We worked hard and productively in the past year and the results began to show toward the end of the year. Our investments in technology continued and we added to our management and sales teams.

Three years of work restructuring our medical review product line began to come together as we completed fiscal 2006 in March. Although three years sounds like a lot of time, this major change in our processing has opened many new opportunities to further improve our services. We are just beginning to develop the tools that are enabled by the new document management environment. Outcomes have been improved for customers and a number of further improvement identified. We see “continuous improvement” as a constant in our future.

CorVel remains focused on our vision of creating new and more effective solutions in the disability marketplace. Document and workflow management, smart processing and evermore powerful computing systems have combined to position us for the next generation in healthcare management solutions.

One such area of development is the use of artificial intelligence in the management of claims. While such tools have more traditionally been employed in computational processes, new applications manage workflow, organizing previously scattered manual processes. In addition, expanding and enhancing our data center has been, and will continue to be, an ongoing investment. Conversions to next generation of processing and the related new software capabilities this enables have been, and will continue to be, a significant investment in our infrastructure.

I very much appreciate the tremendous effort our organization has made to accommodate the new demands created by Federal and State legislation. The market in which we operate has changed substantially, and we expect continuing change. Our responses have gained momentum and are now producing results. We have been passing through a period where we have been restructuring our strategic focus to facilitate the next phase of our development.

We operate in a complex insurance marketplace and did not expect the magnitude of the decrease in claims volume that occurred over the last five years. The regulatory environment has also been asking a lot of us. Our decentralized structure has provided us with flexibility to respond to the changes and to help us set our sails for the next leg of our journey.