Mighty, it's not going to 50 years,

Years ago, when I started all we used were [2007-07-13]
hand controls. Haven't seen any in years, but I would assume they still make them.

Mighty, it's not going to 50 years, [2006-07-06]
think it is more like 5 to 10 years.According tothis report,India already has 45% of our jobs, and what about Ireland, and most likely other countries have a finger in the MT pie....and with our government encouraging outsourcing, well, the writing is on the wall, that's for sure. Also I wish someone tell Mr. Dumaguin thatwe aretranscriptionists, nottranscribers....but he's got the money, guess he can say whatever he pleases.

Management? [2008-10-29]
I've been in this a good long while too and hear what you are saying about organizing. Many of us believe there has to be a better way. Oneparadox in the MT-landthat has always puzzled me in the 10 or so places I worked: Why does any promotion from within a company result in less pay? I am a highly efficient producer of quality, so I have often been targeted for management, proofing, QA type positions, only to need to turn them down when I learn it involves at least a$5/hr pay CUT! I suppose the plus side is not having the pressure of production, but does this mean all the slowest, least efficient producers are in the lead positions? This is one of many things that does not make sense in the MT industry. How can we sell the value of what we do? What magic PR would work? The bottom line is companies and hospitals need to cut corners, but if we could somehow convince them the corners they are cutting could be patient lives based on documentation errors, that would be key. We all have a stake in the nationwide shortage of MTs currently pegged at 40,000 and HIM supervisors pegged at 10,000. Yet under current conditions of wages literally staying the same for the past decade despite credentialing, continuing education, and high quality, I think it will take a huge top-down or bottom up approach toenforce nationwide standards that really include MTs at the table. Part of the problem is way bigger than us--the fragmented nature of healthcare in the US in general, and health documentation specifically. Can you imagine if every hospital, clinic and MT company had the same QA standards? Used the same IT network?Literally every place I have worked has a different system for QA, a different software platform, a different judge of what is adequate. I am considering education inHIM because I want to: 1)Earn more and collaborate with others to solve problems, 2) Use my years of experience as an MT to benefit other MTs, 3) Not throw the baby out with the bathwater by neglecting years of education and proficiency in order to become a waitress and earn more in tips than I can transcribing my fingers to the bone! There has to be some value in our collectiveexperience, and I have tried to support AHDI but with the down-spiraling economy, I cannot afford to renew my membership this year and will be paying off my state AHDI convention costs on my credit card for the next year. There has to be a better way!!

AMEN, but [2008-10-27]
Wow, you sound just like me. That is the same refrain.... been using it for years. For some bizarre reason, the vast majority of MTs that I know are the wimpiest, most spineless, sniveling, self-effacing, subservient, groveling people on the planet. They will take all kinds of abuse -- verbal, psychological, financial -- from an employer, complain to each other yet kiss the employer's feet: Thank you, thank you, thank you oh great one for being so kind as to give me a job; I don't deserve it, I am not worthy! Of course the above was exaggerated for effect. But you get the picture..... For years I have tried to get the complaining MTs together to walk down to HR en masse. NOPE! One by one they dried up: I need this job! As if they would be fired, even though common sense tells you that no way will they fire an entire group at once. Your/our suggestion is a good one; unfortunately I think it is too late. Our profession is doing the death rattle and has been for a while now. AAMT could have launched a public education campaign aimed at the end-user/consumer -- THE PATIENTS -- but of course they failed. They were too busy taking money from large MT services and bamboozling the rank-and-file MTs -- taking our $130 per year while educating us. They sold us out. If the emphasis had remained on quality, this would not be happening. The sad truth is that nobody cares about patient care. Not docs -- nobody.

book [2008-09-21]
Love that book too. I have been doing this for over 30 years and I still found macros and short cuts I would never have thought about. It does help a lot. And if there is a dictator that does the same dictation pretty much all the time, or even just certain sentences all the time, save that under his ID number and something you will remember quickly, and then next time you will probably only have to change a few words.

working as an IC [2008-07-18]
Greetings: Can someone on this board give me some advice regarding working as an IC? I have 20+ years transcribing Pathology; I have also done the basic four, but I love Pathology. The hospital I work for has implemented VR, before that the outsourced our work (and our union did not do a THING about it)and some of us have already been given the boot. Only thing I will say is that it is a big HMO and it starts with the letterthat comes after J('nuff said). Any advice you can give me will be greatly appreciated

You're right but ... [2008-04-11]
Yes, absolutely, the suits and middle managers have no clue at all, nada, zip, zilch about medical transcription. However, many doctors actually invest in offshore MT companies .... according to Wall Street Journal. It was, oh, maybe 10 years ago that there was a caption or article about medical transcription being where the money is, as in investments, etc. You're right. Typically the MDs don't know and don't care who transcribes their dictation. Most do care, however, about quality at least to some degree. I'm just glad someone came up with a study as to cost effectiveness for whatever reason. It's like they're thrown us a crumb. Hope we get the whole cookie soon.

