Proweh Health Systems, Inc. (the “Company” ... pronounced “Pro-way”) is a Florida Corporation, formed in 1995, for the purpose of producing the “next generation of health care delivery”.

      Proweh Health Systems has designed its delivery system using an improved and unique Medical Savings Account based application that provides a competitive and proprietary advantage over other delivery systems and other MSA competitors.

      Independent market research has disclosed a huge pent-up consumer demand for Medical Savings Accounts (MSAs) among all classes of employers and employees. PHS’ proprietary “MSA Plus” product-line has been designed to fulfill all such MSA demand. Proweh Health Systems' management now seeks to raise $5,000,000 in additional working capital for the national introduction of its MSA Plus Product line.

Background - The Problem

      A well known problem exists in today’s Health Care Delivery System. The management of America’s health care has been left to those who finance the cost of health care (insurers) and not to those who provide or use health care services. This has, quite naturally, led to progressively more control over the delivery of health care services by “first generation” Managed Care Organizations (MCOs) through their control of distribution channels.

      Increasingly, Insurer-Based Managed Care seeks to exercise complete control over the delivery of health care services. Over the past fifteen years, the cost of the delivery of health care has been compounded by Managed Care’s commingling of its expensive overhead and the complications and regulations of insurance ... with the fundamental simplicity of health care delivery.

      The current Health Care System authorizes the continued under-payment to health care providers, and is threatening the system’s ability to maintain quality health care. This “threat to quality” is the primary problem in the system today since most real inefficiencies in the “System” (i.e., caused by physicians and hospitals) have been already identified and eliminated. PHS seeks to break this pattern through the use of its more cost-effective health care operating systems; thereby producing an economic environment in which health insurance premiums will fall, while net consumer benefits and payments to health care providers stabilize or increase.

      The Company has completed the design, development and test marketing of an alternative delivery system (referred to as a “Patient-Based Delivery System”) which allows providers to benefit from the control and direct-ability of patient revenues without the need for them to become insurers or hold risk. In the process, a Patient- Based Delivery System seeks to eliminate the adverse side-effects caused by existing Managed Care HMO and PPO product-lines.

The Solution - MSA Plus

      Clearly, Americans are demanding a more cost-effective and convenient way in which to finance their purchase of health care services and MSAs represent such an alternative. With the passage of H.R. 3103, demand for MSA products will continue to grow as both banks and insurers advertise their new “qualified” MSA product-lines, (even though limited at this time by legislation to 750,000 employees over four years).

      The time for a more cost-effective operating model related to the delivery of health care has arrived. As Insurer-Based Managed Care’s abuses continue to escalate, consumers and physicians are “hungry” for product leadership that will increase a consumer’s Health Care Value by delivering economy and benefit.

      PHS’s proprietary “MSA Plus” product-line has been designed to fulfill all such demand with an improved and truely unique MSA application that provides an enormous competitive and proprietary advantage over other MSA competitors.

The Consumer's Solution

      PHS’s solution, the “MSA Plus” Product, will help solve the “Crisis” in America’s Health Care by increasing a consumer’s Health Care Value (Value = Quality / Cost). MSA Plus “un-bundles” directability of patient revenues from the expense and complications of existing Managed Care Plans. The by-product creates a substantial and sustainable “Pricing Advantage” over Managed Care product lines (HMO, POS and PPO). This “Pricing Advantage” is used to reduce the cost while protecting the quality of health care and its delivery.

The Provider’s Solution

      MSA Plus reduces the cost to finance the purchase of future health care services (premiums) without further reduction in the payments available to provide for quality health care services, while preserving the physician-patient relationship ... unabridged by a change of insurer or employer. MSA Plus empowers physicians to deliver cost-effective and quality care via “fee-for-service” contracts, enabling community physicians to participate in a national health care solution without assuming “risk”.

      PHS Management believes that its unique MSA application will be embraced by many existing Health Care Systems (IPAs, PHOs, MSOs, Multi-Specialty Groups, etc.) as a new tool (to be used in conjunction with current methodology) for the purpose of consolidating a purchasing group of health care consumers. This will create “brand name” recognition for providers in a cost-effective manner, without the need for providers to commingle their assets, lose local autonomy, become insurers or hold “insurable risk” through complex capitated payment schemes. In this manner, PHS and its MSA Plus product-line can unite both physicians and consumers in a common cause of increasing the consumer’s health care value.

