SurgLine International, Inc. Launches A Wholly Owned Operating Subsidiary To Pursue Cost Containment Strategies

WEST PALM BEACH, Fla., April 23, 2012 /PRNewswire via COMTEX/ — SurgLine International, Inc.
Thomas Toland, CEO of SurgLine International, Inc. (“SGLN”) and SurgLine, Inc. (“SurgLine”) stated that the Company is pleased to announce that SurgLine has formed SurgLine MDC Holdings, LLC. (“SMDC”), a Delaware Limited Liability Corporation, as a wholly owned subsidiary. SMDC will be forming joint-venture opportunities with spine surgeons and other orthopedic surgeons in markets around the country. The purpose and focus of SMDC will be on achieving cost containment of surgical implants in the operating room for hospitals and acute surgery centers (“ASC”).These Joint Ventures will be structured whereby SMDC will own a minimum of 60% of each operating entity and participating surgeons will own up to 40% of the operating entity.SurgLine was assisted in developing this joint-venture strategy by one of the most well-known healthcare law firms on the West Coast. The joint venture structure has been designed to comply with all regulatory issues including federal anti-kickback legislation as well as state law(s).The goal of each of these joint-ventures is to partner with key physician leaders within their communities and to reduce the cost of surgical implants in the operating room, develop quality assurance standards for procedures performed, and to develop and track patient outcomes for the payer community while holding down the rising prices of implants charged to hospitals and ASC’s.Mr. Toland was quoted as saying, “This is not the typical physician owned distributorship (“POD”) strategy that has existed in the past, where surgeons and business operators charged as much as they can get away with. Each of our free standing entities will focus on reducing the cost of high priced surgical implant hardware sold to hospitals and surgery centers while working hand-in-hand to deliver more cost effective solutions.” Mr. Toland went on to say, “I have met with risk managers and case managers for insurance companies and discussed this strategy with them in detail. The consensus is that the payer community wishes to see real reductions in cost while delivering high quality outcomes for their patients and full disclosure of ownership by any physician who may be an investor.”