liabilities, including liabilities under the Securities Act of 1933, or to contribute to payments the underwriters may be required to make because of any of those liabilities.

     Subject to specified exceptions, each of our directors and our executive officers has agreed, for a period of 90 days after the date of this prospectus, without the prior written consent of Raymond James & Associates, Inc., not to offer, sell, contract to sell, pledge, grant any option to purchase or otherwise dispose of any shares of our common stock offered under this prospectus will be sold in the jurisdictions only through registered or securities convertible intolicensed brokers or exercisable or exchangeable for anydealers. In addition, in particular states, the shares of our common stock. This agreement also precludes any hedging, collarstock may not be sold unless they have been registered or other transaction designedqualified for sale in the applicable state or reasonably expected to result in a dispositionan exemption from the registration or qualification requirements is available and is complied with.

     To our knowledge, none of our common stock or securities convertiblethe selling shareholders has entered into, or exercisablewill enter into before the effective date of the shelf registration statement of which this prospectus is a part, any agreement, arrangement or exchangeable for our common stock.

     In addition, we have agreedunderstanding with any broker or dealer relating to the sale of any of the shares covered by this prospectus. We will inform the selling shareholders that for 90 days after the datethey are legally required in accordance with applicable prospectus delivery requirements to deliver copies of this prospectus we will not, directly or indirectly, without the prior written consent of Raymond James & Associates, Inc., issue, sell, contract to sell, or otherwise dispose of or transfer,in connection with any of our common stock or securities convertible into, exercisable for or exchangeable for our common stock, or enter into any swap or other agreement that transfers, in whole or in part, the economic consequences of ownership of our common stock or securities convertible into, exercisable for or exchangeable for our common stock, except for our sale of common stock in this offering,the offered shares.

     Each selling shareholder will be subject to applicable provisions of the Securities Exchange Act of 1934 and the issuancerules and regulations thereunder, which provisions may limit the timing of options orpurchases and sales of shares of common stock under our currently outstanding warrants, and our existing stock option plans.by the selling shareholders.

     UntilUnder applicable rules and regulations under the offering is completed,Exchange Act, any person engaged in the rulesdistribution of the SECshares may not simultaneously engage in market making activities with respect to our common stock for a period of two business days prior to the commencement of such distribution. In addition, each selling shareholder will be subject to applicable provisions of the Exchange Act and the associated rules and regulations under the Exchange Act, including Regulation M, which provisions may limit the abilitytiming of the underwriterspurchases and selling group members to bid for and purchase shares of our common stock. As an exception to these rules, the underwriters may engage in some types of transactions that stabilize the price of our common stock. These transactions may include short sales stabilizing transactions, purchases to cover positions created by short sales and passive market making. Short sales involve the sale by the underwriters of a greater number of shares of our common stock than they are requiredby the selling shareholders.

     Each selling shareholder will pay all fees, discounts and brokerage commissions allocable to purchasehis, her or its shares, as well as the fees and expenses of his, her or its counsel. We will pay all expenses of this registration, including without limitation, the costs and expenses of preparing and reproducing this prospectus and complying with state securities laws, as well as filing fees with the SEC.

The shares offered by the selling shareholders in this prospectus bear legends as to their restricted transferability. Upon the offering. Stabilizing transactions consisteffectiveness of bids or purchases made for the purposeregistration statement of preventing or retardingwhich this prospectus is a decline inpart and the market pricetransfer by the selling shareholders of our common stock whileany of the offering is in progress. In passive market making, the underwriter, in its capacity as market maker in the common stock, may, subject to limitations, make bids for or purchases of our common stock until the time, if any, at which a stabilizing bid is made.

     The underwriters also may impose a penalty bid. This occurs when a particular underwriter repaysshares pursuant to the other underwriters a portion ofregistration statement, new certificates representing these shares will be issued to the underwriting discount received by it because the representatives have repurchased shares sold by or for the accounttransferee, free of such underwriter in stabilizing or short covering transactions.

     These activitieslegends unless otherwise required by the underwriters may stabilize, maintain or otherwise affect the market price of our common stock. As a result, the price of our common stocklaw. The new certificates will also bear other applicable legends as may be higher thanrequired by law, to reflect applicable prospectus delivery requirements or to assist us in requiring compliance with the price that otherwise might exist in the open market. If these activities are commenced, they may be discontinued by the underwriters without notice at any time. These transactions may be effected on the Nasdaq National Market or otherwise.

Some of the underwriters or their affiliates, including Raymond James & Associates, Inc. and Jefferies & Company, Inc., have in the past and may in the future perform investment banking and other financial services for us and our affiliates for which they may receive advisory or transaction fees, as applicable, plus out-of-pocket expenses, of the nature and in amounts customary in the industry for these financial services.Securities Act.

