<PAGE> 1
Securities and Exchange Commission
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): December 14, 1998
FPA Medical Management, Inc.
(Exact name of registrant as specified in its charter)
Delaware 0-24276 33-0604264
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
5835 Blue Lagoon Drive
Miami, FL 33126-2017
(Address of principal executive offices) (Zip Code)
(305) 477-4372
(Registrant's telephone number, including area code)
3636 Nobel Drive
San Diego, CA 92122
(Former name or former address, if changed since last report)
<PAGE> 2
ITEM 5. OTHER EVENTS.
As previously reported on a Current Report on Form 8-K, on July 19, 1998
and various dates thereafter through August 7, 1998, the Registrant and various
of its subsidiaries and affiliates (collectively, the "Debtors") filed for
protection under Chapter 11 in the United States District Court for the District
of Delaware (the "Bankruptcy Court"). The cases have been consolidated for the
purpose of joint administration and have been assigned to Chief United States
Bankruptcy Judge Peter J. Walsh. The consolidated caption is: In re FPA Medical
Management, Inc., et al. Debtors, Case Nos. 98-1596 through 98-1685.
As part of its Reorganization, the Registrant relocated its principal
executive offices to 5835 Blue Lagoon Drive, Miami, Florida 33126-2017.
On December 14, 1998, the Registrant and various of its subsidiaries and
affiliates filed with the United States Bankruptcy Court for the District of
Delaware its monthly operating report for the period from November 2, 1998
through November 27, 1998 (the "MOR"), which is attached hereto as Exhibit
99.1.(1)
- ------------------------
(1) The attachments and exhibits referenced in the MOR are not attached as part
of Exhibit 99.1, but are available at the Office of the United States
Trustee and the Bankruptcy Court. In addition, the Registrant agrees that
it will furnish a copy of any omitted schedule or similar attachment to the
Commission upon its request.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits
99.1 Monthly Operating Report for the period from November 2, 1998
through November 27, 1998.
2
<PAGE> 3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
FPA MEDICAL MANAGEMENT, INC.
By: /s/ Stephen J. Dresnick
Date: December 28, 1998 ------------------------------------
Stephen J. Dresnick
Chairman and Chief Executive Officer
3
<PAGE> 4
EXHIBIT INDEX
Number Exhibit
- ------ -------
99.1 Monthly Operating Report for the period from November 2, 1998
through November 27, 1998.
4
<PAGE> 1
Exhibit 99.1
Debtor: FPA MEDICAL MANAGEMENT, INC.
- -------
Case Number: 98-01596PJW through 98-01685PJW
- ----------------------------------------------
Notes to Monthly Operating Report for the period November 2, 1998 through
November 27, 1998, "Required Attachments":
1. Depository Tax Receipts for payroll tax deposits into tax trust accounts are
included for the month of November.
2. Copies of most of the Debtors' bank statements for the month of November are
attached; copies of the balance of the November statements not yet received from
the Banks and/or Debtors will be forwarded upon receipt. In addition, copies of
unsubmitted Debtors' bank statements in the prior period for the month of
October are attached.
3. The Debtors' most recently filed Income Tax Return was included in a prior
period (July 19-August 28, 1998) filing with the Office of the United States
Trustee.
4. The Debtors' most recent Annual Financial Statements prepared by Accountant
were included in a prior period (July 19-August 28, 1998) filing with the Office
of the United States Trustee.
<PAGE> 2
FPA MEDICAL MANAGEMENT, INC.
MATRIX OF REQUIRED ATTACHMENTS / BANK STATEMENTS
<TABLE>
<CAPTION>
NOVEMBER BANK OCTOBER BANK
DEBTORS STATEMENTS STATEMENTS COMMENTS
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Core Business Units:
Sterling Healthcare Group, Inc. X
California Axminster X
San Antonio (Gonzaba) X
Meridian
Florida Humana & Clinics X
Health Partners Inc. X
Non-Core Business Units
Orange Coast
North Carolina X
Illinois MSO X
Kansas City
</TABLE>
<PAGE> 3
FPA MEDICAL MANAGEMENT, INC.
