CodeSmart(TM) Holdings, Inc. Issues Letter to Shareholders
August 26 2013 - 1:00PM
CodeSmartTM Holdings, Inc. (OTCQB:ITEN), with its subsidiary, The
CODESMARTTM Group, Inc. (collectively, "CODESMART"), a premier
ICD-10 education and solutions group that offers CODESMARTTM
UNIVERSITY, its on-line education solution and customizable
training solutions, issues the following letter to shareholders:
To: CODESMART Holdings, Inc. (ITEN) Shareholders From: Ira
Shapiro, Chairman & CEO
Dear Shareholders:
First of all, I want to thank all of you for being investors in
CODESMART and demonstrating your belief in our mission by becoming
part of the CODESMART family. As many people know by now, ICD-10
presents a challenge that the healthcare industry must face as it
is required for all covered U.S. health entities by October 1,
2014. In fact, it is often repeated that industry analysts believe
that ICD-10 will exceed Y2K with respect to cost and impact.1 All
healthcare providers and payers will be required to code utilizing
the ICD-10 system of coding to replace ICD-9 which was developed in
the 1970s and was constrained by the technology and knowledge of
the time. ICD-10 expands the number of codes from approximately
14,000 to 76,000 and proper coding requires knowledge of biology,
anatomy chemistry and other subjects totaling approximately 900
hours of training for new coders, approximately 250 hours of
training for existing coders and approximately 10 hours of training
for clinicians.
It has been an exciting start since we went public. While we are
young as a public company, we have been three years in the making
working with Florida International University to develop and
deliver our ICD-10 curriculum and training. Already, CODESMART:
- has been endorsed by AMERINET as the premier provider of ICD-10
services; and
- has reached agreement with 70 accredited colleges and
universities to white label the CODESMART UNIVERSITY® curriculum;
and
- is the featured solution according to the ICD-10 PlayBook of
Health Information Management Systems Society ("HIMMS"), the
largest national healthcare association.
We have established a footprint in the industry and a
distribution for sales that we believe will support our sales and
earnings forecasts. Supporting our seasoned management team,
CODESMART is set to commence a direct marketing campaign through My
Data Guru and The College Network, on September 4, 2013. We
anticipate that this can result in an average of 1,500 to 2,000
student leads per month. Equally important, each of these
partners provides an enrollment function for closing the leads and
registering students. The College Network also has provided
CODESMART and its students an option to finance their tuition over
time to broaden our potential student base. Both of these
organizations have a very successful track record in helping
generate hundreds of new students monthly for other major on-line
universities over the past decade. We believe that CODESMART's new
coder program has no equal in the market today.
Revenue Development
As I write this letter to you, some very exciting new things are
taking place as it relates to revenue growth. We are now
starting to feel the realization by providers that they will have
to begin the transition to ICD-10 over the next few years and that
this must happen now. According to Forbes Magazine and Ernst &
Young, the opportunity is great because only 5% of physicians have
started their ICD-10 training. Most hospitals and other healthcare
facilities are very behind the curve as well. This is resulting in
new contracts from providers for CODESMART and that means revenue
begins to accelerate now. Our distribution channels are beginning
to produce, and specifically, two of our major partners: Amerinet
and Ciracet, are both very active and utilizing their large sales
teams to promote CODESMART nationally. Just as an example, Amerinet
already has produced over 30 letters of commitment from member
healthcare facilities for utilization of CODESMART services.
If we continue on the track we are on, I believe we will
achieve our revenue and profit goals that were previously disclosed
for 2013 and beyond. We believe we have access to a large market of
potential students which we estimate to be over 40 million people
looking for careers at any given time. The challenge now will be
for us to properly nurture the distribution relationships we
currently have in place and making sure we continue to create a
market presence and industry brand leadership as the superior
education program in ICD-10 that we truly are.
The CODESMART team and I sincerely thank all of you for your
support and we are looking forward to a very exciting and
successful future together.
Best Regards,
Ira Shapiro Chairman & CEO
Safe Harbor Statement under the Private Securities
Litigation Reform Act of 1995
Certain written and oral statements made by the Company may
constitute "forward-looking statements" as defined in the Private
Securities Litigation Reform Act of 1995 (the "Reform Act").
Forward-looking statements are identified by such words and phrases
as "we expect," "expected to," "estimates," "estimated," "current
outlook," "we look forward to," "would equate to," "projects,"
"projections," "projected to be," "anticipates," "anticipated," "we
believe," "could be," and other similar phrases. All statements
addressing operating performance, events, or developments that
either expect or anticipate will occur in the future, including
statements relating to revenue growth, earnings, earnings-per-share
growth, or similar projections, are forward-looking statements
within the meaning of the Reform Act. Because they are
forward-looking, they should be evaluated in light of important
risk factors that could cause actual results to differ materially
from anticipated results. The information provided in this document
is based upon the facts and circumstances known at this time. The
Company undertakes no obligation to update these forward-looking
statements after the date of this release.
1 "Replacing ICD-9-CM with ICD-10-CM and ICD-10-PCS: Challenges,
Estimated Costs, and Potential Benefits," Robert E. Nolan Company,
October 2003, page 6; "ICD-10 Turning Regulatory Compliance into
Strategic Advantage," Deloitte Center for Health Solutions, summer
2009.
CONTACT: Company Contact:
Ira Shapiro
Chairman and CEO
The Codesmart Group, Inc.
ishapiro@codesmartgroup.com
646-526-7867
Investor Contact:
John Baldissera
BPC Financial Marketing
800-368-1217
Media Contact:
Jules Abraham
JQA Partners, LLC
jabraham@jqapartners.com
917-885-7378