Document_And_Entity_Informatio
Document And Entity Information | 3 Months Ended | |
Mar. 31, 2015 | 1-May-15 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | PACIFIC HEALTH CARE ORGANIZATION INC | |
Document Type | 10-Q | |
Current Fiscal Year End Date | -19 | |
Entity Common Stock, Shares Outstanding | 797,714 | |
Amendment Flag | FALSE | |
Entity Central Index Key | 1138476 | |
Entity Current Reporting Status | Yes | |
Entity Voluntary Filers | No | |
Entity Filer Category | Smaller Reporting Company | |
Entity Well-known Seasoned Issuer | No | |
Document Period End Date | 31-Mar-15 | |
Document Fiscal Year Focus | 2015 | |
Document Fiscal Period Focus | Q1 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
Current Assets | ||
Cash | $3,216,827 | $2,946,025 |
Accounts receivable, net of allowance of $48,833 and $40,510 | 2,027,750 | 1,868,181 |
Prepaid income tax | 2,703 | 2,703 |
Deferred tax asset | 77,059 | 77,059 |
Prepaid expenses | 79,776 | 77,278 |
Total current assets | 5,404,115 | 4,971,246 |
Property and Equipment, net | ||
Computer equipment | 234,379 | 222,240 |
Furniture and fixtures | 92,191 | 92,191 |
Office equipment | 27,160 | 27,160 |
Office equipment under capital lease | 38,380 | 63,923 |
Total property and equipment | 392,110 | 405,514 |
Less: accumulated depreciation | -213,572 | -226,329 |
Net property and equipment | 178,538 | 179,185 |
Other Assets | 0 | 8,158 |
Total assets | 5,582,653 | 5,158,589 |
Current Liabilities | ||
Accounts payable | 170,815 | 240,214 |
Accrued expenses | 221,596 | 261,510 |
Income tax payable | 11,534 | 9,348 |
Current obligations under capital lease | 4,701 | 8,151 |
Deferred rent expense | 11,822 | 14,332 |
Unearned revenue | 40,206 | 0 |
Total current liabilities | 460,674 | 533,555 |
Commitments and Contingencies | 0 | 0 |
Shareholders’ Equity | ||
Preferred stock; 5,000,000 shares authorized at $0.001 par value; zero shares issued and outstanding | 0 | 0 |
Common stock, $0.001 par value 50,000,000 shares authorized at March 31, 2015 and December 31, 2014; 802,424 shares issued, (800,136 outstanding net of treasury shares) and 802,424 shares issued, (800,396 outstanding net of treasury shares), respectively | 800 | 800 |
Additional paid-in capital | 623,631 | 623,631 |
Treasury stock at cost (2,288 shares and 2,028 shares at March 31, 2015 and December 31, 2014), respectively | -88,011 | -76,715 |
Retained earnings | 4,585,559 | 4,077,318 |
Total stockholders' equity | 5,121,979 | 4,625,034 |
Total liabilities and stockholders’ equity | $5,582,653 | $5,158,589 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Parentheticals) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
Accounts receivable, allowance (in Dollars) | $48,833 | $40,510 |
Preferred stock, par value (in Dollars per share) | $0.00 | $0.00 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock par value (in Dollars per share) | $0.00 | $0.00 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 802,424 | 802,424 |
Common stock, shares outstanding | 800,136 | 800,396 |
Treasury stock | 2,288 | 2,028 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Operations (Unaudited) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Revenues: | ||
HCO fees | $248,640 | $259,484 |
MPN fees | 308,118 | 253,429 |
UR fees | 1,014,290 | 725,855 |
MBR fees | 370,414 | 475,220 |
NCM fees | 244,472 | 254,129 |
Other | 183,164 | 60,552 |
Total revenues | 2,369,098 | 2,028,669 |
Expenses: | ||
Depreciation | 12,786 | 11,155 |
Bad debt provision | 8,250 | 8,253 |
Consulting fees | 90,190 | 75,899 |
Salaries and wages | 685,811 | 586,827 |
Professional fees | 120,346 | 105,612 |
Insurance | 84,757 | 68,648 |
Outsource service fees | 337,747 | 264,568 |
Data maintenance | 7,285 | 19,171 |
General and administrative | 151,369 | 123,361 |
Total expenses | 1,498,541 | 1,263,494 |
Income from operations | 870,557 | 765,175 |
Other expense | ||
Interest expense | 130 | 379 |
Total other expense | 130 | 379 |
Income before taxes | 870,427 | 764,796 |
Income tax provision | 362,186 | 318,235 |
Net income | $508,241 | $446,561 |
Basic and fully diluted earnings per share: | ||
Earnings per share amount (in Dollars per share) | $0.64 | $0.56 |
Weighted average common shares outstanding (in Shares) | 800,136 | 802,424 |
Condesed_Consolidated_Statemen
Condesed Consolidated Statements of Cash Flows (Unaudited) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Cash flows from operating activities: | ||
Net income | $508,241 | $446,561 |
Adjustments to reconcile net income to net cash: | ||
Depreciation | 12,786 | 11,155 |
Changes in operating assets & liabilities | ||
Increase in bad debt provision | 8,323 | 8,253 |
(Increase) in accounts receivable | -167,892 | -178,671 |
Decrease in prepaid income tax | 0 | 6,568 |