The Opportunity

      In 1995, before the passage of the Kennedy/Kassebaum bill (H.R. 3103), the Blue Cross and Blue Shield Association funded an employer and employee survey which disclosed a huge pent-up consumer demand for Medical Savings Accounts (MSAs) among all classes of employers and employees. “Research by the national Blue Cross and Blue Shield Association has revealed that 43% of employees would ‘definitely or probably’ switch to a Medical Savings Account if it were offered ... 20% of all employers would be ‘very interested’ in providing MSAs as their exclusive benefit program ... another 47% of employers would either be ‘mildly interested’ in providing it exclusively, or would offer it as an option to their employees.” (Patient Power Report 3/16/96)

      It is PHS’s belief that its MSA Plus product-line will accumulate a 4% or greater market share by tapping the existing demand ($500 Billion) for an increased Health Care Value which has been validated by the passage of the Kennedy/Kassebaum legislation. It is this “window of opportunity” that government legislation has created that stimulates PHS to seek additional capital at this time!

Marketing

      PHS intends to initiate MSA Plus sales regionally in 1997 and expand its market reach to encompass the US during the following four years. PHS will offer MSA Plus to all sizes of businesses as either a qualified or non-qualified MSA application.

      PHS intends to finance the penetration of the national market for MSA Plus through the creation of a development and marketing entity called a "Market Development Program” (MDP) within each of 35 geographic regions encompassing the continental United States. Each MDP will be capitalized with funds from investors in amounts projected by PHS as sufficient to assemble within its region a provider network, a retail sales organization, and a mass marketing and advertising campaign supporting retail sales. The combination of the MDPs and MSA Plus will create a unique distribution and retail product-line encompassing the United States.

Market Size

      The Kennedy/Kassebaum legislation reflects an estimated demand by 40,000,000 employees for MSA products. PHS Management believes that the 40,000,000 employees which qualified MSAs can not service over the next four years will substantially benefit PHS. Management further believes employers and employees will recognize MSA Plus as a Health Care Value and purchase same because MSA Plus promotes a “Use it or Keep it” health care solution which benefits 100% of the employer’s employees and dependents, instead of just the unhealthy insureds (typically 20%) served by Insurer-Based Managed Care’s “Use it or Lose it” methodology.

      PHS will serve this large market segment (50% or more of the US population) through more cost-effective use of “discount revenues” provided by physicians and hospitals. These discount revenues are available to the Company in exchange for its delivery of patients and the directability of their revenues, which it accesses through financing arrangements and are processed through normal banking transactions.

      PHS’s Patient-Based solution, MSA Plus, will be propelled into the marketplace by the recent passage of Health Care Reform Laws.

Management

      Proweh has an experienced and seasoned ‘s Executive Management Team which is operational and standing ready to fully implement the Company’s Business Plan. Since 1986, Mr. Wischweh and his team has directed the expenditure of over $7,500,000 to develop and demonstrate the viability of an alternative delivery system for the health care industry and bring the MSA Plus Product forward and ready to market.

Ownership

      Proweh Health Systems, Inc.’s current equity structure consists of 10,000,000 authorized shares of common stock. Issued shares to date amount, in the aggregate, to 7,500,000 shares, being owned by the originators and managers of the Company and several, minority, outside investors.

      Management plans to sell up to 1,000,000 additional shares at $5.00 per share, generating several million additional dollars in working capital for the national introduction of the MSA Plus Product.

      A detailed presentation of Projected Revenues and Profits is available from management.

Investment Opportunity

      The recent consolidations by Insurer-Based Managed Care corporations have been driven by strategies to protect shareholder equity by propping up weakening profits, at the expense of financial resources previously dedicated to procure, provide and maintain quality health care. This strategy consolidates membership which is then used as an adverse “bargaining chip” against health care providers to extract deeper discounts (or lower fees) in an “all or nothing” cash flow “show down”. The recent lackluster performance of MCO stocks clearly mirrors their decline in productivity.

      On the other hand, PHS offers a method by which investors (who may be employers, health care providers, or insurance agents, among others) can protect their position in the health care equation by supporting the distribution and purchase of Patient-Based products such as MSA Plus.

      Proweh Health Systems expects to roll out its carefully conceptualized strategic plan as quickly as possible in the next several quarters and believes it will be positioned for an initial public offering during 1998. This presents an exceptional opportunity for early stage investors to capture a significant equity appreciation as milestones set in this Plan are realized.

      The Owners, Officers and staff of Proweh Health Systems, Inc. invite you to join us in facing the challenges and reaping the rewards as we innovate the "next generation of healthcare delivery" and ...