Stand firm! [2008-04-08]
I agree. I actually knew someone who typed some work with no spaces after a new client complained about the cost and said something about being ripped off because of paying for spaces. The gal that did this was actually a past president of AAMT, years ago I might add. She took it on the chin, took the next few tapes home, and returned a few reports with no spaces, no line spacing, etc. The office manager flipped her lid and went nutso on her. Hmmm, my friend said, I don't do anything I don't get paid for. End of story, end of a headache account. I still smile when I think of that story. That would be like a surgeon saying, Oh, I don't get paid for the stapling your wound shut, so I had the nurse use the masking tape. Single spacing after a period makes me crazy too. Do the math. It just to rip us off a bit. Think about how many spaces are saved over thousands and thousands of transcribed lines with single spacing after periods, and know if you are doing that you are undermining the profession and everyone in it. Quit being stupid. If your employer disagrees, tell him/her to have at it themselves.

You're so right, SusieQ [2008-04-08]
I have a huge, huge problem with our professional organization. Errr, ummm, where is the word transcription in AHDI. We've had the plug pulled on us by the ole gals who've been holding the reins for years. It's like a good ole girl association. Most of them have worked for global services, hauled in the big bucks for helping get those services off the ground, and have done it all with no second thoughts. It makes me sick. Our compensation hasn't increased at all. In fact, it has decreased steadily for the past decade. I do, wholeheartedly, wish we could unionize somehow. We should be paid hourly at a sizable rate like other skilled trades. I hate to say it, but our profession is made up of nearly 100% women. We need to be confident, stand up for ourselves, and not let this get any further out of hand.

Job openings [2008-02-08]
Can anyone please send me emails on services who have been willing to supply the MT with up to date, state of the art, platforms to work on. I am so sick and tired of starting jobs with services only to find out you have to copy and paste your work from A to B, because of crappy platforms, or if you don't copy and paste, the platforms are so prehistoric, you could type faster on a selectric. I want to work, have 35 years exp in all field. I have invested major money into up to date computers, software, hardware, etc so I can perform my job for the service to the best of my ability - what comanpies have done the same for us? I am looking again - someday I might find that one service who is looking out for us, as well as their pocketbooks. I don't expect to make millions, I dont' mid ESL doctors, or doing OPS or even working weekends, all I ask is respect for our profession and provide us with quality tools to perform out jobs. ANY INFORMATION WOULD BE GREATLY APPRECIATED - I hope this posts, I have put many posts on this board, but they are never published ?

some companies do this [2007-08-22]
I have gone to Washington DC to train for a company before. They paid. Breakfast, lunch included. Transportation from hotel to company provided. I was only responsible for dinner moneywise. Group of about 14 of us. Made really good friends. No longer work with the company but still keep in touch with other MTs from training. This was about 5 years ago.

Well said... [2007-08-12]
I could not have expressed myself better. I have been an MT for 35+ years and have watched our line count/rates decline and be manipulated. We the worker bees are the ones that take it in the shorts...the big companies still get their profits. Our professional organization does not even support us. It is all about politics and lining pockets. If I did not love what I am doing, I would have thrown in the towel a long time ago.

Years ago, when I started all we used were [2007-07-13]
hand controls. Haven't seen any in years, but I would assume they still make them.

