Recent Acquisition Gives ARM Firm New Healthcare Services Expertise

The year 2008 was bad for hospitals - non-profit hospitals in particular.  Profits were down for most hospital operators, layoffs increased due to weak admissions rates, and an American Hospital Association survey this year found that nine in 10 hospitals are making cutbacks to help weather the economic storm.

Consequently, many will be looking to outsource non-core businesses such as billing and collections and FirstPoint Collection Resources, Inc. is hoping that its recent acquisition of Mosaic Revenue Solutions will better position it to be on hospitals’ call list for services.  

A recent proposal by leaders of the Senate Finance Committee to change when, and perhaps what, not-for-profit hospitals outsource to collections agencies may limit the acquisition’s potential, however.

FirstPoint, based in Greensboro, N.C., is already one of the largest accounts receivables management companies in the Southeast serving the healthcare, retail, utility, commercial and government sectors. Business has been so good, FirstPoint bought Mosaic with its own cash and the company remains without debt, said Gil Gimbel, FirstPoint’s senior vice president and chief operating officer.

The management team headed by CEO Mike Bumpass wanted to grow the business in an area it wasn’t as strong to make it more attractive to health care providers looking for one-stop revenue cycle solutions.  Mosaic’s niche in the extended business office operations for health care providers fit the bill.

“To just buy revenue in times like this is problematic,” Gimbel said. “You’re not growing your horizon as a business. You’re just buying more of the same.  That revenue (stream) could dry up. It doesn’t make your roots wider.”

FirstPoint bought Mosaic from High Point Regional Health Systems, which operated Mosaic as a standalone company out of High Point, N.C. The company did early out billing work for its parent company and other hospitals and health care entities.