Cath Lab Management Agreement
ValuePoint was retained by a large multi-state healthcare system
to perform the fair market value determination for compensation
provided for in a Management Services Agreement. The agreement
provided for management of the cardiac catheterization lab as well
as participation in the management of the overall cardiovascular
service line. A significant component of this Agreement was
compensation determined by performance against specified quality
metrics. This Agreement is unique in that ValuePoint determined
the fair market compensation for three specific components of the
agreement; 1) a fixed management component; 2) a variable management
component; and 3) the quality incentive compensation. ValuePoint’s
work product was reviewed and approved by three highly qualified
and experienced healthcare law firms. Our participation in
this project allowed the health system to strengthen their collaboration
with physicians and expand the provision of services to the community.
Cancer Center Under Arrangements
ValuePoint was engaged by a large not-for-profit healthcare
system located in the Southeastern United States to determine
the fair market value compensation, on a per procedure basis,
of an arrangement with a group of physicians to provide linear
accelerator and PET/CT services under arrangement. At the
start of this project, the coverage for PET/CT was in its early
stages. After determining the per procedure compensation
amounts based upon anticipated costs plus a required rate of
return, we compared the results with expected reimbursement amounts
in order to test the reasonableness of our conclusions. This
analysis was complicated by the fact that the PET/CT was an emerging
technology at the time. The agreement was successfully
negotiated and is expected to be renewed for an additional term. Our
client was very pleased with ValuePoint’s healthcare expertise
and ability to provide valuation consulting services that were “outside
the box.”
Hospital
Acquisition
ValuePoint was engaged to perform a fair market value appraisal
of a not-for-profit hospital in connection with its planned sale
to another hospital organization. The hospital had suffered significant
operating losses in recent years and needed to complete the transaction
to remain competitive and viable. The hospital management team
was under a tremendous amount of pressure to respond quickly to
interest expressed by a potential buyer. The financial impact of
the transaction had to be balanced with the impact on the community
as the hospital was community-owned. We analyzed the hospital’s
operations and used a combination of market and asset methodologies
to establish its value. Our analysis and valuation opinion assisted
with successfully completing the transaction and satisfying the
hospital’s regulatory and community obligations.
Ambulatory Surgery Center
ValuePoint was retained by a large healthcare system to determine
the fair market value of its outpatient surgery department, which
was being transferred to a new ambulatory surgery center (ASC). Minority
interests in the ASC were being offered for sale to area physicians.
Since the outpatient surgery department was structured as an integral
part of the hospital, we were unable to obtain complete financial
statements for its operations. However, the ValuePoint professionals
who worked on this engagement were able to draw upon their healthcare
industry experience and assisted the client with constructing pro-forma
financial data reflective of the department’s operations.
As a result, we were able to establish the fair market value of
the ASC interests being sold and our client closed the transaction
with confidence that it satisfied regulatory requirements |