VBC- just another way to rip us off. Dowetypereportslikethisnottomentionalltheworkwedonotgetpaidfor! [2007-05-26]
Do we get paid when the doctor changes his mind and redictates? No. Do we get paid extra when the doctor does not dictate the date of exam or the correct one, and we have to dig through 100 patient sheets? No. Do we get paid for looking up the spellings of doctors' names and addresses? No. Does the amount we are now getting paid cover software expenses, AAMT dues, business license, tax accountant, reference books, computers, car expenses for those accounts that insist on tapes that only put 1-2 reports on the tape that do not even cover gas or time spent driving/getting dressed, IT techs, phone lines, template setups, training other MTs, call-in systems, transcribers, foot pedals, office rent, medical expenses related to work injuries, paid time of when seeing a doctor for these injuries, surgeries, etc.? Not hardly. I have 7 years of experience working over 120 hours a week, 7 days a week and make less per line than the first 2 weeks I was interning in college. Jeesh, we have to hit the space bar to separate words. If you have radiculopathies as bad as I do, each keystroke hurts like heck, and I should get paid for it. Unfortunately, I cannot say space to my computer, and it magically puts it in. Just for once, instead of the doctors cutting our paycheck, why not going after the overpaid HIM department who came up with this hairbrain idea!!! They are on salary. It does not cost them money to go to the bathroom, yet everytime we take our hands off the keyboard, we pay! How would the HIM department like to read their reports like this? Laboratorydata:Completebloodcountstodayevealawhitebloodcellcountof,000/mm3,hemoglobin of2.3gm/dL,andaplateletcountof93,000/mm3. I say they can pick up my medical bills, which in the last 2 years were over $3 million with us paying over $90,000. Did I remember to include all the money it costs in lost work to apply for a job only to get ripped off on your paychecks or have them pay so late that after late fees, there is nothing left. Oh yeah, advertising, websites, e-mail accounts, FTP, cell phone, fax lines, equipment, equipment, equipment.

I would tend to somewhat agree [2007-05-11]
If you have a family you certainly cannot be working the hours that one must to earn a decent living. I myself work 16 hours and its ridiculous. I have to work this many hours to make what I used to make about 10 years ago. Things have changed much.

i so don't agree w/this post...I made more doing [2007-02-18]
so I continue to say to the newbies to the field, be careful what you read on these types of bulletin boards and/or forums - everyone's experience is different and please do not book your $$ on people whose experiences have not been as good as others..... I'm telling you, I'm in this biz close to 30 years and 10 years on my own and this year I made a fewgrandmore in $$ working for a nat'l than last year.......... If you plug it out, stick to a schedule,it still can be done, and I'm doing editingtoo (love it, easier on hands) and am twice as fast as I am on regular typing reports so.......again, some are just AGAINST editing, whereas I LOVE editing (did it 30+ yrs ago for a newspaper)..... Best of luck - remember to try to be optimistic (glass half full) versus choosing to be pessimistic (glass half empty) - THAT, TOO, WORKS REAL WELL.........

Medware [2007-01-30]
What did they offer you and how do you know how much to ask for. I have 10 years experience, and can you please tell me what ESL means and IC, thanks not used to this ...

It is still possible, I made $90,000 this past year [2007-01-16]
working full time straight production for one of the big nationals, 8.75 cpl base plus incentives and part time for a smaller national at 9.5 cpl. The most I worked at both was 60 hours a week. Made just over 70,000 at my FT position alone at 40 hours a week plus occasional OT but took the second just to have options in case work got low. It has taken me 15 years to buid up speed and expansions and $55,000 was my previous high but it's not totally out of the question to do. I should add that I am single and no kids, so I'm sure the lack of distractions helps my production quite a bit.

That must be $50 per day, must be typo. (sm) [2007-01-16]
After 30 years, Iknow how to type.

I couldn't have said it better. I am sm [2006-12-14]
a MT for almost 30 yeasr and I too made a whole lot more money years ago than i do now. MT has taken a step backwards and where as years ago I would recommend anyone get into the field. I don't do that anymore and am looking at getting out myself!

The most I made as an MT was $68K and that was [2006-11-16]
one year only and it was in 1995. It went down from there because lines were counted differently. I made the $68K on gross lines and that was just 60 spaces on the line, 10-pitch courier. Now, as a QA manager I made over $60K and other positions in the field paid me over $50K, but these were not 8 hours a day...more like 24/7. I doubt I could make much today doing MT as I have moved into other areas of it, but I might be able to do $23-25 an hr if I did the 300 lph I did back in 2003. Believe me though, you really have to know pretty much everything to make that money and know how to spell on first shot, etc. It takes a long time to get to that point, more than 5 or 6 years of MT experience. This field is moving backwards for the MT unfortunately and I feel so badly for anyone coming into our field unless their aspirations are for management/mentoring, etc.

