) Enterprise Services arm signed a 2-year service renewal deal
related to the Medicaid program with Florida Agency for Health
Care Administration (AHCA). Per the $109 million contract H-P
will manage Florida's Medicaid Management Information System
(MMIS) through Jun 2018.
H-P already serves 114k healthcare providers of the state and
processes in excess of 150 million claims per year valued at
approximately $24 billion. Moreover, as a fiscal agent, H-P
reviews and processes all medical claims, and also manages
finances, provides call center support and upgrades call center
H-P's services help the state to improve Medicaid programs,
deliver more critical health information to a larger number of
healthcare providers and keep pace with nationwide healthcare
reforms in a cost effective manner.
H-P acts as the fiscal agent or the IT provider to 19 other
states' Medicaid programs. The need for an efficient Medicaid
program arises from the enactment of the U.S. Healthcare Reforms
Bill which aims to make healthcare more affordable for Americans.
We believe that H-P, with its strong position, would be able to
capitalize on these government initiatives
Per the Act, beneficiaries are expected to join Medicaid
through a registration process, which requires exchange of
information regarding health. Medicaid is a joint endeavor of
state authorities and the Federal government, designed to provide
medical care to those under the federal poverty level, including
expectant mothers and children.
However, H-P has to compete with
Computer Sciences Corp.
) in the Medicaid service space. H-P's growing focus on new
business segments, such as electronic medical records, cloud
computing and the recently-added analytics segment will help the
company grow in the ensuing quarters.
Nonetheless, H-P is still reeling under pressure from the
declining PC business and sluggish macroeconomic environment. The
company has also hinted at muted revenue growth in 2014.
Moreover, competition from other technology bellwethers such as
) makes it even more difficult for the company to gain market
share in the cloud and security space.
Currently, H-P has a Zacks Rank #3 (Hold).
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