(Increase) decrease in prepaid expenses | -2,498 | 10,942 |
Decrease (increase) in other assets | 8,158 | -5,545 |
(Decrease) in accounts payable | -69,399 | -17,715 |
(Decrease) in deferred rent expense | -2,510 | -1,450 |
(Decrease) increase in accrued expenses | -39,914 | 71,437 |
Increase in income tax payable | 2,186 | 133,668 |
Increase in unearned revenue | 40,206 | 0 |
Net cash provided in operating activities | 297,687 | 485,203 |
Cash flows from investing activities: | ||
Purchase of furniture and office equipment | -12,139 | -16,148 |
Net cash used in investing activities | -12,139 | -16,148 |
Cash flows from financing activities: | ||
Purchase of treasury stock | -11,296 | 0 |
Payment of obligation under capital lease | -3,450 | -3,202 |
Net cash used in financing activities | -14,746 | -3,202 |
Increase in cash | 270,802 | 465,853 |
Cash at beginning of period | 2,946,025 | 1,265,535 |
Cash at end of period | 3,216,827 | 1,731,388 |
Cash paid for: | ||
Interest | 131 | 383 |
Income taxes paid | $360,000 | $178,000 |
NOTE_1_BASIS_OF_FINANCIAL_STAT
NOTE 1 - BASIS OF FINANCIAL STATEMENT PRESENTATION | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Accounting Policies [Abstract] | |||||||||
Organization, Consolidation and Presentation of Financial Statements Disclosure and Significant Accounting Policies [Text Block] | NOTE 1 - BASIS OF FINANCIAL STATEMENT PRESENTATION | ||||||||
The accompanying unaudited condensed consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (the “Commission”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted in accordance with such rules and regulations. The information furnished in the interim condensed consolidated financial statements includes normal recurring adjustments and reflects all adjustments, which, in the opinion of management, are necessary for a fair presentation of such financial statements. Although management believes the disclosures and information presented are adequate to make the information not misleading, it is suggested that these interim condensed financial statements be read in conjunction with the Company’s audited financial statements and notes thereto included in its Annual Report on Form 10-K for the year ended December 31, 2014. Operating results for the three months ended March 31, 2015 are not necessarily indicative of the results to be expected for the year ending December 31, 2015. | |||||||||
Revenue Recognition — In general, the Company recognizes revenue when (i) persuasive evidence of an arrangement exists, (ii) delivery has occurred or services have been rendered, (iii) the fee is fixed or determinable and (iv) collectability is reasonably assured. Revenues are generated as services are provided to the customer based on the sales price agreed and collected. The Company recognizes revenue as the time is worked or as units of production are completed, which is when the revenue is earned and realized. Labor costs are recognized as the costs are incurred. The Company derives its revenue from the sale of Managed Care Services, Review Services, Case Management Services and Lien Representation Services. These services may be sold individually or in combination. When a sale combines multiple elements, the Company accounts for multiple-deliverable revenue arrangements in accordance with the guidance included in ASC 605-25, the services, however, are typically billed as separate components in accordance with the customer’s service agreement. | |||||||||
These fees include monthly administration fees, claim network fees, flat rate fees or hourly fees depending on the agreement with the client. Such revenue is recognized at the end of each month for which services are performed. | |||||||||
Management reviews each agreement in accordance with the provision of the revenue recognition topic ASC 605 that addresses multiple-deliverable revenue arrangements. The multiple-deliverable arrangements entered into consist of bundled managed care which includes various units of accounting such as network solutions and patient management which includes managed care. Such elements are considered separate units of accounting due to each element having value to the customer on a stand-alone basis. The selling price for each unit of accounting is determined using contract price. When the Company’s customers purchase several products the pricing of the products sold is generally the same as if the products were sold on an individual basis. Revenue is recognized as the work is performed in accordance with the Company’s customer contracts. Based upon the nature of the Company’s products, bundled managed care elements are generally delivered in the same accounting period. The Company recognizes revenue for patient management services ratably over the life of the customer contract. Based on prior experience in managed care, the Company estimates the deferral amount from when the customer’s claim is received to when the customer contract expires. Advance payments from subscribers and billings made in advance are recorded on the balance sheet as deferred revenue. | |||||||||
