PLANTATION, Fla. - Performant Financial Corporation (NASDAQ:PFMT), a company specializing in payment integrity and analytics services, announced its tentative selection for the New York State Medicaid Recovery Audit Contractor (RAC) award by the NYS Office of the Medicaid Inspector General (OMIG). The contract, subject to successful finalization, is set to span up to five years, with an initial three-year period and an option for two one-year extensions.
The company will bring its expertise in technology-driven claims review services to the New York State Medicaid Program, aiming to identify and correct improper post-payment claims. This effort is part of OMIG's broader program integrity strategy.
Simeon Kohl, CEO of Performant, expressed pride in the company's nearly two decades of experience in payment integrity, viewing this award as an entry into the significant state Medicaid market, which is estimated to generate between $300 to $500 million in annual revenue. Kohl also emphasized the company's value proposition and its readiness to support OMIG's integrity efforts.
This development reinforces Performant's established presence in the government sector, where it holds three out of five CMS RAC contracts and operates as the exclusive partner for CMS's Medicare Secondary Payer Commercial Repayment Center (MSP CRC). The company is also the national audit contractor for the U.S. Department of Health and Human Services Office of the Inspector General.
Kohl reiterated Performant's commitment to its clients and the company's vision for future growth, acknowledging the trust placed in them by the New York State OMIG and expressing eagerness to initiate the engagement following the contract's execution.
Performant provides services to healthcare payers, including eligibility-based coordination-of-benefits (COB) and claims-based services, such as the audit and identification of improperly paid claims. The company operates in both government and commercial healthcare markets, offering additional services like advanced reporting capabilities, customer care, and training programs to prevent future improper payments.
The information in this article is based on a press release statement from Performant Financial Corporation.
"In other recent news, Performant Financial announced substantial growth in its Q1 2024 earnings, coupled with a notable increase in year-over-year revenue. The company launched 10 new programs with existing clients, anticipated to generate an annualized revenue between $5 million and $6 million. Furthermore, Performant's eligibility and clinical audit businesses saw growth rates of 7% and 19% respectively. The company also disclosed the acquisition of RecordsOne, a move aimed at enhancing audit workflow processes.
In addition to these developments, Performant Financial held its Annual Meeting of Stockholders, during which Lisa C. Im and Bradley M. Fluegel were elected as Class III directors. The company's independent auditor, Baker Tilly US, LLP, was ratified for the fiscal year ending December 31, 2024. Shareholders also approved amendments to the company's 2012 Stock Incentive Plan and the 2024 Employee Stock Purchase Plan.
Despite operating expenses of $31.3 million, Performant's adjusted EBITDA surpassed expectations at negative $1.2 million. The company maintains its full-year guidance, projecting healthcare revenues between $117 million and $120 million, and total company revenue ranging from $124 million to $129 million. These recent developments underscore Performant's strategic initiatives to sustain growth and enhance operational efficiency."
InvestingPro Insights
As Performant Financial Corporation (NASDAQ:PFMT) prepares to enhance its role in the Medicaid space with the New York State Medicaid Recovery Audit Contractor award, investors and stakeholders may find the latest InvestingPro data and tips insightful for understanding the company's financial health and market position.
InvestingPro data indicates that Performant has a market capitalization of $271.71 million, which reflects the company's relative size in the industry. Despite facing challenges in profitability, as shown by a negative P/E ratio of -42.05 and an operating income margin of -4.53% for the last twelve months as of Q2 2024, the company has demonstrated a revenue growth of 10.77% during the same period. This growth is further evidenced by a quarterly revenue increase of 15.21% in Q2 2024, underscoring Performant's potential for future financial improvements.
InvestingPro Tips suggest that while analysts do not expect the company to be profitable this year, Performant's liquid assets exceed its short-term obligations, indicating a level of financial flexibility. Additionally, the company operates with a moderate level of debt, which could be a strategic advantage in managing financial stability. It is also noteworthy that Performant's stock is trading near its 52-week high, with a price 91.97% of the 52-week high, which may reflect investor optimism about the company's prospects.
While Performant does not pay dividends, reflecting a reinvestment strategy or a focus on capital growth, the company has experienced a strong return over the last five years. Investors interested in Performant's performance trajectory can find additional insights, with a total of seven InvestingPro Tips available at https://www.investing.com/pro/PFMT.
As Performant embarks on this significant contract with New York State OMIG, these financial metrics and insights provide a broader context for evaluating the company's potential for growth and the impact of this new engagement on its future performance.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.