DIP Budget
DIP Projected vs. Actual Cash Flows
November 2, 1998 through November 27, 1998
<TABLE>
<CAPTION>
For the Period 11/2/98 to 11/27/98
---------------------------------------------------------
Projected (1) Actual (1) Difference
A B C=B-A
------------- ------------ ----------
<S> <C> <C> <C>
INITIAL CASH BALANCE $ 1,134,611 $ 1,134,612 1
Cash Receipts:
Fee For Service Billings $14,695,157 $13,297,736 (1,397,421)
Claims & Capitation $10,491,430 $10,574,502 83,072
Reimbursement $ 50,000 $ 107,839 57,839
Medicare & Collections $ 1,200,000 $ 1,904,538 704,538
----------- ----------- ---------
TOTAL CASH RECEIPTS $26,436,587 $25,884,615 (551,972)
Less: Cash Disbursements:
Employee & Physician Payroll $19,759,394 $19,870,224 110,830
Catch-up payments to Doctors $ -- $ -- --
Insurance $ 1,731,000 $ 1,561,867 (169,133)
Claims & Capitation $ 1,906,500 $ 1,408,594 (497,906)
Patient Refunds $ 211,000 $ 127,716 (83,284)
Rent $ 181,500 $ 107,736 (73,764)
Utilities $ 372,802 $ 463,225 90,423
Bank Lock-Box Account Fees $ -- $ -- --
Medical Supplies $ 460,500 $ 420,780 (39,720)
Other $ 2,860,944 $ 2,928,636 67,692
----------- ----------- ---------
Total Cash Disbursements $27,483,640 $26,888,778 (594,862)
Net Cash Flow $(1,047,053) $(1,004,163) 42,890
Financing Charges (2) $ (282,000) $ (282,624) (624)
Retention Costs (2) $ (850,000) $ (778,061) 71,939
Utility Company Deposits $ (700,000) $ (183,330) 516,670
Stop Loss Insurance (2) $ -- $ -- --
Professional Fees (2) $(2,853,000) $(1,796,709) 1,056,291
Borrowing from/(Repayment to) HPI $ (600,000) $ (600,000) --
Capital Expenditures (2) $ -- $ -- --
Restructuring Expenses $ -- $ (277,093) (277,093)
First Union CD Deposit $(1,000,000) $ -- 1,000,000
Restricted AWS Cash $ -- $ -- --
A/R Turnover from Collection $ 200,000 $ 25,592 (174,408)
Orange Coast Transaction Fees $ (293,750) $ (95,861) 197,889
Orange Coast Liabilities $ -- $ (32,087) (32,087)
Other Collections $ -- $ 150,000 150,000
Orange Coast Post-Sale Disbursements $ (100,000) $ -- 100,000
DIP Loan Borrowing/(Repayment) $ 6,391,192 $ 6,350,000 (41,192)
Orange Coast DIP Re-Borrowing $ -- $ 50,000 50,000
ENDING CASH BALANCE $ -- $ 2,660,276 2,660,276
----------- ----------- ---------
</TABLE>
1) The projected data reflected herein is based upon the Final DIP Budget
submitted to the Court on July 20, 1998, as amended on November 16, 1998. The
actual data reflected herein is based upon the actual data reported to the Bank
Group in the Weekly Cash Reports.
2) Amounts for Financing Charges, Retention Costs, Stop Loss Insurance,
Professional Fees and Capital Expenditures are generally reflected at the FPA
Corporate level only. Additionally, Intercompany transfers occurring between the
Sterling Healthcare Group, Inc. and FPA Corporate are not separately reflected
herein.
<PAGE> 4
STERLING HEALTHCARE GROUP, INC.
DIP Budget
DIP Projected vs. Actual Cash Flows
November 2, 1998 through November 27, 1998
<TABLE>
<CAPTION>
For the Period 11/2/98 to 11/27/98
------------------------------------------------------
Projected Actual Difference
A B C=B-A
------------- ----------- ----------
<S> <C> <C> <C>
INITIAL CASH BALANCE $ 576,655 $ 576,655 (0)
Cash Receipts:
Fee For Service Billings $12,800,000 $11,335,711 (1,464,289)
Claims & Capitation $ -- $ -- --
Reimbursement $ -- $ -- --
Medicare & Collections $ 1,200,000 $ 1,904,538 704,538
----------- ----------- ---------
TOTAL CASH RECEIPTS $14,000,000 $13,240,249 (759,751)
Less: Cash Disbursements:
