Auxilio Adds Another Catholic Hospital – Analyst Blog
On June 11, 2012, Auxilio, Inc., the Mission Viejo, California based Managed Print Services (MPS) company for the health care industry, reported it signed an approximately $35 million MPS contract with Bon Secours Health System (BSHSI).
Auxilio will implement its MPS program in 14 hospitals and multiple affiliated care and support locations in six states.
The five year contract is expected to save BSHSI approximately $7 million over the course of the contract.
Headquartered in Marriottsville, MD, BSHSI is a $3.3 billion not-for-profit Catholic health system, sponsored by Bon Secours Ministries, that owns, manages, or joint ventures a total of 19 acute-care hospitals, one psychiatric hospital, five nursing care facilities, four assisted living facilities, and 14 home care and hospice services.
With its national portfolio of 80 long-term contracts representing hospitals, health care systems and affiliated clinical and administrative support offices, Auxilio provides intelligent solutions, a risk free program and guaranteed savings.
What’s more, the Company’s recurring revenue base reflects a 100 percent customer retention rate.
Moreover, in an effort to scale its business to meet the evolving U.S. healthcare industry acceleration, Auxilio has recently made several key operational enhancements including scaling sales and business development efforts.
The Company remains focused on building awareness in the healthcare industry to add new accounts with large healthcare systems, expanding its geographic presence domestically, renewing existing accounts for three to five year terms, and moving all new accounts toward profitability.
Furthermore, as a result of an expanded marketing alliance with Sodexo, a leading provider of comprehensive service solutions, as well as the increase in the Auxilio’s staffing headcount, the Company expects to close additional recurring revenue contracts to new customers throughout 2012.
In April 2012, Auxilio signed a five year contract with Wentworth-Douglass Hospital, one of the largest acute care and multi-specialty hospitals in the Seacoast region of New Hampshire and Southern Maine, to cut costs and improve efficiencies through its Managed Print Services.
Likewise, it should be noted that with the BSHSI contract, Auxilio now has procured ten new or expanded contracts that began since the fourth quarter of 2010.
In addition, the Healthcare Information Technology (HITECH) portion of the American Recovery and Reinvestment Act of 2009 (ARRA) offers Auxilio a unique growth opportunity.
The HITECH portion of the bill includes nearly $20 billion of reimbursement incentives to those providers achieving “Meaningful Use” for the implementation of an Electronic Medical Record System.
The funding begins in 2012 for those who achieved “Meaningful Use” in 2011 and Medicare will begin applying penalties to hospital and physicians who fail to adopt Electronic Medical Record Systems starting in 2015.
Auxilio’s unshared position as the only managed print service provider in the U.S. dedicated exclusively to the health care industry and hospitals allows it to tap into HITECH incentives indirectly by bringing a unique exposure and knowledge in assisting customers in the preparation of electronic records management and the complex compliance requirements of the ‘meaningful use’ criteria federal mandates.
As Hospitals and IT departments are pressured to further reduce cost and enhance efficiencies as well as act quickly on cost cutting measures to comply with these EHR (Electronic Health Records) mandates, it leads to shorter sales cycles for Auxilio.
Similarly, the continued trend of high levels of consolidation within the healthcare industry should work to the Company’s advantage.
As healthcare systems consolidate and become larger, the need to streamline cost and increase efficiencies also grows, presenting a strong demand driver for Auxilio’s MPS solutions.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.