Supply and demand [2006-07-31]
That is only going to supply the industry with cheaper labor! If the demand is that high for MTs then it would seem we would be paid more since there do not seem to be enough of us, right? Then here comes AAMT to the rescue with the latest of their nutty ideas - training people to do our jobs for even less! Seems to me that would flood the labor pool with new MTs (I use the term loosely here) and drive down our wages. I am so glad I gave up my membership and CMT years ago when I saw the direction they were going. I still have friends who are AAMT members who, IMHO, appear to be brainwashed. One person told me recently that the USA does not have enough people interested in becoming an MT and that is why AAMT is recruiting overseas and it will not impact our jobs at all. Argh!

Mighty, it's not going to 50 years, [2006-07-06]
think it is more like 5 to 10 years.According tothis report,India already has 45% of our jobs, and what about Ireland, and most likely other countries have a finger in the MT pie....and with our government encouraging outsourcing, well, the writing is on the wall, that's for sure. Also I wish someone tell Mr. Dumaguin thatwe aretranscriptionists, nottranscribers....but he's got the money, guess he can say whatever he pleases.

How much do you make? [2006-06-04]
I have two years of medical transcription experience. I was making $12 per/hour, that was six years ago in Toronto, Ontario, Canada. I have been out of this field for six years due to moving to the US because of work for my husband. I haven't worked in six years and am thinking about getting back into MT. I do not know how much they pay for this here in the US. That's why the question to you. $30 an hour isn't bad.

$50,000 indeed [2006-06-03]
Ugh! I am so sick and tired of seeing those bloated salary projections. I was an MT for 15 years and the most I ever made was $31,000 - and that job was hourly. The most I ever made on production was $23,000. Makes me sick.

if the isn't there where is it [2006-05-30]
Okay, you guys are deprssing I have been in school now for almost 2 years I know darn well, there are jobs out there, but the money is not what anyone thinks it is going to be. You have to be reasonable at best. I hope to keep my day job and do part time to get going is that something that might work?

