What changed in this filing

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Item 1. Business

2022-03-16 compared with 2021-03-26 · 46 added, 63 removed, 42 unchanged (72% of the section changed)

4 unchanged sentences

on October 1, 2015.

We are a technology, marketing, billing, and collection company facilitating diagnostic services for patients who have sustained spine injuries resulting from traumatic accidents.

We deliver turnkey solutions to spine surgeons, orthopedic surgeons and other healthcare providers for necessary and appropriate treatment of musculo-skeletal spine injuries resulting from automobile and work-related accidents.

Our goal is to become a leader in providing technology and monetizing services to spine and orthopedic surgeons and other healthcare providers to facilitate proper treatment of their injured clients.

By monetizing the providers accounts receivable, which includes diagnostic testing and non-invasive surgical care, patients are not unnecessarily delayed or prevented from obtaining needed treatment.

By facilitating early treatment through affiliated doctors, we believe that health conditions can be prevented from escalating and injured victims can be quickly placed on the road to recovery.

Through our affiliate system, we facilitate spine surgeons, orthopedic surgeons and other healthcare providers to provide reasonable, necessary, and appropriate treatments to patients with musculo-skeletal spine injuries.

We assist the centers that provide the spine diagnostic injections and treatment and pay the doctors a fee for the medical procedures they performed.

After a patient is billed for the procedures performed by the affiliated doctor, we take control of the patients’ unpaid bill and oversee collection.

In most instances, the patient is a plaintiff in an accident case, where the patient is represented by an attorney.

Typically, the defendant (and/or the insurance company of the defendant) in the accident case pays the patient’s bill upon settlement or final judgment of the accident case.

The payment to us is made through the attorney of the patient.

In most cases, we must agree to the settlement price and the patient must sign off on the settlement.

Once we are paid, the patient’s attorney can receive payment for his or her legal fee.

During the fourth quarter of 2018, the decision was made to discontinue funding future medical procedures due to our cash position, and we have not funded any procedures in 2019 or 2020 and will not do so unless we can access additional capital.

We are actively pursuing a merger or similar transaction with a private company where it becomes the controlling company.

We find this to be the best course of action for our stockholders.

Further, we have been in negotiations with a certain third-party candidate since December 2021.

We are presently negotiating terms of a proposed share exchange agreement with the candidate, under which its shareholders would exchange their shares for shares of our stock.

Although we do not presently have a binding agreement with this company or its shareholders, it is possible that a definitive agreement for the proposed transaction could be agreed to and consummated in the imminent future.

There is no assurance that such transaction will be completed, or if completed, that the terms will be favorable to us.

From 2009 to 2018, we operated as a technology, marketing, billing, and collection company facilitating diagnostic services for patients who have sustained spine injuries resulting from traumatic accidents.

We delivered turnkey solutions to spine surgeons, orthopedic surgeons and other healthcare providers for necessary and appropriate treatment of musculo-skeletal spine injuries resulting from automobile and work-related accidents.

Through our affiliate system, we facilitated spine surgeons, orthopedic surgeons and other healthcare providers to provide reasonable, necessary, and appropriate treatments to patients with musculo-skeletal spine injuries.

We assisted the centers that provide the spine diagnostic injections and treatment and paid the doctors a fee for the medical procedures they performed.

After a patient was billed for the procedures performed by the affiliated doctor, we took control of the patients’ unpaid bill and oversee collection.

In most instances, the patient was a plaintiff in an accident case, where the patient was represented by an attorney.

Typically, the defendant (and/or the insurance company of the defendant) in the accident case would pay the patient’s bill upon settlement or final judgment of the accident case.

The payment to us was made through the attorney of the patient.

In most cases, it was required that we agree to the settlement price and the patient must sign off on the settlement.

Once we were paid, the patient’s attorney would receive payment for his or her legal fee.

During the fourth quarter of 2018, the decision was made to discontinue our involvement in future medical procedures due to our cash position, and we have not been involved in any procedures since then, including in 2021 or 2020.

Presently, we continue to have no plans to do so in the future.

However, we continue to actively pursue the collection of previously funded procedures.

Without additional funding, there is no guarantee that we can continue as a going concern.

We own a patented device and process by which a video recording system is attached to a fluoroscopic x-ray machine, the “four camera technology,” which we believe can attract additional physicians and patients as well as provide us with additional revenue streams with our new programs designed to assist in treatment documentation.

