The intricate and dynamic landscape of the healthcare market can challenge even the most robust organizations. We act as a trusted advisor to hospitals and other healthcare providers, offering guidance on strategic decisions that directly influence present and future financial performance.
We regularly assists banks, bondholders, private equity firms, and committees of unsecured creditors, along with their legal and accounting advisors, in navigating intricate business transactions or restructurings involving healthcare providers. Our services include Creditor Advisory, Operational Due Diligence, and Financial Due Diligence Services.
Unlike many of our competitors, each financial advisory engagement with us is spearheaded, "on the ground," by seasoned C-Level healthcare executives. Our project portfolio spans a wide spectrum. For instance, in collaboration with a leading investment bank, we conducted an in-depth analysis of the potential impact of proposed extensive and intricate alterations to the Medicare payment system within the home health agency market. Our analysis pinpointed the companies poised to gain and those likely to face setbacks due to the proposed changes, along with quantifying the magnitude of these effects.
In a separate instance, we collaborated with a highly prosperous behavioral health managed care organization based in the Northeast to chart a fresh strategic course and enhance the organization's overall enterprise value. We assumed a crucial role in implementing the devised strategy, which involved identifying and engaging in negotiations with potential merger counterparts. Thanks to our decisive leadership, the organization now stands as the premier behavioral health division of the nation's largest Medicaid managed-care organization.
Creditor Advisory
We offer comprehensive support to creditor groups involved in healthcare provider organizations undergoing intricate restructuring, bankruptcy, and distressed scenarios. Our services empower lender groups, bondholders, trade creditors, investors, and other stakeholders to swiftly and precisely assess the risks and opportunities linked with a provider's business plan. Our objective is to assist all parties in making well-informed business decisions that optimize overall recoveries.
Our creditor advisory services include:
- Review of short-term cash flow projections
- Analysis of cash conservation efforts and procedures
- Analysis of business plans, including risks and opportunities
- Valuation of collateral packages on both an ongoing or liquidation basis
- Assistance in negotiation of amendment and forbearance agreements
- Review and assessment of restructuring alternatives
- Performance monitoring following business plan implementation
Financial Due Diligence
Our financial due diligence services are delivered by a seasoned team of healthcare executives. We meticulously assess the quality of earnings and working capital needs through a comprehensive analysis of financial statements, patient demographics, market positioning, and extensive on-site consultations with medical staff, management, and board members. Our targeted and customized approach allows us to swiftly pinpoint and comprehend potential deal breakers, value catalysts, and other critical areas tailored to our clients' needs.
Our suite of financial due diligence services comprises:
- Evaluation of the target provider's earnings quality, which entails identifying any overly aggressive accounting practices and assessing the adequacy of third-party contractual allowances, alongside an examination for compliance with GAAP accounting standards.
- Analysis of the cash flows revenue cycle (e.g., working capital changes, capital expenditures)
- Examination of both on- and off-balance sheet assets and liabilities, encompassing notable operating lease commitments.
- Leveraging our proprietary financial modeling and data analysis tools to evaluate market positioning and payor mix, with a focus on pinpointing market opportunities, profitability trends, and notable risk concentrations.
- Assessment of management's financial forecasts and strategic business plans.
- Extensive dialogue with management and their advisors to gain comprehensive insights.
- Conducting thorough due diligence for both buy-side and sell-side transactions.
Operational Due Diligence
Enlightened lenders and investors recognize that prosperous transactions hinge on a deep comprehension of historical and projected financial data. To optimize returns and mitigate risks, hospitals and other providers must incessantly refine operational efficacy, pinpoint and capitalize on market prospects, and optimize cash flow efficiency. Leveraging the expertise of our seasoned healthcare executives, we aid clients in scrutinizing the quality and effectiveness of pivotal patient services and processes. Through meticulous, evidence-driven analysis, we pinpoint, quantify, and validate opportunities for EBITDA enhancement. Our cohesive operational and financial due diligence teams collaborate closely to swiftly construct a holistic view of the investment potential.