PLDT acquires medical outsourcing firm

The Philippine Long Distance Telephone Co. has expanded its business process outsourcing business with the acquisition of Laguna Medical Systems Inc. (LMS) for $8.25 million (about P400 million).

In a disclosure to the Philippine Stock Exchange on Wednesday, PLDT said the acquisition was made by SPi Global Solutions, a leading BPO company which is a unit of its wholly owned information and communications technology company ePLDT Inc.

LMS has over 50 consultants across the region who assist more than 200 hospitals attain coding and billing compliance as well as optimize entitled reimbursements for patient services.

This 22-year-old company also offers recovery audit contractor (RAC) defense and recovery services to help healthcare providers manage and defend RAC audits.

"As a result of the significant focus on healthcare reform in the US, we have been actively tracking companies in the coding compliance space with the goal of finding one to acquire whose corporate culture and values match our own," SPi president Peter Maquera said.

"LMS fits the bill. Their capabilities nicely complement our existing medical transcription, billing and revenue cycle management services and provide an excellent new entry point for us into this rapidly growing $25 billion industry," he added.

The inclusion of LMS' product offering, he noted, would strengthen SPi's relationship with more than 400 hospitals, multi-specialty clinics and physician practices.

"And it increases our healthcare-specific employee base to more than 2,000 worldwide," he said.

The US healthcare industry accounts for 16 percent of US gross domestic product and is the largest segment in the US economy.

With the US government now requiring healthcare workers to achieve a 95 percent or greater accuracy rate on medical coding, inexperienced healthcare providers with limited resources are seen struggling to meet this requirement.

This in turn is seen to provide growth opportunities for well-funded and -managed service providers in the coding compliance consulting market.

"SPi's acquisition of LMS is an excellent example of how we are executing on our strategic plan to accelerate growth and strengthen our position in the BPO arena," said ePLDT president Ray Espinosa.