Accounts Receivables and Bad Debt Allowance – In the normal course of business the Company extends credit to its customers on a short-term basis. Although the credit risk associated with these customers is minimal, the Company routinely reviews its accounts receivable balances and makes provisions for doubtful accounts. The Company ages its receivables by date of invoice. Management reviews bad debt reserves quarterly and reserves specific accounts as warranted or sets up a general reserve based on amounts over 90 days past due. When an account is deemed uncollectible, the Company charges off the receivable against the bad debt reserve. A considerable amount of judgment is required in assessing the realization of these receivables including the current creditworthiness of each customer and related aging of the past-due balances, including any billing disputes. In order to assess the collectability of these receivables, the Company performs ongoing credit evaluations of its customers’ financial condition. Through these evaluations, the Company may become aware of a situation where a customer may not be able to meet its financial obligations due to deterioration of its financial viability, credit ratings or bankruptcy. The allowance for doubtful accounts is based on the best information available to the Company and is reevaluated and adjusted as additional information is received. The Company evaluates the allowance based on historical write-off experience, the size of the individual customer balances, past-due amounts and the overall national economy. At March 31, 2015 and December 31, 2014, our bad debt reserve of $48,833 and $40,510, respectively as a general reserve for certain balances over 90 days past due and for accounts that are potentially uncollectible. | |||||||||
The percentages of the amounts due from major customers to total accounts receivable as of March 31, 2015 and 2014 are as follows: | |||||||||
3/31/15 | 3/31/14 | ||||||||
Customer A | 29 | % | 28 | % | |||||
Customer B | 21 | % | 24 | % | |||||
Reclassifications – Certain 2014 quarterly balances have been reclassified to conform to the 2015 presentation. The reclassifications have had no effect on the financial position, operations or cash flows for the quarter ended March 31, 2015. | |||||||||
NOTE_2_SUBSEQUENT_EVENTS
NOTE 2 - SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2015 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | NOTE 2 - SUBSEQUENT EVENTS |
In accordance with ASC 855-10 Company management reviewed all material events through the date of issuance and there are no material subsequent events to report. | |
Accounting_Policies_by_Policy_
Accounting Policies, by Policy (Policies) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Accounting Policies [Abstract] | |||||||||
Revenue Recognition, Policy [Policy Text Block] | Revenue Recognition — In general, the Company recognizes revenue when (i) persuasive evidence of an arrangement exists, (ii) delivery has occurred or services have been rendered, (iii) the fee is fixed or determinable and (iv) collectability is reasonably assured. Revenues are generated as services are provided to the customer based on the sales price agreed and collected. The Company recognizes revenue as the time is worked or as units of production are completed, which is when the revenue is earned and realized. Labor costs are recognized as the costs are incurred. The Company derives its revenue from the sale of Managed Care Services, Review Services, Case Management Services and Lien Representation Services. These services may be sold individually or in combination. When a sale combines multiple elements, the Company accounts for multiple-deliverable revenue arrangements in accordance with the guidance included in ASC 605-25, the services, however, are typically billed as separate components in accordance with the customer’s service agreement. | ||||||||
These fees include monthly administration fees, claim network fees, flat rate fees or hourly fees depending on the agreement with the client. Such revenue is recognized at the end of each month for which services are performed. | |||||||||