LEGAL MATTERS

     The validity of the issuance of the shares of common stock offered hereby will be passed upon for us by Correro Fishman Haygood Phelps Walmsley & Casteix, L.L.P., New Orleans, Louisiana. Morrison & Foerster LLP, New York, New York,Louisiana, has given us an opinion that the shares have been duly authorized, and that they are, or in the case of shares issuable upon the exercise of the warrant will pass upon legal matters relating to the offering for the underwriters.

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be, validly issued, fully paid and non-assessable.

EXPERTS

     The consolidated financial statements of Amedisys, Inc. as of December 31, 2002 and 2003 and for each of the years in the two-year period ended December 31, 2003, have been incorporated by reference herein and in the registration statement in reliance upon the report of KPMG LLP, independent accountants,registered public accounting firm, incorporated by reference herein, and upon the authority of said firm as experts in accounting and auditing.

     KPMG’s report refers to its audit of transitional disclosures for 2001 required by Statement of Financial Accounting Standards No. 142 “Goodwill and Other Intangible Assets”, which was adopted by Amedisys, Inc. on January 1, 2002 to revise the 2001 consolidated financial statements, as more fully described in Note 1 to the consolidated financial statements. However, KPMG was not engaged to audit,

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     The combined Statement of Direct Revenues and Direct Operating Expenses of the Acquired Entities for the year ended December 31, 2003, have been incorporated by reference herein and in the registration statement in reliance upon the report of KPMG LLP, independent accountants,registered public accounting firm, incorporated by reference herein, and upon the authority of said firm as experts in accounting and auditing.

The combined financial statements of Standard Home Health Care, Inc. and Cypress Health Services, LLC (collectively, Metro Preferred Home Care) as of and for the years ended December 31, 2002 and 2001, have been incorporated by reference herein and in the registration statement in reliance upon the report of KPMG LLP, independent registered public accounting firm, incorporated by reference herein, and upon the authority of said firm as experts in accounting and auditing.

NOTICE REGARDING ARTHUR ANDERSEN LLP

     Arthur Andersen LLP audited our financial statements for the five years ended December 31, 2001. We have included information derived from these financial statements in this prospectus through incorporation by reference of certain documents filed by us with the SEC. On June 15, 2002, Arthur Andersen was convicted of obstruction of justice by a federal jury in Houston, Texas in connection with Arthur Andersen’s work for Enron Corp. On September 15, 2002, a federal judge upheld this conviction. Arthur Andersen ceased its audit practice before the SEC on August 31, 2002. Effective April 30, 2002, we terminated the engagement of Arthur Andersen as our independent auditors and engaged KPMG LLP to serve as our independent auditors. KPMG LLP has audited our financial statements for the years ended December 31, 20022003 and 2003.2002. Because of the circumstances currently affecting Arthur Andersen LLP, as a practical matter it may not be able to satisfy any claims arising from the provision of auditing services to us, including claims holders of notessecurities may have that are available to security holders under applicable securities laws.

WHERE YOU CAN FIND MORE INFORMATION

     We file annual, quarterly and special reports, proxy statements and other information with the SEC. You may read and copy any document we file at the SEC’s public reference room located at 450 Fifth Street, N.W., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information about the public reference room. Our SEC filings are also available to the public from commercial document retrieval services and at the web site maintained by the SEC at: http://www.sec.gov. Reports, proxy statements and other information pertaining to us may also be inspected at the offices of The Nasdaq Stock Market, which is located at 1735 K Street, N.W., Washington, D.C. 20006.

This prospectus is part of a registration statement on Form S-3 that we have filed with the SEC.SEC to register the sales of the securities offered by this prospectus. The registration statement contains additional information about us and our securities. You may inspect the registration statement and exhibits at the SEC public reference room or at the SEC’s website. As allowed by the SEC rules, this prospectus does not contain all of the information you can find in our registration statement or the exhibits to the registration statement.

     You should rely only on the information contained herein or incorporated by reference.representations provided in this prospectus or any supplement to this prospectus. We have not authorized anyone else to provide you with different information. The selling shareholders are not making an offer of our securities in any state where the offer is not permitted. The delivery of this prospectus does not, under any circumstances, mean that there has not been a change in our affairs since the date of this prospectus. It also does not mean that the information in this prospectus is correct after this date.

     Our address on the world wide web is http://www.amedisys.com. The information on our web site is not a part of this document.

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INCORPORATION BY REFERENCE

     The SEC allows us to “incorporate by reference” certainthe information that we file with it, which means that we can disclose important information to you by referring you to those documents.documents that we have filed with the SEC. The information incorporated by reference is considered to be part of this prospectus, and information that we file later with the SEC will automatically update automatically, supplement and/orand supersede this information. Any statement in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of this prospectus to the extent that a statement contained herein or in any other document which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part hereof. You should read the following summary together with the more detailed information regarding our Company, our common stock and our financial statements and notes to those statements appearing elsewhere in this prospectus or incorporated herein by reference.

