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PMSI Progressive Medical Merger – Small WC Companies Fading?

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PMSI and Progressive Medical Merger Causes Workers Comp Buzz

PMSI and Progressive Medical Merger shows that small WC companies  may not exist much longer in the insurance landscape.  The buzz at the end of last week and over the weekend was the surprising merger of two Workers Comp service titans.

Picture Of Couple With Progressive Medical Merger Financial Advisor
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The merger actually made sense from a financial standpoint as these two companies’ lines of service will complement each other very well.

The WC ancillary service market has long been contracting to a few major players.  The buyout and merger fever may just be a premonition of the future.

If one wanted to survey the “new” Workers Comp landscape, they had to look no further than the 2012 LRP Las Vegas conference.  Many of the booth workers had commented they were being bought out or had just acquired some type of ancillary service company.

PMSI was one of the WC originals for prescriptions, TENS units (are they still in use?), durable medical equipment, and other related services.  PMSI had and has always done a great job of face-to-face marketing.

Progressive Medical seemed to be one of the “late entrants” into the ancillary services market.  However, their stellar PBM services were cutting edge at the time.   The press release for Progressive Medical can be found here.   For convenience the press release on Progressive’s website is presented below.

Progressive Medical and PMSI announced today that the two companies have entered into a definitive agreement to merge. The transaction is expected to close in the fourth quarter subject to receipt of regulatory clearance. The combined company, which will be led by Executive Chairman Eileen Auen from PMSI and Co-CEOs Emry Sisson and Tommy Young from Progressive Medical, will deliver comprehensive workers’ compensation pharmacy benefit management services including end-to-end pharmacy, ancillary and settlement solutions.

Picture Of Two Businessman Shake Hands Progressive Medical Merger Agreement
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“Bringing together the resources and deep industry expertise of these two companies will enable the combined organization to continue to drive product innovation in the workers’ compensation marketplace while delivering operational and service excellence and ever improving clinical and cost containment services to our clients,” said Tommy Young, Co-CEO of Progressive Medical.
Eileen Auen, Chairman and CEO of PMSI, stated “The PMSI leadership team is delighted to partner with Progressive Medical. We will continue to deliver customized solutions to our clients, and I am personally excited about working closely with the combined team to bring unique solutions to our customers.”

“This merger will drive increased efficiency in the workers’ compensation business,” according to Emry Sisson, Co-CEO of Progressive Medical. “We will strategically leverage the capabilities of the combined organization to bring even greater value to our customers.”

Funds managed by Kelso & Company have agreed to acquire a significant ownership stake in
the combined company. StoneRiver Group, the controlling shareholder of Progressive Medical,
will continue to be a significant shareholder in the combined business.

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James Moore

Raleigh, NC, United States

About The Author...

James founded a Workers’ Compensation consulting firm, J&L Risk Mgmt Consultants, Inc. in 1996. J&L’s mission is to reduce our clients’ Workers Compensation premiums by using time-tested techniques. J&L’s claims, premium, reserve and Experience Mod reviews have saved employers over $9.8 million in earned premiums over the last three years. J&L has saved numerous companies from bankruptcy proceedings as a result of insurance overpayments.

James has over 27 years of experience in insurance claims, audit, and underwriting, specializing in Workers’ Compensation. He has supervised, and managed the administration of Workers’ Compensation claims, and underwriting in over 45 states. His professional experience includes being the Director of Risk Management for the North Carolina School Boards Association. He created a very successful Workers’ Compensation Injury Rehabilitation Unit for school personnel.

James’s educational background, which centered on computer technology, culminated in earning a Masters of Business Administration (MBA); an Associate in Claims designation (AIC); and an Associate in Risk Management designation (ARM). He is a Chartered Financial Consultant (ChFC) and a licensed financial advisor. The NC Department of Insurance has certified him as an insurance instructor. He also possesses a Bachelors’ Degree in Actuarial Science.

LexisNexis has twice recognized his blog as one of the Top 25 Blogs on Workers’ Compensation. J&L has been listed in AM Best’s Preferred Providers Directory for Insurance Experts – Workers Compensation for over eight years. He recently won the prestigious Baucom Shine Lifetime Achievement Award for his volunteer contributions to the area of risk management and safety. James was recently named as an instructor for the prestigious Insurance Academy.

James is on the Board of Directors and Treasurer of the North Carolina Mid-State Safety Council. He has published two manuals on Workers’ Compensation and three different claims processing manuals. He has also written and has been quoted in numerous articles on reducing Workers’ Compensation costs for public and private employers. James publishes a weekly newsletter with 7,000 readers.

He currently possess press credentials and am invited to various national Workers Compensation conferences as a reporter.

James’s articles or interviews on Workers’ Compensation have appeared in the following publications or websites:

  • Risk and Insurance Management Society (RIMS)
  • Entrepreneur Magazine
  • Bloomberg Business News
  • WorkCompCentral.com
  • Claims Magazine
  • Risk & Insurance Magazine
  • Insurance Journal
  • Workers Compensation.com
  • LinkedIn, Twitter, Facebook and other social media sites
  • Various trade publications

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