Hospital Holding Company
Service:Business Viability Assessment
Company:A hospital holding company, which owned and operated six regional hospitals.
The hospital lacked a sound cash flow plan, was experiencing operating inefficiencies and was rapidly losing money as a result.
Focus Management Group was retained by the Company’s lender to analyze its operations and those of its operating hospital subsidiaries, to determine the cause of continuing losses and to make recommendations for improvement.
Focus Professionals assessed each hospital for viability, assisted in restructuring Company loans and developed an improved cash flow plan for the holding Company. The Focus team also conducted interviews with Company management and physician staff members, and reviewed elements of third party planning reports and internal reporting documents, to determine areas for profit improvement. After their initial review, the Focus team determined that several of the hospital operating entities had declined past the point of cost-effective turnaround and that significant capital and time would be required to execute a strategic plan to improve profitability.
Following our suggestion, the Lender was successful in refinancing itself out of the transaction before its collateral position had been eroded to the point where potential shortfalls might have occurred.