Alpharetta, Ga.-based First Consulting Group, a provider of healthcare IT consulting and systems implementation and integration, recently announced that its agreement with University of Pennsylvania Health System (UPHS) will not be renewed.
According to FCG, UPHS has decided to discontinue outsourcing the majority of its IT services, choosing instead to build a predominantly in-house IT department.
The expiring contract accounted for $26.7 million in revenues for FCG in 2006, of which $5.3 million was zero-margin, pass-through revenue to Affiliated Computer Services (ACS), FCG's infrastructure subcontractor on the engagement, says FCG.
The future net income impact of the contract expiration to FCG is uncertain at this time, and according to FCG, is dependent upon the level of transition services that UPHS requires and the level of continuing FCG services, if any, that UPHS decides to retain.
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