PMSI is for sale
The largest workers compensation PBM, PMSI-Tmesys, is on the block. The company's owner announced the sale yesterday, noting that it is being spun off so the parent, Amerisouce Bergen, can concentrate on the core business of drug distribution.
PMSI-Tmesys has suffered through client losses of late, the latest CNA's departure at the end of last year. Declining margins may also have played a role in the decision, as price pressure from competitors, coupled with the drastic cuts in reimbursement in NY and CA, have likely contributed to the company's failure to meet financial goals in 2007.
With revenues exceeding $400 million, PMSI-Tmesys is the leader in the space, providing drugs, durable medical equipment, and other services to many WC payers. Reading between the virtual lines, it looks like Amerisource's senior management is expecting a strategic buyer, as the company has been in the process of shopping PMSI-Tmesys for a few weeks already.
More to follow...
Comments
Joe,
That's what you get when you hire Group Health people to run a Work Comp vendor. Combine that with poor talent management and a complete absence of succession planning and what you are left with is a decline in revenue of almost 30% and the downfall of one of the original PBMs.
In December of 2006 PMSI offered me the position of Director of National Accounts, including full relocation from Chicago to Tampa. The relocation alone sounded good considering it was December and I was in Chicago. On Monday of my second week I was introduced to my new boss (my second in 6 days), by that Thursday I was informed another VP had been hired and I would be reporting to her (my third boss in 9 days), even though she would remain in Dallas. Immediately I knew my days were numbered. I lasted a total of 38 days. The reason for my exit was " it was not a good fit". It was more likely that the new VP came from the Group health side of the business and had no idea how to work with Work Comp Claims professionals
The total amount PMSI spent on my salary and relocation costs was not a large percentage of PMSI's revenue, but it does speak to the lack of strategy, communication, and cohesiveness of the Current, and likely to be former, executive staff.
Posted by: David Lencioni | January 25, 2008 12:21 PM