Contact us today: (303) 801-0111

Pinnacle Blog

  • Pinnacle Healthcare Consulting Adds Insurance and Risk Management Solutions Through Pinnacle Healthcare Insurance Advisors, LLC

    PINNACLE HEALTHCARE CONSULTING EXPANDS OFFERINGS
    TO INCLUDE PINNACLE HEALTHCARE INSURANCE ADVISORS (PHIA)

    Addition of Insurance and Risk Management Solutions
    Enhances Pinnacle’s Services and Healthcare Market Expertise

    CENTENNIAL, COLORADO (March 1, 2016) – Pinnacle Healthcare Consulting announces the launch of Pinnacle Healthcare Insurance Advisors (PHIA) to its current offerings.

    Effective immediately, an industry-leading healthcare industry insurance and risk management executive is transitioning to a new leadership role within Pinnacle. The move expands Pinnacle’s ability to respond to increasing client requests for technical insurance solutions to help manage their ever-changing, complex business risks. PHIA will offer risk solutions such as medical professional liability, management/executive liability, cyber risk, customized physician disability, stop loss, reinsurance, captives, equipment warranty, and property/casualty for physicians, hospitals, senior living facilities, life science and medical device firms, health technology, ambulatory surgery centers, accountable care organizations, and many other healthcare related firms.

    PHIA will be led by Michael D. Reis, ARM, CRIS. Mike is a recognized expert in insurance and risk management for the healthcare industry. Mike has over 20 years of experience in senior practice leader and business development roles for some of the world’s largest risk advisory firms. He specializes in medical professional liability, executive protection, cyber risks, group programs, strategic partnerships, alternative risk financing such as captives, and transactional solutions (M&A).

    “As Pinnacle expands, we have sought to develop services that not only complement one another, but also address health organizations’ most difficult challenges,” stated David White, Principal and Partner. “This strategy makes Pinnacle uniquely positioned in the industry to positively affect client risk management and business performance in multiple areas. PHIA represents another dimension in this strategy,” White added.

    Mike Reis, Managing Director of the new PHIA, explained, “It’s an honor to join a ‘best in class’ healthcare consulting firm such as Pinnacle Healthcare Consulting. Adding another area of expertise and risk solutions to Pinnacle’s unparalleled portfolio of services will allow Pinnacle’s clients to better manage their increasingly complex business risks in the changing healthcare environment.”

    With these additions, the firm’s size increases to 56 team members across 16 office locations around the United States.

    About Pinnacle Healthcare Consulting

    Pinnacle’s mission is to deliver high value advisory services that help its clients manage risk, improve performance and achieve strategic objectives. The firm’s vision is to create a dynamic organization that thrives on solving problems and devising lasting solutions for its clients while providing a professionally fulfilling and rewarding work environment for its people.

    Founded in 1998, Pinnacle Healthcare Consulting is a dynamic healthcare consulting company with expert resources to assist hospitals, physicians, and other health care organizations with operational, planning and transactional support needs. The consulting divisions and affiliated companies provide the health care industry with a multitude of resources and far reaching expertise to improve business performance.

    Pinnacle is a trusted advisor to a wide array of both for-profit and not-for-profit health organizations nationwide and provides services through five consulting divisions including Compensation Valuation, Business Valuation, Strategy and Operations, Coding and Audit, and Medical Practice Advisory. Affiliates of Pinnacle include Physician FMV, LLC, a web-based compliance support program designed to help health systems comply with complex physician compensation arrangements; Assistive Coding, LLC, a professional services company providing outsourced medical coding services; NorthGauge Health Advisors, LLC, an independent clinical peer review services company that leverages an expert physician network to address questions of clinical decision-making, medical necessity and related matters; and Pinnacle Enterprise Risk Consulting Services, LLC, with offerings spanning compliance, internal audit, litigation and independent review organization services. For more information, please visit www.AskPHC.com/PHIA.

    Continue reading →

  • Pinnacle’s Director of Business Valuation, Alex Kajan, was quoted in The Ambulatory M&A Advisor’s article “Building a Bridge Over the Value Gap in a Transaction”

    In a healthcare M&A transaction there are times when the value of the selling business is not on the same level as both the buyer and the seller.  Perhaps things were missed in due diligence,  or the buyer cannot raise the funds the seller is asking for.  Regardless, these issues occur, and The Ambulatory M&A Advisor shows the different ways that sellers and buyers can potentially bridge the value gap and seal a deal with minimal roadblocks.

