Profile: MedAssets, Inc. (MDAS.O)

MedAssets, Inc., incorporated in 1999, provides technology-enabled products and services, which together deliver solutions designed to improve operating margin and cash flow for hospitals and health systems. These solutions are offered primarily through Company-hosted software, or software as a service (SaaS), supported by enterprise-wide sales, account management, implementation services and consulting. The Company delivers its solutions through two business segments: Revenue Cycle Management, which provides a suite of products and services that span what has traditionally been viewed as the hospital revenue cycle, and Spend Management, which helps customers manage their non-labor expense categories through a combination of group purchasing, performance improvement consulting, including implantable physician preference items (PPI), cost and utilization management and service line consulting, and business intelligence tools. On June 2, 2008, the Company acquired Accuro Healthcare Solutions, Inc. (Accuro), which is a SaaS-based technology and services provider of revenue cycle management solutions.

As of December 31, 2008, the Company’s customer base included over 125 health systems and, including those that are part of health system customers, more than 3,300 acute care hospitals and approximately 30,000 ancillary or non-acute provider locations. Its group purchasing organization has contracts with more than 1,200 manufacturers, distributors and other vendors that pay administrative fees based on purchase volume by healthcare provider customers. No single customer or group purchasing organization vendor accounts for more than 4% of total net revenue during the year ended December 31, 2008. Additionally, the Company’s customers are located primarily throughout the United States.

Revenue Cycle Management

From a traditional revenue cycle solution, MedAssets has expanded the scope of revenue cycle to include clinical and administrative functions. It combines its revenue cycle workflow solutions with decision support and business intelligence tools to increase financial improvement opportunities and regulatory compliance for customers. Some customers choose to manage their revenue cycle using internal resources that are supplemented with the Company’s solutions. Other customers have chosen end-to-end solutions that use the Company’s suite of solutions spanning the entire revenue cycle workflow.

MedAssets offers solutions to address challenges in the following stages of the revenue cycle workflow: patient admission, charge capture, case management and health information management, claims processing, and denials and accounts receivable management. The Company’s decision support software provides customers with an integrated suite of tools designed to facilitate hospital decision-making by integrating clinical, financial and operational information into a common data set for accuracy and ease of use across the organization. Key components include budgeting, cost accounting, contract management, clinical analytics, key indication and department performance reporting.

In the revenue cycle management area, MedAssets competes with Eclipsys Corporation, McKesson Corporation, Medical Information Technology, Siemens Corporation, Inc., Accenture Ltd., Deloitte & Touche LLP, Ernst & Young LLP, Huron Consulting, Inc., Navigant Consulting, Inc., The Advisory Board Company, CareMedic Systems, Inc., Emdeon Business Services LLC, Passport Health Communications, Inc. and The SSI Group, Inc.

Spend Management

The cornerstone of the Company’s spend management solutions is the group purchasing organization, which uses a national contract portfolio consisting of over 1,500 contracts with approximately 1,200 manufacturers, distributors and other vendors, a custom and local contracting function and aggregated group buys, to connect manufacturers, distributors and other vendors with healthcare provider customers. MedAssets uses the aggregate purchasing power of healthcare provider customers to negotiate pricing discounts and improved contract terms with vendors. Contracted vendors pay the Company administrative fees based on the purchase price of goods and services sold to healthcare provider customers purchasing under the contracts MedAssets has negotiated.

The Company’s national portfolio of contracts provides access to a range of products and services offered through the following programs: medical/surgical supplies; pharmaceuticals; laboratory supplies; capital equipment; information technology; food and nutritional products; and purchased non-labor services. A custom contracting capability has also been developed to enable MedAssets to negotiate custom contracts on behalf of group purchasing organization customers. A program for aggregating customer purchases for capital intensive medical equipment has also been developed. After its in-house market research team identifies customer needs within defined capital product categories, such as diagnostic imaging and cardiac cath lab, the Company manages a bidding process for the combined volume of customer purchasers to identify the vendors that provide the greatest level of value, as defined by both clinical effectiveness and cost of ownership across the equipment lifecycle.

The data management and business intelligence tools of MedAssets are an integral part of its spend management solutions. These tools provide transparency into expenses, identify performance deficiencies and areas for operational improvement, and allow for monitoring and measuring results. Key components include tools for strategic information, customer master item file services and electronic contract portfolio catalog.

In the spend management area, the Company competes with Amerinet, Broadlane, HealthTrust LLC, Novation LLC and Premier, Inc.