Management reviews each agreement in accordance with the provision of the revenue recognition topic ASC 605 that addresses multiple-deliverable revenue arrangements. The multiple-deliverable arrangements entered into consist of bundled managed care which includes various units of accounting such as network solutions and patient management which includes managed care. Such elements are considered separate units of accounting due to each element having value to the customer on a stand-alone basis. The selling price for each unit of accounting is determined using contract price. When the Company’s customers purchase several products the pricing of the products sold is generally the same as if the products were sold on an individual basis. Revenue is recognized as the work is performed in accordance with the Company’s customer contracts. Based upon the nature of the Company’s products, bundled managed care elements are generally delivered in the same accounting period. The Company recognizes revenue for patient management services ratably over the life of the customer contract. Based on prior experience in managed care, the Company estimates the deferral amount from when the customer’s claim is received to when the customer contract expires. Advance payments from subscribers and billings made in advance are recorded on the balance sheet as deferred revenue. | |||||||||
Receivables, Policy [Policy Text Block] | Accounts Receivables and Bad Debt Allowance – In the normal course of business the Company extends credit to its customers on a short-term basis. Although the credit risk associated with these customers is minimal, the Company routinely reviews its accounts receivable balances and makes provisions for doubtful accounts. The Company ages its receivables by date of invoice. Management reviews bad debt reserves quarterly and reserves specific accounts as warranted or sets up a general reserve based on amounts over 90 days past due. When an account is deemed uncollectible, the Company charges off the receivable against the bad debt reserve. A considerable amount of judgment is required in assessing the realization of these receivables including the current creditworthiness of each customer and related aging of the past-due balances, including any billing disputes. In order to assess the collectability of these receivables, the Company performs ongoing credit evaluations of its customers’ financial condition. Through these evaluations, the Company may become aware of a situation where a customer may not be able to meet its financial obligations due to deterioration of its financial viability, credit ratings or bankruptcy. The allowance for doubtful accounts is based on the best information available to the Company and is reevaluated and adjusted as additional information is received. The Company evaluates the allowance based on historical write-off experience, the size of the individual customer balances, past-due amounts and the overall national economy. At March 31, 2015 and December 31, 2014, our bad debt reserve of $48,833 and $40,510, respectively as a general reserve for certain balances over 90 days past due and for accounts that are potentially uncollectible. | ||||||||
The percentages of the amounts due from major customers to total accounts receivable as of March 31, 2015 and 2014 are as follows: | |||||||||
3/31/15 | 3/31/14 | ||||||||
Customer A | 29 | % | 28 | % | |||||
Customer B | 21 | % | 24 | % | |||||
Reclassification, Policy [Policy Text Block] | Reclassifications – Certain 2014 quarterly balances have been reclassified to conform to the 2015 presentation. The reclassifications have had no effect on the financial position, operations or cash flows for the quarter ended March 31, 2015. |
NOTE_1_BASIS_OF_FINANCIAL_STAT1
NOTE 1 - BASIS OF FINANCIAL STATEMENT PRESENTATION (Tables) (Credit Concentration Risk [Member]) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Credit Concentration Risk [Member] | |||||||||
NOTE 1 - BASIS OF FINANCIAL STATEMENT PRESENTATION (Tables) [Line Items] | |||||||||
Schedules of Concentration of Risk, by Risk Factor [Table Text Block] | The percentages of the amounts due from major customers to total accounts receivable as of March 31, 2015 and 2014 are as follows: | ||||||||
3/31/15 | 3/31/14 | ||||||||
Customer A | 29 | % | 28 | % | |||||
Customer B | 21 | % | 24 | % |
NOTE_1_BASIS_OF_FINANCIAL_STAT2
NOTE 1 - BASIS OF FINANCIAL STATEMENT PRESENTATION (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
Accounting Policies [Abstract] | ||
Allowance for Doubtful Accounts Receivable | $48,833 | $40,510 |
NOTE_1_BASIS_OF_FINANCIAL_STAT3
NOTE 1 - BASIS OF FINANCIAL STATEMENT PRESENTATION (Details) - Schedules of Credit Concentration Risk (Accounts Receivable [Member], Credit Concentration Risk [Member]) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Customer A [Member] | ||
Concentration Risk [Line Items] | ||
Credit Concentration Risk, Percentage | 29.00% | 28.00% |
Customer B [Member] | ||
Concentration Risk [Line Items] | ||
Credit Concentration Risk, Percentage | 21.00% | 24.00% |