MedQuist Announces Unaudited Financial Results, 6 Million in Operating Loss [2006-05-11]
MT. LAUREL, N.J.--(BUSINESS WIRE)--May 11, 2006--MedQuist Inc. (Pink Sheets: MEDQ.PK) announced today certain preliminary, partial and unaudited financial results, and provided updated information regarding previously-announced litigation and governmental investigations and proceedings. Once the Company completes the financial assessment and review of its billing practices disclosed in the Company's previous filings with the SEC, KPMG LLP, the Company's independent registered public accounting firm, will complete the audit the Company's financial statements. The Company is continuing the process of working toward becoming current in its periodic reports pursuant to the Securities Exchange Act of 1934. The Company's review of its current and prior period unaudited financial statements, as well as KPMG LLP's audits for those periods, may identify adjustments or reclassifications which may be reflected in the periods to which they relate. At this time, the Company cannot estimate the total costs of (i) the billing review, (ii) defense of the class action matters, (iii) the SEC investigation, and (iv) compliance with the Department of Justice investigation, all of which have been previously disclosed in either the Company's filings with the SEC or the Company's press releases. Accordingly, the only costs related to the defense of these matters that have been included in the results below are actual costs incurred through March 31, 2006 by the Company. Because the completion of the billing review and resolution of the litigation and governmental investigatory matters are pending, the Company is not certain whether any changes to the accounting treatment of any component of its consolidated financial statements will be required and, if any changes are necessary, whether any such changes would have a material impact on its current or prior period consolidated financial statements. Accordingly, the financial information set forth below is preliminary, unaudited, and subject to change based on the completion of the financial assessment and review of the Company's billing practices, resolution of the class action matters and governmental investigations and proceedings, and the completion of the review and/or audit of its financial statements, as appropriate. The financial information and related narrative discussion set forth below is derived from the Company's internal books and records. The Company cautions investors not to place undue reliance on the financial information presented below. As a result of the developments described above and in the Company's previous SEC filings, the Company's financial statements have not been audited or reviewed by KPMG LLP, its independent registered public accounting firm. The financial information contained in this press release also has not been audited or reviewed by an independent registered public accounting firm. Such information is not a substitute for the information required to be reported in the Company's Forms 10-K and Forms 10-Q that have not yet been filed. There can be no assurance that the results of the billing review, and resolution of the litigation and governmental investigatory matters will not have a material adverse effect on the Company's revenue, results of operations and financial condition. Legal Proceedings Investigations and Proceedings Commenced by the SEC and the Department of Justice As previously announced, the Securities and Exchange Commission (the SEC) is currently conducting a formal investigation of the Company. The Company will continue to fully cooperate with the SEC. As previously announced, the Company received an administrative HIPAA subpoena for documents from the United States Attorney's Office for the District of Massachusetts on December 17, 2004. The subpoena sought information primarily about the Company's provision of medical transcription services to governmental and non-governmental customers. The information was requested in connection with a government investigation into whether Medquist and others violated federal laws in connection with the provision of medical transcription services. MedQuist continues to cooperate fully with the Department of Justice. Shareholder Securities Litigation As previously announced, a shareholder putative class action lawsuit was filed against the Company in the United States District Court District of New Jersey on November 8, 2004. The action, entitled William Steiner v. MedQuist, Inc., et al., Case No. 1:04-cv-05487-FLW (the Shareholder Putative Action), was filed against the Company and certain former Company officials, purportedly on behalf of an alleged class of all persons who purchased MedQuist common stock during the period from April 23, 2002 through November 2, 2004, inclusive (the Class Period). The complaint specifically alleged that defendants violated federal securities laws by purportedly issuing a series of false and misleading statements to the market throughout the Class Period, which statements allegedly had the effect of artificially inflating the market price of the Company's securities. The complaint asserts claims under Section 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5, thereunder. Named as defendants, in addition to the Company, were its former president and chief executive officer and its former executive vice president and chief financial officer. On August 16, 2005, a First Amended Complaint in the Shareholder Putative Class Action was filed against the Company in the United States District Court District of New Jersey. The First Amended Complaint named additional defendants, including certain current and former directors, certain former Company officers, the Company's former and current external auditors and Koninklijke Philips Electronics N.V. (Philips). Like the original complaint, the First Amended Complaint asserted claims under Sections 10b and 20(a) of the Securities and Exchange Act of 1934 (the Act) and Rule 10b5 of the Act. The Class Period of the original complaint was expanded 20 months and now includes the period from March 29, 2000 through June 14, 2004. Pursuant to an October 17, 2005 consent order approved by the Court, Lead Plaintiff Greater Pennsylvania Pension Fund filed a Second Amended Complaint on November 15, 2005. The Second Amended Complaint dropped Philips as a defendant, but alleges the same claims and the same purported class period as the First Amended Complaint. Plaintiffs