Employee & Physician Payroll $12,010,394 $11,934,710 (75,684)
Catch-up payments to Doctors $ -- $ -- --
Insurance $ 539,000 $ 215,144 (323,856)
Claims & Capitation $ -- $ -- --
Patient Refunds $ 211,000 $ 118,774 (92,226)
Rent $ -- $ 20,252 20,252
Utilities $ 36,000 $ 28,616 (7,384)
Bank Lock Box $ -- $ -- --
Medical Supply $ -- $ 2,844 2,844
Other $ 1,775,594 $ 1,407,860 (367,734)
----------- ----------- ---------
Total Cash Disbursements $14,571,988 $13,728,200 (843,788)
Financing Charges $ -- $ -- --
Net DIP Advance $ -- $ -- --
Net Cash Flow $ (571,988) $ (487,951) 84,037
Intercompany Transfers $ -- $ 1,742,826 1,742,826
ENDING CASH BALANCE $ 4,667 $ 1,831,530 1,826,863
----------- ----------- ---------
</TABLE>
<PAGE> 5
CALIFORNIA (AXMINSTER)
DIP Budget
DIP Projected vs. Actual Cash Flows
November 2, 1998 through November 27, 1998
<TABLE>
<CAPTION>
For the Period 11/2/98 to 11/27/98
--------------------------------------------------
Projected Actual Difference
A B C=B-A
------------- ----------- ----------
<S> <C> <C> <C>
INITIAL CASH BALANCE $ 40,514 $ 40,515 1
Cash Receipts:
Fee For Service Billings $ 60,000 $ 54,558 (5,442)
Claims & Capitation $ 260,000 $831,490 571,490
Reimbursement $ -- $ -- --
Medicare & Collections $ -- $ -- --
---------- -------- ---------
TOTAL CASH RECEIPTS $ 320,000 $886,048 566,048
Less: Cash Disbursements:
Employee & Physician Payroll $ 400,000 $386,844 (13,156)
Catch-up payments to Doctors $ -- $ -- --
Insurance $ -- $ -- --
Claims & Capitation $ 512,500 $209,860 (302,640)
Patient Refunds $ -- $ -- --
Rent $ 55,000 $ 6,588 (48,412)
Utilities $ 9,000 $ 21,250 12,250
Bank Lock Box $ -- $ -- --
Medical Supply $ 15,000 $ 17,006 2,006
Other $ 13,600 $ 31,644 18,044
---------- -------- ---------
Total Cash Disbursements $1,005,100 $673,192 (331,908)
Agreed Cash Adjustments $ -- $ -- --
Less: Interest $ -- $ -- --
Net Cash Flow $ (685,100) $212,856 897,956
Intercompany Transfers $ -- $527,355 527,355
ENDING CASH BALANCE $ (644,586) $780,726 1,425,312
---------- -------- ---------
</TABLE>
<PAGE> 6
CORNERSTONE
DIP Budget
DIP Projected vs. Actual Cash Flows
November 2, 1998 through November 27, 1998
<TABLE>
<CAPTION>
For the Period 11/2/98 to 11/27/98
--------------------------------------------------
Projected Actual Difference
A B C=B-A
------------- ----------- ----------
<S> <C> <C> <C>
INITIAL CASH BALANCE $ (0) $ -- 0
Cash Receipts:
Fee For Service Billings $150,000 $122,601 (27,399)
Claims & Capitation $ -- $ -- --
Reimbursement $ -- $ -- --
Medicare & Collections $ -- $ -- --
-------- -------- ------
TOTAL CASH RECEIPTS $150,000 $122,601 (27,399)
Less: Cash Disbursements:
Employee & Physician Payroll $120,000 $122,021 2,021
Catch-up payments to Doctors $ -- $ -- --
Insurance $ -- $ 3,441 3,441
Claims & Capitation $ -- $ -- --
Patient Refunds $ -- $ -- --
Rent $ 16,500 $ 21,632 5,132
Utilities $ 6,500 $ 1,027 (5,473)
Bank Lock Box $ -- $ -- --
Medical Supply $ -- $ -- --
Other $ 40,000 $ 25,348 (14,652)
-------- -------- ------
Total Cash Disbursements $183,000 $173,469 (9,531)
Agreed Cash Adjustments $ -- $ -- --
Less: Interest $ -- $ -- --
Net Cash Flow $(33,000) $(50,868) (17,868)
Intercompany Transfers $ -- $ 50,868 50,868
ENDING CASH BALANCE $(33,000) $ -- 33,000
-------- -------- ------
</TABLE>
<PAGE> 7
FLORIDA (CLINICS & HUMANA)
DIP Budget
DIP Projected vs. Actual Cash Flows
November 2, 1998 through November 27, 1998
<TABLE>
<CAPTION>
For the Period 11/2/98 to 11/27/98
