BRENTWOOD, Tenn.--American HomePatient reported a slight decline in 2004 revenue and net income last month, attributing the drop to a cut in Medicare reimbursement for inhalation drugs. The drugs make up about 12 percent of the company's revenue.

For 2004, the company reported $13.2 million in net income compared to $14 million for 2003, and $335.8 million in revenue, slightly less than prior-year results of $336.2 million.

During the fourth quarter, however, the company reported strong increases in net income--$8.2 million, compared with $4.7 million for fourth-quarter 2003. The company attributed the increase to reduced operating expenses, including increased efficiency and reduced personnel costs.

American HomePatient, which operates 276 branches in 35 states, emerged from bankruptcy protection in July 2003.