seek unspecified damages. Pursuant to the provisions of the Private Securities Litigation Reform Act, discovery in the action is stayed pending the filing and resolution of the defendants' motions to dismiss, which were filed on January 17, 2006, and will be fully briefed by May 26, 2006. The Court has not set a hearing date on the motions. The Company believes that the claims asserted in the Second Amended Complaint are without merit, and is vigorously defending the action. Customer Litigation As previously announced, a putative class action was filed in the United States District Court Central District of California. The action, entitled South Broward Hospital District, dba Memorial Regional Hospital, et al. v. MedQuist, Inc. et al., Case No. CV-04-7520-TJH-VBKx, was filed on September 9, 2004 against the Company and certain present and former Company officials, purportedly on behalf of an alleged class of non-Federal governmental hospitals and medical centers that the complaint claims were wrongfully and fraudulently overcharged for transcription services by defendants based primarily on the Company's use of the AAMT line billing unit of measure discussed below. The complaint charges fraud, violation of the California Business and Professions Code, unjust enrichment, conversion, negligent supervision and violation of the Racketeer Influenced and Corrupt Organizations Act. Plaintiffs seek damages in an unspecified amount, plus costs and interest, an injunction against alleged continuing illegal activities, an accounting, punitive damages and attorneys' fees. Named as defendants, in addition to the Company, were a senior vice president, its former executive vice president of marketing and new business development, its former executive vice president and chief legal officer, and its former executive vice president and chief financial officer. On December 20, 2004, the Company and individual defendants filed motions to dismiss for lack of personal jurisdiction and improper venue, or in the alternative, to transfer the putative action to the United States District Court District of New Jersey. On February 2, 2005, plaintiffs filed a Second Amended Complaint both adding and deleting named plaintiffs in an attempt to keep the putative action in the United States District Court Central District of California. On March 30, 2005, the United States District Court Central District of California issued an order transferring the putative action to the United States District Court District of New Jersey. On August 1, 2005, the Company and the individual defendants filed their respective Answers denying the material allegations contained in the Second Amended Complaint. On August 31, 2005, the Company and individual defendants filed motions to dismiss the Second Amended Complaint for failure to state a claim and a motion to dismiss in favor of arbitration, or in the alternative, to stay pending arbitration. On December 12, 2005, the plaintiffs filed an Amendment to the Second Amended Complaint. On December 13, 2005, the Court issued an order requiring plaintiffs to file a Third Amended Complaint. Plaintiffs filed the Third Amended Complaint on January 4, 2006. The Third Amended Complaint expands the claims made beyond issues arising from contracts based on AAMT line billing and beyond customers billed based on an AAMT line, alleging that the Company engaged in a scheme to inflate customers' invoices without regard to the terms of individual contracts and even in the absence of any written contract. The Third Amended Complaint also limits plaintiffs' claim for fraud in the inducement of the agreement to arbitrate to the three named plaintiffs whose contracts contain an arbitration provision and a subclass of similarly situated customers. On January 20, 2006 the Company and individual defendants filed motions to dismiss the Third Amended Complaint for failure to state a claim and a motion to compel arbitration of all claims by the arbitration subclass and to stay the case in its entirety pending arbitration. On March 8, 2006 the Court held a hearing on these motions, and took the matter under submission. The Court has not yet ruled on the motions. The Company believes that the claims asserted have no merit and intends to vigorously defend the putative action. Medical Transcriptionist Litigation Hoffmann Putative Class Action As previously announced, a putative class action lawsuit was filed against the Company in the United States District Court Northern District of Georgia. The action, entitled Brigitte Hoffmann, et al. v. MedQuist, Inc., et al., Case No. 1:04-CV-3452, was filed with the Court on November 29, 2004 against the Company and certain current and former Company officials, purportedly on behalf of an alleged class of current and former employees and statutory workers of MedQuist, who are or were compensated on a per line basis for medical transcription services (the Class Members) from January 1, 1998 to the time of the filing of the complaint (the Class Period). The complaint specifically alleged that defendants systematically and wrongfully underpaid the Class Members during the Class Period. The complaint asserted the following causes of action: fraud, breach of contract, demand for accounting, quantum meruit, unjust enrichment, conversion, negligence, negligent supervision, and Racketeer Influenced and Corrupt Organizations Act violations. Plaintiffs sought unspecified compensatory damages, punitive damages, disgorgement and restitution. On December 1, 2005, the Hoffmann matter was transferred to the United States District Court District of New Jersey. As discussed immediately below under the heading Myers Putative Class Action, the Company believes that the claims presently asserted have no merit and intends to vigorously defend the putative action. Myers Putative Class Action As previously announced, a putative class action entitled, Myers, et al. v. MedQuist Inc. and MedQuist Transcriptions, Ltd., Case No. 05CV 4608 (JBS), was filed against the Company on September 22, 2005 in the United States District Court District of New Jersey. The action was brought on behalf of a putative class of MedQuist's employee and independent contractor transcriptionists who claim that they contracted with the Company to be paid per AAMT line, but were allegedly underpaid due to intentional miscounting of the number of characters and lines transcribed. The named plaintiffs asserted claims for breach of contract, unjust enrichment, and request an