WeiserMazars LLP has expanded its health care practice as well as expanded into California with the acquisition of pmpm Consulting Group, a Sacramento-based health care consulting firm that specializes in providing managed care services.
The services include network development, contracting, credentialing, regulatory monitoring, oversight and compliance audits to payers and providers. The acquisition is expected to significantly expand WeiserMazars’ Health Care Practice. Russell Foster, the founder of pmpm, and another principal, Sheila Stephens, are joining WeiserMazars as principals, along with a team of six other professionals.
“It is a strategic addition to our health care practice,” said WeiserMazars CEO Doug Phillips in an interview Friday. “It’s strategic not only for health care but also geographically because it allows us to plant our flag in California.”
The office will be WeiserMazars’ first in California for the accounting, tax and advisory services firm. Initially it is only being used for the health care practice, but Phillips expects it to provide other services eventually as well.
“It is today exclusively a health care consulting practice, but it’s quite obvious that we’ve got clients out in California that need to be served,” he said. “Serving them from the California perspective will be strategically important for us.”
The firm currently has U.S. offices in New York, New Jersey, Pennsylvania, Philadelphia, South Florida, Chicago and now Sacramento. WeiserMazars also has offices in Israel and the Cayman Islands, and is affiliated with the international Mazars group, which operates across 72 countries.
Phillips is seeing growth in WeiserMazars’ health care consulting practice, especially as clients adjust to the Affordable Care Act. He noted that the practice has four key prongs: managed care, revenue cycle consulting, financial advisory and IT consulting.
“pmpm brings a particular specialty to enhance our managed care practice, but also gives us the platform in effect to be the West Coast hub of the four prongs of our health care practice,” he said.
New York-based WeiserMazars collaborated with pmpm over the course of 14 to 15 months on some common assignments before they began discussing an acquisition. “We had been working with them, it was a good experience, and the strategies converged,” Phillips explained. “Better to get married to someone you know than someone you don’t know.”
In addition, the acquisition will bring some major clients in the health care field. Including LA Care, Satellite Health Plan, Community Health Group, the Department of Managed Health Care, the California Association for Adult Day Services, along with other medical groups and health care organizations.
The effective date of the acquisition was July 1. The financial details are confidential, but Phillips said that annual revenues for pmpm were approximately $3 million, while for WeiserMazars it was $158 million before the acquisition, for a total of $162 million for the combined firm. WeiserMazars ranked 26th on Accounting Today’s 2014 list of the Top 100 Firms.
“We think there’s a lot to be done in health care and we are doing a lot, so we’re trying to seize some of the strategic opportunities that are available to us,” said Phillips. “California is a demographic hub. There are a lot of people out in California, so we think from all those aspects this is very interesting and exciting for us.”
Phillips indicated that there may be more M&A deals in the future in California. “We’ll do it prudently, of course, but growth is clearly on our agenda,” he said.