    Peter Greenbaum, Business Law and Healthcare Attorney for Wilentz says that a valuation gap mean between a seller and a buyer is all about perception and expectation.

    “A seller perceives their business to be worth more than a third party perceives it to be; it gets back to perception.  It’s not uncommon that sellers want as much as they can and buyers want to pay as little as they need to.  You have a natural conflict in the way money works, and it oftentimes results in a gap in the valuation,” Greenbaum says.

    “You would like to believe that if you have a reasonable buyer and a reasonable seller, you are going to have a gap that is not too drastic.  When you have one party that may be out of line with what the market is bearing that is when you are going to have a bigger gap.  As long as everybody comes in with eyes open and aligned with what the market can provide and with the way they value the business, there will usually be some sort of gap but a gap that the businesses can work through.”

    Alex Kajan, Director, Business Valuation with Pinnacle Healthcare Consulting believes that the most effective way to bridge this gap is to find ways to grow revenue, reduce expenses, or reduce the riskiness of an investment in the selling company during the years leading up to the sale of the business.

    “There are a number of ways to do this and all of these are taken into account in determining the fair market value of a business.  Adding ancillary services to the business can enhance revenue potential.  Utilizing mid-level providers or negotiating better contracts with vendors can both help reduce expenses and enhance profitability.  These are the issues that most business owners easily identify, but often neglect to consider the riskiness of an investment in their business.  Concentration of referral and revenue sources, key person risk, lack of geographical diversification, and poor payor mix are common risks identified in the valuation process,” Kajan says.

    Kajan adds that if an owner did not focus on growing revenue, reducing expenses, or reducing the riskiness of an investment in the business prior to initiating their exit strategy, other methods can be employed depending on the facts and circumstances of the transaction.  For example, does the owner wish to retire or is there potential to remain engaged in operating the business to some extent.

    Greenbaum goes on to explain that there are many ways that a buyer and seller can bridge the gap between the differences in value that may arise.  According to Greenbaum, the earn out provision is a very typical way of bridging that gap because typically in an earn out, the buyer can reward the seller slightly more than they otherwise would have.  It allows the seller to, while taking some risk, get a greater upside.  At the same time, from the buyer’s perspective, the buyer has a comfort level that the business and revenue stream that it is buying, is in fact there.  Therefore, often times in the earn out, a buyer will share more than they would otherwise would have been paid if it was a straight up purchase price.

    Brian Berlandi, managing partner, Berlandi, Nussbaum & Reitzas LLP  adds that an earn out is also the kind of gesture a seller makes for a buyer who might have difficulty getting traditional financing from a bank therefore, pushing a value of the business that the seller does not see as fair.  Berlandi says that this is one of the benefits involved in the deal for the buyer.

    “The seller may have a buyer who wants to buy the property, but the buyer is having trouble getting traditional financing.  The seller doesn’t want that to kill the deal, so it offers to finance the property for the buyer to get the deal done.  It’s usually not the first choice of a seller to do that, but if it doesn’t have a better option and wants to keep the deal intact, a seller will offer it,” Berlandi says.  “For buyers, if you can’t get traditional financing, which will usually have better interest rates, you are still able to consummate the deal because the seller is financing it for you.  It’s good for the seller and good for the buyer to keep the deal intact.”

    Kajan explains that earn out provisions can be useful if a seller believes the current fair market value is not representative of what the fair market value would be over the next several years.  Generally, with an earn out provision, there is an upfront payment for the business and an additional payment (or payments) that the seller will receive contingent upon achieving predetermined financial goals after the transaction closes.

    “If the seller believes the business is truly worth more than the current fair market value, this is a way for the seller to capitalize on the future success of the business should the financial goals be achieved.  I would note that to the extent the earn out provisions are aligned with services referred from the seller to buyer post-transaction, legal counsel should be consulted as the earn out could be viewed as a payment for future referrals,” he says.

    Kajan says another way to bridge the gap is through seller notes.

    He says a seller note allows the buyer to pay for the business over time.  If the seller is willing to forgo a large portion of the upfront payment, the note can provide interest for the seller over time.  This could be an attractive option for a business owner who is willing to shoulder this additional risk in hopes of a greater return.  Additionally, as dollars in the future are worth less than dollars today, this could be attractive to the buyer if the interest rate on the note is manageable.