--------------------------------------------------
Projected Actual Difference
A B C=B-A
------------- ----------- ----------
<S> <C> <C> <C>
INITIAL CASH BALANCE $ -- $ -- --
Cash Receipts:
Fee For Service Billings $ 752,027 $ 824,166 72,139
Claims & Capitation $2,370,530 $ 2,474,591 104,061
Reimbursement $ -- $ -- --
Medicare & Collections $ -- $ -- --
---------- ----------- -------
TOTAL CASH RECEIPTS $3,122,557 $ 3,298,757 176,200
Less: Cash Disbursements:
Employee & Physician Payroll $2,200,000 $ 2,395,252 195,252
Catch-up payments to Doctors $ -- $ -- --
Insurance $ -- $ 186,742 186,742
Claims & Capitation $ -- $ -- --
Patient Refunds $ -- $ 3,824 3,824
Rent $ -- $ 11,399 11,399
Utilities $ 200,000 $ 174,372 (25,628)
Bank Lock Box $ -- $ -- --
Medical Supply $ 100,000 $ 101,348 1,348
Other $ 400,000 $ 354,854 (45,146)
---------- ----------- -------
Total Cash Disbursements $2,900,000 $ 3,227,791 327,791
Agreed Cash Adjustments $ -- $ -- --
Less: Interest $ -- $ -- --
Net Cash Flow $ 222,557 $ 70,966 (151,591)
Intercompany Transfers $ -- $ (70,966) (70,966)
ENDING CASH BALANCE $ 222,557 $ -- (222,557)
---------- ----------- -------
</TABLE>
<PAGE> 8
MERIDIAN
DIP Budget
DIP Projected vs. Actual Cash Flows
November 2, 1998 through November 27, 1998
<TABLE>
<CAPTION>
For the Period 11/2/98 to 11/27/98
----------------------------------------------------
Projected Actual Difference
A B C=B-A
------------- ----------- ----------
<S> <C> <C> <C>
INITIAL CASH BALANCE $ 272,382 $ 272,382 --
Cash Receipts:
Fee For Service Billings $ 380,000 $ 407,793 27,793
Claims & Capitation $2,770,549 $ 2,465,859 (304,690)
Reimbursement $ -- $ 52,798 52,798
Medicare & Collections $ -- $ -- --
---------- ----------- -------
TOTAL CASH RECEIPTS $3,150,549 $ 2,926,450 (224,099)
Less: Cash Disbursements:
Employee & Physician Payroll $1,670,000 $ 1,563,883 (106,117)
Catch-up payments to Doctors $ -- $ -- --
Insurance $ -- $ 120,022 120,022
Claims & Capitation $ 950,000 $ 1,017,859 67,859
Patient Refunds $ -- $ -- --
Rent $ -- $ 4,013 4,013
Utilities $ 25,000 $ 70,547 45,547
Medical Supply $ 120,000 $ 152,332 32,332
Other $ 300,000 $ 319,632 19,632
---------- ----------- -------
Total Cash Disbursements $3,065,000 $ 3,248,288 183,288
Agreed Cash Adjustments $ -- $ -- --
Less: Interest $ -- $ -- --
Net Cash Flow $ 85,549 $ (321,838) (407,387)
Intercompany Transfers $ -- $ 84,163 84,163
ENDING CASH BALANCE $ 357,931 $ 34,707 (323,224)
---------- ----------- -------
</TABLE>
<PAGE> 9
SAN ANTONIO (GONZABA)
DIP Budget
DIP Projected vs. Actual Cash Flows
November 2, 1998 through November 27, 1998
<TABLE>
<CAPTION>
For the Period 11/2/98 to 11/27/98
----------------------------------------------------
Projected Actual Difference
A B C=B-A
------------- ----------- ----------
<S> <C> <C> <C>
INITIAL CASH BALANCE $ 0 $ -- (0)
Cash Receipts:
Fee For Service Billings $ 100,000 $ 42,346 (57,654)
Claims & Capitation $1,765,000 $1,487,459 (277,541)
Reimbursement $ -- $ -- --
Medicare & Collections $ -- $ -- --
---------- ---------- ---------
TOTAL CASH RECEIPTS $1,865,000 $1,529,805 (335,195)
Less: Cash Disbursements:
Employee & Physician Payroll $1,320,000 $1,390,294 70,294
Catch-up payments to Doctors $ -- $ -- --
Insurance $ 16,000 $ 31,046 15,046
Claims & Capitation $ 270,000 $ 34,330 (235,670)
Patient Refunds $ -- $ 5,113 5,113
Rent $ 33,000 $ 23,840 (9,160)
Utilities $ 42,000 $ 88,625 46,625
Bank Lock Box $ -- $ -- --
Medical Supply $ 175,000 $ 130,640 (44,360)
