Healthcare Partners Investments LLC

Client

Bridge was hired to serve as Interim Chief Financial Officer and turnaround consultants to Healthcare Partners Investments LLC (“HPI”) in connection with a series of technical defaults under its senior credit facility.

Challenge

HPI is a physician-owned, $100 million operator of 3 hospitals and two ambulatory surgery centers (“ASCs”) principally in the Oklahoma City market area. In early 2007, HPI faced a number of challenges, including: (a) a variety of technical defaults under its senior credit facility, (b) the departure of three senior executives, including the CFO, (c) serious concerns about the quality of the Company’s financial reporting, including two consecutive years of dramatic year-end A/R adjustments, (d) a tightening liquidity situation which had caused aged payables to climb to troublesome levels, and (e) a recent history of making equity distributions in excess of available cash flow. These challenges caused a loss of confidence among the Company’s lenders and trade vendors.

Solution

Bridge provided a professional with substantial industry experience to serve as interim CFO and turnaround consultant. Bridge worked quickly to regain the confidence of the Bank Group by addressing financial reporting concerns. Bridge worked closely with the newly senior executive team to develop a turnaround strategy that included: (a) a variety of operational performance improvements, particularly in the revenue cycle process, (b) conditioning physician members to lower, more rational distribution levels, (c) retention of a permanent CFO, and (d) a complete recapitalization, including raising $15 million of new preferred equity and refinancing all remaining long-term debt.

Results

By the end of 2007, many short-term turnaround objectives were achieved, including regaining the confidence of the Company’s Bank Group, retaining a qualified CFO and Chief Accounting Officer, achieving substantial improvements in financial reporting, reducing aged trade payables and initiating substantial revenue cycle performance improvement initiatives. With Bridge’s assistance, the Company is aggressively pursuing all elements of its 2008 Strategic Plan and is within 60 days of completing a complex recapitalization