We have refined the technology, through research and development, resulting in a fully commercialized Quad Video Halo System 3.0 (“QVH”).

Using this technology, diagnostic and treatment procedures are recorded from four separate video feeds that capture views from both inside and outside the body, and a video is made which is given to the patient’s representative to verify the treatment received.

In September 2014, we created a wholly owned subsidiary, Quad Video Halo, Inc.

The purpose of this entity is to hold certain company assets affiliated with the QVH units.

We own a device and process by which a video recording system known as the Quad Video Halo (“QVH”) is used to record medical procedures.

The QVH system can simultaneously capture views and machine images, thus providing a record of internal and external views of a recorded procedure.

The QVH system has been refined and improved over the years.

The first- and second-generation systems required post-procedure file transfers, synchronizing and editing.

This involved considerable software and time for a videographer to produce a complete video.

The latest generation of the QVH referred to as NextGen 2.0 completely eliminates all of the issues associated with prior QVH approaches.

The new varifocal lens cameras allow ceiling placement which eliminates the impact of room clutter and fluoroscope movement.

The system server automatically synchronizes and renders the final videos, thus eliminating all backend processing.

We lease QVH units to customers who pay us monthly lease payments.

Presently, the majority of our total revenues are derived from these lease payments.

Our wholly-owned subsidiary, Quad Video Halo, Inc.

holds certain company assets affiliated with the QVH units.

Billing and Operations

We work with independent medical contractors who perform the medical services for patients and bill a fixed fee for the services.

Historically, we funded certain spine injury diagnostic centers where we work with healthcare providers as independent contractors to perform medical services for patients (although we discontinue funding future medical procedures during the fourth quarter of 2018—see above).

We pay the healthcare providers for medical services performed.

The patients are billed based on Current Procedural Terminology (“CPT”) codes for the medical procedure performed.

From 2009 to 2018, we worked with independent medical contractors who would perform the medical services for patients and bill a fixed fee for the services.

We funded certain spine injury diagnostic centers where we work with healthcare providers as independent contractors to perform medical services for patients (however, we discontinued our involvement in future medical procedures during the fourth quarter of 2018—see above).

We paid the healthcare providers for medical services performed.

The patients were billed based on Current Procedural Terminology (“CPT”) codes for the medical procedure performed.

CPT codes are numbers assigned to every task and service a medical practitioner may provide to a patient including medical, surgical and diagnostic services.

CPT codes are developed, maintained and copyrighted by the American Medical Association.

Patients are billed at the normal billing amount, based on national averages, for a particular CPT code procedure.

We take control of the patients’ unpaid bills.

The clinic facilities where our spine injury diagnostic centers operate are owned or leased by a medical affiliate or third party.

We have no ownership interest in these clinic facilities, nor do we have any responsibilities towards building or operating the clinic facilities.

Direct contact with key spine surgeons, orthopedic surgeons and other healthcare providers who are highly visible in their communities is an important step in targeting appropriate referral sources.

Additional marketing to spine surgeons is done at national medical meetings and trade shows.

Patients were billed at the normal billing amount, based on national averages, for a particular CPT code procedure.

We would take control of the patients’ unpaid bills.

The clinic facilities where our spine injury diagnostic centers operated were owned or leased by a medical affiliate or third party.

We had no ownership interest in these clinic facilities, nor did we have any responsibilities towards building or operating the clinic facilities.

Governmental Regulation

All of the medical diagnostic procedures offered at the clinics are performed by independent medical contractors, who are subject to regulation by a number of governmental entities at the federal, state, and local levels.

We are subject to laws and regulations relating to business corporations in general.

In recent years, Congress and state legislatures have introduced an increasing number of proposals to make significant changes in the healthcare system.

Changes in law and regulatory interpretations could reduce our revenue and profitability.

Corporate Practice of Medicine and Other Laws

We are not licensed to practice medicine.

Most states in which our business operates or in which we anticipate it will operate, limits the practice of medicine to licensed individuals or professional organizations comprised of licensed individuals.

Business corporations generally may not exercise control over the medical decisions of physicians.

Many states also limit the scope of business relationships between business entities and medical professionals, particularly with respect to fee splitting.

