OptimumCare to Report Loss in Quarter
OptimumCare Corp. said Thursday that it will report a fourth-quarter loss next week, blaming costs associated with canceling a contract with a Miami company.
The Laguna Niguel company, which manages mental health services in hospitals and clinics, predicted it will post a loss of 2 to 3 cents a share after taking a charge of 5 to 7 cents. But it will report an overall profit for last year.
It added that it will report “only a small profit” for its current quarter, again citing problems with the contractor, Galaxy Health Care Inc.
A little more than a year ago, OptimumCare announced it was teaming up with Galaxy to develop 40 community mental health centers. On Thursday, Edward A. Johnson, OptimumCare’s president, said the arrangement has “lost its momentum.”
The company cited contract problems, including slow billing and delays caused by an insurer’s audit of Galaxy. Optimum said Galaxy owes it more than $800,000.
Separately, Johnson said OptimumCare’s auditors have ruled that the company should write off $135,000 in costs associated with its acquisition two years ago of a controlling stake in its OptimumCareSource unit. The unit provides behavioral health care services at long-term care facilities.