    Greenbaum says that from a buyer’s perspective, the seller holding the paper will give the buyer a little more comfort that the seller will stand behind the business.

    “A buyer’s fear is that the seller’s representation in terms of the revenue stream among other things, may not materialize.  If the seller is willing to hold paper, it will give the buyer a little more comfort that the seller will stand behind what the seller has in fact said the economics are.  If it’s not there, then the seller is not going to get paid.  It’s a way of keeping the seller’s skin in the game that otherwise would not have been there if it was an all cash deal where the buyer either had their cash in pocket or from a third party bank.  Once that happens there is no real skin in the game from the seller’s perspective, and that is when the buyers become concerned,” Greenbaum says.

    Although selling less control of the company to a buyer is a way of addressing the bridging of the gap in a sale, Greenbaum says more often than not, it can create problems.

    “When a buyer comes in and wants to buy a company, they typically want to buy one hundred percent of the company; they do not want a partner.  They do often keep the sellers around or need the sellers to stay around, whether for employment related reasons or from a transitioning perspective in the sense that the sellers are the ones knowing how to run the business and therefore need to effectively teach the buyer,” he says.

    “Beyond the service component, whether it is a long-term employment relationship or just a short-term transitioning relationship, moreoften than not, having buyers and sellers remain partners post-closing, that is not the objective of either side.  You have a seller that wants to cash out and move on typically, therefore, remaining on as co-owners or partners after a closing doesn’t necessarily achieve that goal.”

    Kajan says the success of this strategy really depends on the seller’s willingness to remain engaged with the business over time.

    “Buyers are generally seeking to gain control of a business.  To the extent a seller is willing to sell a controlling interest in their business and a buyer is willing to allow a seller to remain engaged as a minority interest holder, there could be value to positive changes the buyer could make to the business after the transaction occurs.  This can come in the form of greater geographical reach, economies of scale leading to more favorable contracts, etc.  The issue this can create for a seller is that they now have a minority interest in a company that is more difficult to liquidate and they also now lack control should disagreements come about in the future.  A seller really has to consider what benefits the buyer could bring to the table post-transaction and whether or not they want to remain onboard with a business they no longer control,” Kajan says.

    If you have an interest in learning more about the subject matter covered in this article, the M&A process or desire to discuss your current situation, please contact Blayne Rush, Investment Banker at 469-385-7792 or Blayne@AmbulatoryAlliances.com.


    Continue reading →

  • Seasons Greetings from Pinnacle!

    Continue reading →

  • Season’s Greetings from Our Family to Yours!

     

     

    From Our Pinnacle Family to Yours,

    Season’s Greetings!

    Thank you for you continued support.  We wish you a happy and healthy New Year!

    Pinnacle Seasons Greetings

     

     

     

     

     

    Continue reading →

  • Season’s Greetings! From all of us at Pinnacle Healthcare Consulting!

    Pinnacle Healthcare Consulting Launches Strategy and Operations Division

    At this holiday season, our thoughts turn gratefully to those who have made our progress possible.

    We would like to personally thank you for your continued support and best wishes in 2014!

    Pinnacle Healthcare Consulting - Seasons Greetings 2013

    Continue reading →

  • Pinnacle Healthcare Consulting Wishes You a Relaxing Thanksgiving!

    cropped-pinnacle-healthcare-consulting-launches-strategy-and-operations-division.jpg

    Though a single day is set aside, the thankfulness is year-round.

    The Pinnacle Team is grateful for your friendship and business.

    Wishing you a relaxing Thanksgiving with friends and family.

     

    Pinnacle Thanksgiving

    Continue reading →

  • Visit Pinnacle Healthcare Consulting at the Fraud and Compliance Forum – Baltimore!

    Pinnacle Healthcare Consulting

    Visit Pinnacle Healthcare Consulting at the

    Fraud and Compliance Forum

    September 29-October 1, 2013
    Hilton Hotel
    Baltimore, MD
    Co-sponsored with the Health Care Compliance Association (HCCA)

    Program Description

    This program is designed specifically for compliance officers and health attorneys who must advise their clients and institutions on the latest developments in fraud and abuse and compliance issues. Attendees will hear from leading private practitioners and representatives from the Office of Counsel to the Inspector General, the Department of Justice, and the Centers for Medicare and Medicaid Services.