Most state fee-splitting laws only prohibit a physician from sharing medical fees with a referral source, but some states have interpreted certain management agreements between business entities and physicians as unlawful fee-splitting.

Statutes and regulations relating to the practice of medicine, fee-splitting, and similar issues vary widely from state to state.

Because these laws are often vague, their application is frequently dependent on court rulings and attorney general opinions.

There are many states that permit the corporate practice of medicine, and we are exploring opportunities in these states.

Under the affiliate doctor agreements, the doctors retain sole responsibility for all medical decisions, developing operating policies and procedures, implementing professional standards and controls, and maintaining malpractice insurance.

We attempt to structure all our health services operations, including arrangements with our doctors, to comply with applicable state statutes regarding corporate practice of medicine, fee-splitting, and similar issues.

However, there can be no assurance:

that private parties, courts or governmental officials with the power to interpret or enforce these laws and regulations, will not assert that we are in violation of such laws and regulations;

that future interpretations of such laws and regulations will not require us to modify the structure and organization of our business;

that any such enforcement action, which could subject us and our affiliated professional groups to penalties or restructuring or reorganization of our business, will not adversely affect our business or results of operations.

All of the medical diagnostic procedures offered at the clinics were performed by independent medical contractors, who were subject to regulation by a number of governmental entities at the federal, state, and local levels.

We were and are subject to laws and regulations relating to business corporations in general.

HIPAA Administrative Simplification Provisions — Patient Privacy and Security

29 unchanged sentences

We regularly monitor the privacy and confidentiality requirements that relate to our business, and we anticipate that we may have to modify our operating practices and procedures in order to comply with these requirements.

Environmental

Although we currently contract with independent contractor medical providers, who are responsible for compliance with environmental laws, our operations may be subject to various federal, state, and local laws and regulations relating to the protection of human health and the environment, including those governing the management and disposal of infectious medical waste and other waste generated and the cleanup of contamination.

If an environmental regulatory agency finds any of our facilities to be in violation of environmental laws, penalties and fines may be imposed for each day of violation and the affected facility could be forced to cease operations.

The responsible party could also incur other significant costs, such as cleanup costs or claims by third parties, as a result of violations of, or liabilities under, environmental laws.

Although we believe that our independent medical providers’ environmental practices, including waste handling and disposal practices, will be in material compliance with applicable laws, future claims or violations, or changes in environmental laws could have an adverse effect on our business.

The market to provide healthcare pain diagnostic services is highly competitive and fragmented.

Our primary competitors are typically independent physicians, chiropractors, hospital emergency departments, and hospital-owned or hospital-affiliated medical facilities.

As managed care techniques continue to gain acceptance in the automobile accident marketplace, we believe that our competitors will increasingly consist of nationally-focused care management service companies providing their service to insurance companies and litigation defense experts.

Because the barriers to entry in our geographic markets have a low threshold and our diagnostic centers’ patients have the flexibility to move easily to new healthcare service providers, the addition of new competitors may occur relatively quickly.

Some of our affiliated physicians and other healthcare providers may elect to compete with us by offering their own products and services to patients.

If competition within our industry intensifies, our ability to assist patients or associated physicians, or maintain or increase our revenue growth, price flexibility and control over medical costs, trends, and marketing expenses, may be compromised.

In order to mitigate the effects of intensifying competition, we will make careful study of population trends and demographic growth patterns in determining the best locations to compete.

Moreover, we will endeavor to have all of our physicians under strict contract to avoid unnecessary attrition and loss of skilled personnel.

We currently have one paid full time employee, plus one collection consultant and one QVH consultant at our corporate headquarters.

We expect to continue to use independent contractors, consultants, attorneys and accountants as necessary, to complement services rendered by our employee.

Presently, the majority of our total revenues are derived from leasing QVH units.

Although we believe the QVH system is unique in the healthcare industry, there may be low barriers to entry in this market, and the addition of new competitors may occur relatively quickly.

If competition within our industry intensifies, our ability to maintain or increase our revenue growth, price flexibility and control over medical costs, trends, and marketing expenses, may be compromised.

We currently have one paid part-time employee (our CFO, John Bergeron), plus one collection consultant and one QVH consultant at our corporate headquarters.

We do not presently pay our President and CEO, William Donovan, M.D., any compensation.

We expect to continue to use independent contractors, consultants, attorneys and accountants as necessary, to complement services rendered by our employees.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business