Here is some interesting information that was released from Hearx on the Yahoo message board yesterday:
COMMONLY ASKED QUESTIONS
a) Stage of Development-I believe a company goes through four distinct phases as follows:
1) Market Penetration, 2) Systems Development, 3) Profit Making,
4) Expansion.
HEARx has now completed phase 1 with name recognition in both the healthcare provider system and with patients in our geographic area. We have two final projects to complete in phase 2 (target date July 1st). These include computerized insurance billing and computerized appointment making. As we draw to an end of this phase, attention is now being placed on successfully accomplishing phase 3 by reviewing how we do business to maximize revenue and reduce expenses.
Our target of $40 million for fiscal 1998, if achieved, would certainly make the company cash flow positive and depending upon the region with the sales growth.profitable.
b) Facilities-There are no plans to add significant centers during fiscal year 1998. The only additional locations that will be developed will be in conjunction with a contract assuring breakeven in the same year of opening.this means that the emphasis moving forward will be maximizing market penetration, which obviously will lead to profitability.
c) Marketing Strategy-Because of the difficulties that a number of managed care companies have had during the past year, HEARx elected to increase its efforts to attract the "self-pay" patient with newspaper, television, billboard, direct mailing and telemarketing. We saw our "self-pay" business increase more than 28% in the second half of 1997.an increase which is continuing in 1998.
d) Managed Care Growth-The number of Medicare managed care members under per capita contract increased in 1997 from 291,000 to more than 450,000. Approximately 8% of all the Medicare members who have changed to managed care are now under a HEARx contract. This growth was achieved as a result of new contracts rather than growth in membership from pre-existing contracts. It is our belief that after the various health providers solve their internal problems that their attention will once again be turned toward attracting new members.
e) Cash-At the present time the company has approximately $12 million and still has no significant debt. In other words, HEARx has more than enough money to "stay the course".
f) Regional Situation-The company is, in fact, operating three different businesses as follows: Southeast Florida, Southwest Florida and the Northeast.
i) In the Southeast, where we have been operating for more than ten years, we have every contract except one, approximately a 30% share of the market and centers which contribute significantly toward Corporate overhead.
ii) The Southwest region, where we have every contract and a 10% share of the market, we believe the centers, as a group, will breakeven this year and begin contributing to Corporate overhead in 1999.
iii) The Northeastern network will require additional contracts such as those signed in December, selected acquisitions or an increase in the "self-pay" business in order to reduce the losses from the centers which where built for both Oxford and Prudential. As always contract negotiations are taking place with several providers, which could dramatically increase the level of business in the centers located in the Northeast. |