accounting. The allegations contained in the Myers case are substantially similar to those contained in the Hoffmann putative class action and the two actions have now been consolidated. A consolidated amended complaint was filed on January 31, 2006. The named plaintiffs assert claims for breach of contract, breach of the covenant of good faith and fair dealing, unjust enrichment and demand an accounting. On March 7, 2006 the Company filed a motion to dismiss all claims in the consolidated amended complaint. The motion has now been fully briefed. The Court has not set a hearing date on the motion. The Company believes that the claims asserted in the consolidated actions have no merit and intends to vigorously defend the suit. Derivative Litigation On October 4, 2005, the Company announced the dismissal with prejudice of a shareholder derivative action filed in United States District Court District of New Jersey. The suit, Rhoda Kanter (Plaintiff) v. Hans M. Barella et al. (Defendants), was filed on November 12, 2004 against Philips and ten current and former members of MedQuist's Board of Directors. MedQuist was named as a nominal defendant. In a ruling dated September 21, 2005, the Court found Plaintiff's allegations that MedQuist's Board members breached their fiduciary duties to the Company to be insufficient. The Plaintiff had alleged that for a period from 2001 through 2004, the Defendants violated their fiduciary duties by permitting artificial inflation of billing figures; failing to adequately ensure accurate and lawful billing practices; and failing to accurately report the Company's true financial condition in its published financial statements. To the contrary, the Court concluded: Far from alleging facts supporting a substantial likelihood of liability, Plaintiff here has painted a picture of a board of directors that acted responsively given the circumstances . . . . On October 3, 2005, plaintiffs filed a motion for reconsideration of the Court's order dismissing the action with prejudice. On November 16, 2005, the Court denied Plaintiffs' motion for reconsideration. On December 13, 2005, Plaintiffs filed a Notice of Appeal with the United States Court of Appeals for the Third Circuit. On March 21, 2006, Plaintiff filed her opening brief on appeal. On April 20, 2006, MedQuist and the other defendants filed their opposition briefs. The appeal will be fully briefed by May 4, 2006. The Court of Appeals has not set a hearing date for the appeal. Customer Accommodations As previously disclosed, the primary allegations in a number of the litigation matters relate to how the Company interpreted the AAMT line billing unit of measure. The AAMT line billing unit of measure was developed in 1993 through a collaboration among several industry organizations with the intent of providing standardization in industry billing practices. However, due to inherent ambiguities in the definition of this unit of measure not fully anticipated at the time of its introduction, AAMT line-based billing was applied inconsistently throughout the medical transcription industry and eventually renounced by the groups initially responsible for its development. Despite these issues, a number of companies in the industry have continued to use AAMT line-based billing, and some customers still request proposals and contracts based on the AAMT line. Like many medical transcription service providers, MedQuist once used the AAMT line unit of measure to calculate invoices for many of its medical transcription clients. It has been widely recognized and well documented throughout the industry, however, that the AAMT definition of a line is inherently ambiguous and subject to a wide variety of interpretations. In fact, no single set of AAMT characters was ever defined for this unit of measure. Accordingly, MedQuist began the process in 2004 of transitioning its AAMT line-based customers off the AAMT line unit of measure and, in April 2005, the Company completely eliminated the use of the AAMT line for billing and called on other industry transcription providers to follow its lead. Due to these AAMT line unit of measure ambiguities, and the disparity in its interpretation, health care providers have raised concerns regarding charges for transcription services by their respective transcription providers, including the Company. In response to those concerns, and to foster ongoing business relationships with its customers, the Company has approached certain customers and offered to resolve any issues related to their prior AAMT line and other billing related issues. As previously disclosed, the Company's Board of Directors has authorized Company management to make accommodation offers, up to an aggregate amount of $65.0 million, to certain customers to resolve any concerns over AAMT and other billing related issues. As of March 31, 2006, (i) the Company has entered into agreements with certain customers who have accepted accommodation offers to resolve concerns over AAMT and other billing related issues, and paid or credited an aggregate amount of $31.3 million as an accommodation to those customers and (ii) additional accommodation offers have been made by the Company to certain other customers in the aggregate amount of $11.9 million. From April 1, 2006 through the date of this release, the Company has entered into agreements with additional customers and paid or credited an aggregate amount of $2.9 million and has extended accommodation offers to additional customers in the aggregate amount of $1.1 million. Company management currently intends to make additional accommodation offers in the future, consistent with the Board's authorization described above, although the timing and amount of such offers have not yet been determined and the Company's plans may change in the future. The accommodation offers do not represent an estimate of potential liability, if any, in any of the previously disclosed litigation or investigatory matters pending against the Company. The Company is unable to predict how many customers, if any, will accept the outstanding accommodation offers on the terms proposed by the Company, nor is the Company able to predict the timing of the acceptance (or rejection) of any of these outstanding accommodation offers. Until such offers are accepted, the Company may withdraw or modify the terms of the accommodation offers at any time. In addition, the Company is unable to predict how many of the future offers, if made, will be accepted on the terms proposed by the