AdvancedMD, located in Salt Lake City, Utah, is a medical billing software provider. The company, formerly known as Perfect Practice, was launched in 2002. Its SaaS-based medical office management platform aims to offer a complete solution for billing, scheduling and practice management.
AdvancedMD’s solutions integrate multiple processes such as scheduling, medical records and billing into a single source and are entirely Web based. The solutions offer medical billing, claims management, scheduling software and an electronic medical records management system. AdvancedMD is targeting small practices that include physicians’ offices, management services organizations and medical billing services. However, AdvancedMD only supports the “two most current” desktop versions of Microsoft Windows, Internet Explorer and Office (Word and Excel). Further, the platform requires a minimum of 512 Kb/s download speed for 1-5 concurrent users.
AdvancedMD does not require long-term contracts and charges its clients on a month-to-month subscription fee per provider/doctor. Additionally, a one-time setup fee to establish the EDI relationships and contracts with the payers and clearing house (e.g. Medicare) is required. This usually comes to $2,000-$4,000 for the first provider and $150 each for additional providers. While this fee includes ongoing Web-based software upgrades, additional features are available “à la carte”.
Though the penetration of SaaS-based practice management or medical records systems into small practices has been quite low so far, the company is witnessing a growth in lead generation. The company claims that it is currently pushing 1,000 leads a month, which are all inbound contacts from prospective customers, as opposed to 40 new leads in a “good” month, about three years ago. As of July 2008, AdvancedMD provides services to more than 8,500 providers including Highland Campus Health Group, Medigain, Greene Memorial Hospital and Priority Medical Billing. The company’s year-over-year growth has been in the double digits, averaging over 70% annually. According to Inc.com, the company generated $15.3 million in revenue in 2007.
AdvancedMD had originally been funded by venture capital. In January 2008, private equity firm Francisco Partners acquired the company and owns a 100% stake. The company had been self sustaining for the past few years and continues to be self sustaining after the acquisition. AdvancedMD now plans to increase efficiency, refine business practices, expand and focus sales and marketing efforts on a lead generation and conversion plan to generate the funds required to grow the business instead of looking to Francisco Partners for capital.
The company also made changes to its management team after the acquisition. In July 2008, Eric Morgan, who has been in the IT and technology business for over 25 years, was named the new president and CEO. He replaced John Trzeciak, who served as interim CEO after the acquisition. Prior to joining AdvancedMD, Morgan was president and CEO of StatCom LLC where he successfully led the company into the enterprise patient flow space, established key client successes and helped position the company for growth. Prior to StatCom, Morgan was with Lawson Software for 13 years and served in several leadership positions including executive vice president and general manager of Lawson’s Healthcare business unit. In December 2008, the company named tech veteran Christopher J. Bijou as executive vice president of sales. In his 18-year career in the enterprise software and SaaS industries, Bijou has served as senior vice president of sales at UCN, Inc and senior director of sales for the Oracle CRM product line in the US and Canada, among others. He is responsible for inside, field-based and channel sales operations.
Morgan plans to bring additional leadership to the management team in the areas of sales and customer service. According to Morgan, “The team is coming together and in early 2009 all management pieces will be in place, and any changes will be finalized by then.”
This segment is a part in the series : Deal Radar 2009