    Some of the cutting edge topics to be explored:

    • Assessing Fraud and Abuse Risks in Mergers and Acquisition Transactions
    • The CMS or OIG Self Disclosure Protocols – Which Is Right for You
    • Medicare’s Emerging Enforcement Tools: Revocations, Payment Suspensions and the CMS Fraud Prevention System
    • Compliance Across the Continuum of Care: Improving Quality and Avoiding Readmissions
    • Resolving Legal and Audit Issues in an Internal Compliance Investigation
    • The HITECH Rules are Here and We Need to be in Compliance: What Should you Be Doing?
    • Effect of Exclusion From Participation in Federal Healthcare Programs
    • Industry-specific Sessions for Hospitals, Home Health Providers, Life Sciences Companies, Long Term Care Providers, Managed Care Plans

    View the brochure.

    Luncheons

    The Fraud and Abuse Practice Group, will hold a luncheon and presentation on September 30.

    Title: A Conversation with Office of Inspector General Chief Counsel Greg Demske

    Faculty: Gregory Demske, Esquire (Presenter), Chief Counsel, Office of Inspector General, U.S. Department of Health and Human Services, Washington, DC, and William T. Mathias, Esquire (Moderator), Principal, Ober|Kaler, Baltimore, MD

    HCCA will hold a luncheon and presentation on October 1. Please note, there is an additional fee; pre-registration is required; space is limited.

    Program Materials

    We will not automatically be printing binders for everyone. All materials will be available on a website prior to the program and handed out on CD at the program. For those who still do want the binder they will be available for an additional fee; please order on the registration form.

    All registrants will receive an email a week prior to the program with a link to the materials. This website is for attendees only and is not posted to the public. You must have the direct link to the website. The email will come AHLA Member Services. To ensure registrants receive this email and is not caught by a spam filter, please white list msc@healthlawyers.org.

    Exhibitors

    View the Prospectus.

    About Pinnacle Healthcare Consulting

    Pinnacle Healthcare Consulting provides a range of strategic, financial and operational services to improve clinical and business performance for hospitals, health systems, physician groups and other healthcare organizations. Pinnacle Healthcare Consulting is a nationally recognized leader in business valuation, physician compensation, medical staff planning, performance improvement and compliance support. Other divisions of Pinnacle provide physician practice management, medical bill/coding, and technology/integration support services. Pinnacle’s array of specialized and highly responsive client services promote advanced innovation while our dynamic team solidifies strong client relationships and assists in solving your most complex challenges.

    Contact Pinnacle Healthcare Consulting Today – 303.801.0123 or kberkey@pinnaclegrouphc.com

    Visit: www.PinnacleGroupHC.com & www.PhysicianFMV.com

    Continue reading →

  • Pinnacle Team Member Highlight – Alianna Williams, Valuation Analyst

    Alianna Williams_2013_-_Our_Team

    Alianna Williams
    Valuation Analyst
    Alianna joined Pinnacle Healthcare Consulting in 2013. As an analyst, she supports Pinnacle’s health care physician compensation division. Alianna’s work contributes to fair market value analysis of professional service arrangements. She additionally provides market research, analysis of health care data, and detailed financial modeling. Her past work experience includes an internship at Morgan Stanley.  Alianna graduated from the University of Colorado Boulder with a double major in integrative physiology and economics with an emphasis in business. With a detail-oriented mind set and hard work, she was near the top of her class – even while working to finance her own education. From serving as a live-in caregiver for an elderly woman with Alzheimer’s to evaluating the impact of health care regulations and the economic influences – Alianna is passionate about helping people and the health care industry.

    Expertise
    • Physician compensation planning and analysis
    • Financial analysis, forecasting and modeling
    • Health care industry trends and policy research

    Education
    • BA, integrative physiology, University of Colorado, Boulder, CO
    • BA, economics with an emphasis in business, University of Colorado, Boulder, CO

    Interests
    • Skiing, fly fishing and enjoying Colorado’s outdoors
    • Cooking and enjoying good food
    • Traveling to new places

    Contact
    E-mail: awilliams@PinnacleGroupHC.com

    Phone: 303.801.0120

    About Pinnacle Healthcare Consulting

    Pinnacle Healthcare Consulting provides a range of strategic, financial and operational services to improve clinical and business performance for hospitals, health systems, physician groups and other healthcare organizations. Pinnacle Healthcare Consulting is a nationally recognized leader in business valuation, physician compensation, medical staff planning, performance improvement and compliance support. Other divisions of Pinnacle provide physician practice management, medical bill/coding, and technology/integration support services. Pinnacle’s array of specialized and highly responsive client services promote advanced innovation while our dynamic team solidifies strong client relationships and assists in solving your most complex challenges.

