CareMedic Systems, Inc. Positioned to Assist Hospitals in Largest Medicare Conversion.

Business Editors/Health/Medical Writers

ST. PETERSBURG, Fla.--(BUSINESS WIRE)--July 2, 2003

Approx. 6,000 Medical Facilities Switch from Mutual of Omaha's

Arkansas Part A Shared System to Fiscal Intermediary Standard System

Healthcare facilities nationwide are preparing to comply with the single, largest Medicare-mandated conversion from Mutual of Omaha's Arkansas Part A Shared System (APASS) to the Fiscal Intermediary Standard System (FISS), which took place June 30, 2003. The conversion will affect more than 6,000 hospitals, skilled nursing facilities and other types of providers, with an estimated monthly volume of 1.5 million Medicare claims. At the time of the conversion, all Medicare claims pending for resolution by the provider (location 65) will be purged and require resubmission by the facilities.

"When a conversion of this proportion takes place, hospitals are looking for an efficient and effective transition that can help them avoid an increase in the Medicare accounts receivables days, and the costly consequences of decreased cash flow," said Sheila Schweitzer, President and Chief Operating Officer of CareMedic Systems, Inc. "CareMedic is at the forefront of helping hospitals prepare by offering strategies and technology they can employ to handle this challenge before and after the conversion deadline."

CareMedic is able to offer hospital financial executives a complimentary consultation that will analyze the impact the conversion will have on their days in accounts receivable. CareMedic has generated an e-mail outreach campaign to inform hospitals about the pending deadline.

On June 27, 2003, Mutual of Omaha deleted all pending claims that required correction by the hospital. Mutual of Omaha will then mail the list of deleted claims to the respective hospitals. The hospitals will be required to re-bill/re-file the claims with Mutual of Omaha. The resubmitted claims will be processed utilizing the FISS.

CareMedic's Reconciliation Service, an outsourced historical Medicare claims reconciliation program, can reconcile the hospitals' Medicare Part A claims receivables with Medicare's pending claims file. The Reconciliation Service identifies and helps recapture pending claims or claims suspended by Medicare. CareMedic has the ability to re-file these claims electronically on FISS in real-time, without requiring additional data elements that may be required for a HIPAA 837. CareMedic will also provide the hospitals with expert Medicare staff members to facilitate the claims reconciliation and re-billing processes.

"Being prepared to offer hospitals a strategic answer to the challenge this conversion presents is indicative of what CareMedic can do for hospitals throughout their revenue cycle," said Michael Vasquez, Chief Executive Officer of CareMedic Systems, Inc. "The benefit can be measured both in dollars, and in the assurance that we will help them avoid a sense of crisis in their billing operations and possible drop in their receivables performance."

About CareMedic Systems, Inc.

CareMedic Systems, Inc. (www.caremedic.com), headquartered in St. Petersburg, FL, is a healthcare solutions firm specializing in Medicare reimbursement software and services for healthcare facilities nationwide. The company's premier product is a suite of Medicare automation tools that provides real-time, pre-submission review by Medicare's computers, which allows virtual claim review and timely analysis of cash owed by Medicare to the facility, including claims purged by Medicare. CareMedic Systems enables healthcare facilities to accelerate cash flow -- by millions of dollars for most large hospitals --and redirect up to 50% of staff time involved in the Medicare process to other payers.