Company. The Company believes that its existing cash resources and cash flows from operations are sufficient to fund all of the customer accommodation offers it may make. By accepting the Company's accommodation offers, the customer must agree, among other things, to release the Company from any and all claims and liability regarding prior AAMT and other billing related issues. The accommodation offers made to date, and those offers which may be made in the future, are not an admission of liability by the Company of any wrongdoing or an admission or acknowledgement that its billing practices with respect to such customers were or are incorrect. MedQuist Inc. -- Preliminary and Unaudited Financial Information (in millions) ---------------------------------------------------------------------- Three months ended ---------------------------------------- March 31, 2006 March 31, 2005 ------------------ ------------------ Revenues $ 97 $ 108 Operating loss $ (8) $ (2) ---------------------------------------------------------------------- As of As of March 31, 2006 December 31, 2005 ------------------ ------------------ Cash $ 164 $ 178 Debt $ - $ - Three Months Ended March 31, 2006 Revenues: Preliminary, unaudited results indicate that the Company's revenues decreased $11 million to $97 million for the three months ended March 31, 2006 from approximately $108 million for the comparable 2005 period. This decline in revenues is largely due to decreases in transcription outsourcing services and product sales of $9 million or 10%, and $2 million or 27%, respectively. The decline in transcription outsourcing revenues is largely due to a decrease in the volume of lines transcribed primarily related to clients for whom we no longer provide transcription services. Additionally, pricing pressures continued on the base transcription business during the first quarter 2006, but revenues were impacted far less by pricing pressures than in the comparable 2005 period. Management expects that pricing pressures will continue for the foreseeable future but that the introduction of several new sales initiatives and improved customer service programs should cause transcription volume to stabilize or improve throughout the duration of 2006. Operating Loss: Preliminary, unaudited results indicate that our operating loss increased $6 million to a loss of approximately $8 million for the three months ended March 31, 2006 from an operating loss of $2 million for the comparable 2005 period. The operating loss of $8 million was primarily attributable to $9 million of costs associated with the following: (1) costs related to the ongoing billing review including (i) legal fees incurred in connection with governmental investigations and proceedings and defense of the class action matters and (ii) non-legal professional fees; and (2) increased expenses related to prior years' accounting reviews and audit. Operating loss was also impacted by the $11 million decline in revenues over the same period. Balance Sheet Highlights: As of March 31, 2006, the Company had $164 million in cash and cash equivalents and no debt. The $14 million decrease in cash as of March 31, 2006 compared with December 31, 2005 was primarily attributable to accommodation payments ($10 million) and capital expenditures ($4 million). There were no issuances of capital stock or other securities for the three months ended March 31, 2006. The Company expects to incur significant costs and expenses in the future relating to the ongoing billing review, defense of the class action matters and governmental investigations and proceedings, and accommodation agreements. These costs and expenses include (i) legal fees relating to the SEC and Department of Justice investigations and proceedings, (ii) legal fees relating to defense and resolution of the litigation matters described above, (iii) customer accommodation payments and credits, and (iv) non-legal professional fees. The timing and level of these costs and expenses is, in many cases, not within the Company's control. While the Company is unable to predict the timing and level of these costs and expenses, the Company currently believes that it has sufficient resources, including cash on hand and cash flow from operations to fund these costs and expenses. However, there cannot be any assurance that unanticipated changes in the level of these costs will not exceed the Company's available cash resources, nor can there be any assurance that sufficient financing from external sources will be available to the Company on acceptable terms, if at all. In the event that the Company's cash requirements exceed its available cash resources, or if the timing of such costs and expenses requires the Company to divert cash resources away from operations, the Company may not be able to execute its operating plan, which could have a material adverse effect on the Company's business and results of operations. Other Developments Restructuring: As previously disclosed, in conjunction with the Company's movement to a single national service and support organization, a restructuring plan was developed in 2005 to consolidate approximately forty-eight (48) operating facilities and centralize certain components of the business in order to improve operating efficiencies. The Company is expecting to incur total restructuring costs of up to $8.5 million associated with this plan through the end of the fourth quarter of 2006. The Company incurred $1 million of restructuring costs for the three months ended March 31, 2006. This restructuring is expected to generate annualized savings of approximately $18.5 million. The Company realized approximately $1.9 million in savings during the three months ended March 31, 2006. Specifically, the Company has shifted resources to a single national service delivery and support organization for all of the Company's services and products and is in the process of eliminating local service centers. The plan does not contemplate reductions of, and the Company has no current intentions to reduce, its medical transcription workforce. Rather, the Company will continue in its efforts to hire additional qualified transcriptionists. Further, although the Company is consolidating its local service centers as described above, customer-facing teams, led by account managers, will continue to coordinate customer support on the local level. The customer-facing teams will continue to work with and be supported by the Company's centrally managed customer service organization.