Santa Ana-based AMG-SIU Inc. is in a good place in bad times.
The company works with insurers and governments to detect and cut healthcare waste, fraud and abuse. Insurers like AMG-SIU for its potential to limit rising healthcare costs, something that could trickle down to employers.
AMG-SIU’s business has a high-profile cheerleader in President Obama, who has made cutting rising healthcare costs a key part of his reform efforts.
The presidential push and efforts by insurers and government health plans are spurring AMG-SIU, according to Dennis Demetre, the company’s chief executive and cofounder.
“We’ve been growing,” he said. “In fact, we’ve tripled our business over the last year.”
AMG-SIU, which has 45 workers, expects to see revenue of about $15 million this year, according to Demetre.
The company’s hired 10 workers so far this year and is expanding its computers.
AMG-SIU uses investigators and computers to monitor healthcare claims submitted by doctors and other healthcare providers.
The company works with state governments on Medicaid, the federal program that works with states to provide care to the poor. AMG-SIU also works with the federal government’s Medicare program for seniors.
Private clients include San Diego hospital operator and healthcare provider Sharp HealthCare, Kern Family Health Care in Bakersfield and El Paso First Health Plans Inc. in Texas.
Other clients include third-party administrators, which handle benefits for companies that run their own health insurance.
AMG-SIU works with private and government clients in about 40 states. The company is in talks with “several companies and a few state governments” now, Demetre said.
“Fraud is fraud wherever you happen to go,” he said.
Rivals include San Francisco’s McKesson Corp., TriZetto Group Inc., a Newport Beach healthcare technology company, and Ingenix Inc., part of Minnesota’s UnitedHealth Group Inc. They offer fraud reduction help along with other services.
AMG-SIU’s focus is on fraud and waste reduction.
“We know that one size does not fit all,” said Lori Lewis, cofounder and chief operating officer.
The company goes after business with its own salespeople, business partners and the Internet.
“We worked completely word-of-mouth up until not too long ago,” Lewis said.
AMG-SIU has funded itself.
“We roll the money back in to the company, so we have some very big reserves,” Lewis said
Some large investors have expressed interest in “sharing the wealth, but we’re not quite sure we want to do that,” Demetre said.
AMG-SIU isn’t interested in acquisitions, the executives said. The company is open to joint ventures, according to Lewis.
Demetre and Lewis earlier worked at a unit of Columbia/HCA Health-care Corp.
The for-profit hospital operator, now Nashville-based HCA Inc., paid $1.7 billion to the government a decade ago for Medicare and Medicaid fraud. It was one of the largest fraud settlements in the U.S. at the time.
AMG-SIU started out processing claims and offering other services to insurers to control costs.
The company’s focus on fraud, waste and abuse came into play about five years ago after requests from clients.
“It kind of morphed into a specialty,” Demetre said.
