LAKE FOREST, Calif.--(BUSINESS WIRE)--Jan. 22, 2004--

New Third Party Billing Program for Ambulatory Surgery Centers and Possibility of a CPT Code with Modifier May Enable Easier Payment for Facilities and Physicians

I-Flow Corporation, (NASDAQ: IFLO) today announced the initiation of its ON-Q(R) Third Party Billing Program to be used in outpatient settings. This program will enable Ambulatory Surgery Centers (ASCs) to provide patients this emerging standard in post-surgical pain relief while getting reimbursement for I-Flow for the cost of ON-Q. Piloted in 2003 with more than 1,500 test cases, this program is designed to make ON-Q easy to adopt and minimizes paperwork for ASCs. More than half of U.S. surgeries are performed in an outpatient setting. Additionally, I-Flow is currently conducting case studies with a CPT code with modifier for payment to physicians who place the ON-Q PainBuster(R) catheter during surgery.

"With the interest in ON-Q increasing rapidly, it is our goal to make the use of and payment for the device seamless for ambulatory surgery centers as well as individual surgeons," said Donald M. Earhart, president and CEO of I-Flow Corporation. "I-Flow is committed to working with insurance companies to maximize reimbursement for our customers while offering the opportunity for outstanding patient care. We hope that this will help make ON-Q increasingly available to patients who would like to reduce their narcotics intake and risks and get back to their normal lives faster following surgery."

Centers enrolling in the ON-Q Billing Program will submit claims that will be processed through a division of I-Flow that has built relationships and secured contracts with insurance companies over the past 18 years. Through the billing program, a patient's insurance company will be billed directly. This way, ASCs can reduce the hassles related to billing and collecting for ON-Q.

Additionally, there is a methodology that has recently been shown to enable successful reimbursement to physicians for the placement of the ON-Q catheter following surgery. I-Flow has set up a hotline to answer physicians' questions when they bill for the procedure. I-Flow has compiled this billing data in a case study and will present the relevant information to interested physicians.

About ON-Q

The ON-Q(R) Post-Operative Pain Relief System provides targeted pain relief after surgery only where the body needs it, delivering a non-narcotic numbing medication directly to an incision site. ON-Q consists of a small, high-tech balloon pump that delivers local anesthetic, a pain-numbing medication, directly to the surgical site for up to five days. The anesthetic is administered through a tiny specially-designed tube (catheter) that's inserted by a surgeon during surgery. ON-Q is cleared for use by the U.S. Food & Drug Administration (FDA).

ON-Q can deliver narcotic-free pain relief for many surgeries, including: cesarean sections, hysterectomies, knee replacements, mastectomies, cardio-vascular/thoracic surgeries, foot and ankle surgeries and many cosmetic surgeries. A growing body of clinical information is becoming available for ON-Q for many different surgeries. For more information about ON-Q, visit www.AskYourSurgeon.com or call 800-448-3569.

About I-Flow Corporation

I-Flow Corporation (www.iflo.com) designs, develops and markets technically advanced drug delivery systems that are redefining the standard of care by providing life enhancing, cost effective solutions for pain relief.

Certain disclosures made by the Company in this press release and in other reports and statements released by the Company are and will be forward-looking in nature, such as comments that express the Company's opinions about trends and factors that may impact future operating results. Disclosures that use words such as the Company "believes," "anticipates," or "expects" or use similar expressions are intended to identify forward-looking statements. Forward-looking statements are subject to certain risks and uncertainties, which could cause actual results to differ from those expected, and readers are cautioned not to place undue reliance on these forward-looking statements. The Company undertakes no obligation to republish revised forward-looking statements to reflect the occurrence of unanticipated events. Readers are also urged to carefully review and consider the various disclosures made by the Company in this release which seek to advise interested parties of the risks and other factors that affect the Company's business, as well as in the Company's periodic reports on Forms 10-K, 10-Q, and 8-K filed with the Securities and Exchange Commission. The risks affecting the Company's business include reliance on the success of the home health care industry, the Company's success in pursuing its direct sales strategy, the reimbursement system currently in place and future changes to that system, competition in the industry, economic and political conditions in foreign countries, currency exchange rates, inadequacy of booked reserves, technological changes and product availability. Any such forward-looking statements, whether made in this release or elsewhere, should be considered in context with the various disclosures made by the Company about its business.

    CONTACT: Schwartz Communications
             Wendy Williams/Brian Bogie, 781-684-0770
             i-flow@schwartz-pr.com
             or
             I-Flow Corporation
             Orlando Rodrigues, 949-206-2619
             orlando.rodrigues@i-flowcorp.com

    SOURCE: I-Flow Corporation