Other $ 41,500 $ 364,790 323,290
---------- ---------- ---------
Total Cash Disbursements $1,897,500 $2,068,678 $ 171,178
Financing Charges $ -- $ -- --
Net DIP Advance $ -- $ -- --
Net Cash Flow $ (32,500) $ (538,873) (506,373)
Intercompany Transfers $ -- $ 538,873 538,873
ENDING CASH BALANCE $ (32,500) $ -- $ 32,500
---------- ---------- ---------
</TABLE>
<PAGE> 10
TENTATIVES & CLOSURES
DIP Budget
DIP Projected vs. Actual Cash Flows
November 2, 1998 through November 27, 1998
<TABLE>
<CAPTION>
For the Period 11/2/98 to 11/27/98
----------------------------------------------------
Projected Actual Difference
A B C=B-A
------------- ---------- ----------
<S> <C> <C> <C>
INITIAL CASH BALANCE $ 245,060 $ 245,060 0
Cash Receipts:
Fee For Service Billings $ 453,130 $ 510,561 57,431
Claims & Capitation 3,325,351 $3,315,103 (10,248)
Reimbursement $ 50,000 $ 55,041 5,041
Medicare & Collections $ -- $ -- --
---------- ---------- -------
TOTAL CASH RECEIPTS $3,828,481 $3,880,705 52,224
Less: Cash Disbursements:
Employee & Physician Payroll $2,039,000 $2,077,220 38,220
Catch-up payments to Doctors $ -- $ -- --
Insurance $1,176,000 $1,005,472 (170,528)
Claims & Capitation $ 174,000 $ 146,545 (27,455)
Patient Refunds $ -- $ 5 5
Rent $ 77,000 $ 20,012 (56,988)
Utilities $ 54,302 $ 78,788 24,486
Bank Lock Box $ -- $ -- --
Medical Supply $ 50,500 $ 16,610 (33,890)
Other $ 290,250 $ 424,508 134,258
---------- ---------- -------
Total Cash Disbursements $3,861,052 $3,769,160 (91,892)
Agreed Cash Adjustments $ -- $ -- --
Less: Interest $ -- $ -- --
Net Cash Flow $ (32,571) $ 111,545 144,116
Intercompany Transfers $ -- $ (343,292) (343,292)
ENDING CASH BALANCE $ 212,489 $ 13,313 (199,176)
---------- ---------- -------
</TABLE>
Source: Information reflected above was obtained from the
books and records of FPA Medical Management, Inc.
<PAGE> 11
HEALTH PARTNERS, INC
DIP Budget
DIP Projected vs. Actual Cash Flows
November 2, 1998 through November 27, 1998
<TABLE>
<CAPTION>
For the Period 11/2/98 to 11/27/98
----------------------------------------------------
Projected Actual Difference
A B C=B-A
------------- ---------- ----------
<S> <C> <C> <C>
INITIAL CASH BALANCE $ 1,899,872 $1,899,872 $ --
Cash Receipts:
Fee For Service Billings $ 2,868,280 $2,987,684 $ 119,404
Claims & Capitation $ 3,474,228 $3,482,987 $ 8,759
Reimbursement $ -- $ -- $ --
Medicare & Collections $ -- $ -- $ --
----------- ---------- -----------
TOTAL CASH RECEIPTS $ 6,342,508 $6,470,671 $ 128,163
Less: Cash Disbursements:
Employee & Physician Payroll $ 2,852,000 $2,586,367 $ (265,633)
Catch-up payments to Doctors $ 190,000 $ 182,928 $ (7,072)
Insurance $ 210,000 $ 103,959 $ (106,041)
Claims & Capitation $ 2,890,000 $1,894,278 $ (995,722)
Patient Refunds $ 8,000 $ 13,225 $ 5,225
Rent $ 285,630 $ 285,461 $ (169)
Utilities $ 70,000 $ 56,155 $ (13,845)
Medical Supply $ 170,000 $ 175,457 $ 5,457
Other $ 900,000 $ 756,505 $ (143,495)
----------- ---------- -----------
Total Cash Disbursements $ 7,575,630 $6,054,335 $(1,521,295)
Agreed Cash Adjustments $ -- $ -- $ --
Less: Interest $ -- $ (353) $ (353)
Net Cash Flow $(1,233,122) $ 416,689 $ 1,649,811
Intercompany Transfers $ 600,000 $ 600,000 $ --
ENDING CASH BALANCE $ 1,266,750 $2,916,561 $ 1,649,811
----------- ---------- -----------
</TABLE>
GENERAL: HEALTH PARTNERS INC. IS REPORTED FOR CASH FLOW PURPOSES AS A STAND
ALONE ENTITY. THESE TRANSACTIONS ARE NOT INCLUDED AS A PART OF THE FPA MEDICAL
MANAGEMENT, INC. ROLL-UP.