     We have not authorized anyone else to provide you with different information. We are not making an offer of these securities in any state where the offer is not permitted. You should not assume that the information herein is accurate as of any date other than the date on the front page of this prospectus, regardless of the time of delivery of this prospectus or any sale of common stock.

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     We file annual, quarterly and special reports, proxy statements and other information with the SEC. You may read, without charge, and copy the documents we file at the SEC’s public reference rooms in Washington, D.C., New York, New York and Chicago, Illinois, under SEC File No. 000-24260. You can request copies of these documents by writing to the SEC and paying a fee for the copying cost. Please call the SEC at 1-800-SEC-0330 for further information on the public reference rooms. Our SEC filings are also available to the public at no cost from the SEC’s website at http://www.sec.gov.

     We incorporate by reference the filed documents listed below except as superseded, supplemented or modified by this prospectus, and any future filings we will make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 (the “Exchange Act”):until the completion of the offering of the securities described in this prospectus:

	•	our Annual Report on Form 10-K, filed on March 29, 2004, for the fiscal year ended December 31, 2003;
	•	our Quarterly Report on Form 10-Q, filed on May 13, 2004, for the fiscal quarter ended March 31, 2004;
	•	our Quarterly Report on Form 10-Q, filed on August 9, 2004, for the fiscal quarter ended June 30, 2004;
	•	our Current ReportReports on Form 8-K, filed March 16, 2004, April 28, 2004 (reporting information under Item 5), August 11, 2004, August 23, 2004, September 9, 2004, September 17, 2004, October 1, 2004 and October 8, 2004;
	•	our Amended Current Reports on Form 8-K/ A filed February 10, 2004 and July 15, 2004;
	•	our Current Reportdefinitive Proxy Statement for our 2004 Annual Meeting of Stockholders filed on Form 8-K, filed July 22, 2004;
	•	our Current Report on Form 8-K, filed August 3, 2004;
	•	our Current Report on Form 8-K, filed August 9, 2004;
	•	our Current Report on Form 8-K, filed August 11, 2004;
	•	our Current Report on Form 8-K, filed August 23,April 29, 2004; and
	•	The description of our definitive proxy statementcommon stock set forth in our Current Report on Form 8-K filed April 29, 2004.on December 11, 2000.

     The reports and otherIn addition to the filings listed above, we incorporate by reference additional documents that we may file with the SEC between the date of this document and the date of the completion of the offering of the securities described in this prospectus. These documents include periodic reports, such as Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, as well as proxy statements. We incorporate by reference also all such documents filed by us after the date hereof will update, supplementof the initial filing of the registration statement of which this prospectus is a part and supersedeprior to its effectiveness.

     You can obtain any of the informationdocuments incorporated by reference in this prospectus.document from us, or from the SEC through the SEC’s Internet world wide web site at http://www.sec.gov. Documents incorporated by reference are available from us without charge, excluding any exhibits to those documents, unless the exhibit is specifically incorporated by reference as an exhibit in this document. You maycan obtain documents incorporated by reference in this document upon written or oral request and obtain a copy of these filings, at no cost, by writing or telephoningto us at the following address or phone number:address:

	Amedisys, Inc.
	11100 Mead Road, Suite 300
	Baton Rouge, Louisiana 70816
	(800) 467-2662
	Attn: Gregory H.Amedisys, Inc.             11100 Mead Road Suite 300             Baton Rouge, Louisiana 70816             (225) 292-2031             Attn: Greg Browne

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You should rely only on the information contained in this prospectus.     We have not authorized anyone to provide you withgive any information or make any representation about the offering or us that is different from, or in addition to, that contained in this prospectus or any prospectus supplement. This prospectus isdocument. Therefore, if anyone does give you information of that sort, you should not an offer of these securities in any jurisdiction where an offer and sale is not permitted.rely on it. The information contained in this prospectus is accuratedocument speaks only as of the date of this prospectus, regardless ofdocument unless the time of deliveryinformation specifically indicates that another date applies.

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     Any statement contained in a document incorporated or deemed incorporated herein by reference shall be deemed to be modified or superseded for the purpose of this prospectus to the extent that a statement contained herein or in any salesubsequently filed document which also is, or is deemed to be, incorporated herein by reference modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as to modified or superseded, to constitute a part of our common stock.this prospectus.

2,000,000 Shares

Amedisys, Inc.

Common Stock

RAYMOND JAMES

JEFFERIES &

LEGG MASON WOOD WALKER

                    , 2004