    Contact Pinnacle Healthcare Consulting Today – 303.801.0123 or kberkey@pinnaclegrouphc.com

    Visit: www.PinnacleGroupHC.com & www.PhysicianFMV.com

    Continue reading →

  • Visit Pinnacle Healthcare Consulting at HCCA’s Annual Compliance Institute!

    HCCA Annual

    HCCA Annual - Pinnacle Healthcare Consulting 2013

    About Pinnacle Healthcare Consulting

    Pinnacle Healthcare Consulting provides a range of strategic, financial and operational services to improve clinical and business performance for hospitals, health systems, physician groups and other healthcare organizations. Pinnacle Healthcare Consulting is a nationally recognized leader in business valuation, physician compensation, medical staff planning, performance improvement and compliance support. Other divisions of Pinnacle provide physician practice management, medical bill/coding, and technology/integration support services. Pinnacle’s array of specialized and highly responsive client services promote advanced innovation while our dynamic team solidifies strong client relationships and assists in solving your most complex challenges.

    Contact Pinnacle Healthcare Consulting Today – 303.801.0123 orkberkey@pinnaclegrouphc.com

    Visit: www.PinnacleGroupHC.com & www.PhysicianFMV.com

    Continue reading →

  • Pinnacle Healthcare Consulting Seeks a Health Care Business Valuation Analyst for its Rapidly Growing Health Care Business Valuation Practice!

    Employment Opportunity - Analyst - Pinnacle Helathcare Consulting

    Overview

    Pinnacle Healthcare Consulting seeks an Analyst for its rapidly growing health care business valuation practice.

    The Analyst will help develop analytical models, perform market analysis / research and support report letter development for advisory projects for both private and public entities in the health care industry.  These entities may be hospitals and health systems, physician groups, ancillary clinics, publicly-traded companies, etc.  This position offers professional growth to the motivated candidate.  This candidate will work closely with several team members and initially report to the Director of Business Valuation Services.

    The ideal candidate will possess bachelor’s degree in finance or accounting with a background in health care.  The candidate should possess strong organizational abilities to handle multiple projects and meet ongoing deadlines; demonstrate effective oral, written and interpersonal communication abilities; and a strong understanding and proficiency with Microsoft Excel. The candidate must be committed to staying at the cutting edge of health care regulations, financial / valuation best practices and ethical standards. Salary will commensurate with experience and market. Pinnacle offers a comprehensive benefits package including a 401k with an employer match.

    Responsibilities

    • Support an array of health care-related business valuation and transaction support projects, and consulting on financial arrangements between health care services entities.
    • Perform analysis of client data, including, but not limited to: physician productivity, practice / service line profit and loss information, industry structure and trends, economic factors impacting industry, impact of government regulations, etc.
    • Detailed financial modeling and report letter writing.
    • Thorough, accurate and timely documentation of all work.
    • Review of all work for validity, accuracy of data and professional presentation.
    • Demonstrate teamwork and accountability with project team members.
    • Stay current on business and economic developments relevant to firm and clients’ business; and use of latest technology and tools to enhance the effectiveness and efficiency of services provided.

    Qualification Requirements

    • Bachelor’s degree in finance / accounting with emphasis in health care.
    • Demonstrated aptitude in quantitative and qualitative analysis.  Technical valuations experience a plus.
    • 1-3 years experience in health care administration or consulting preferred.
    • Well-developed understanding of health care industry and in-depth understanding of health care data and methods of data analysis.
    • Ability to prioritize and manage concurrent projects, demonstrate initiative and work independently with moderate supervision.
    • Excellent analytical, project-management, communication, interpersonal, and team skills.
    • Advanced proficiency in MS Excel, Word, and PowerPoint.
    • Limited travel (less than 5%).

     About Pinnacle

    Pinnacle Healthcare Consulting, a member of The Pinnacle Group, provides a range of consultative services to hospitals, health systems, physicians and publicly traded companies. Pinnacle maintains a client network across the country.  For more information please visit www.pinnaclegrouphc.com.  Submit résumé and cover letter to kberkey@pinnaclegrouphc.com (please no phone calls).

    Continue reading →