The Challenge
A health insurer was losing money and struggled to improve due to the lack of a dedicated financial team.
The Solution
A Florida CFO Group partner was appointed as the interim / project CFO. The partner built the financial function and analyzed operations. Many improvements were made. Losses were primarily caused by reimbursement rates set below the cost of services by the state. Faced with bureaucratic indifference, the ownership group sought strategic alternatives.
The Implementation
The Florida CFO Group partner worked with the Board of Directors of the ownership group to bring the company to market with a focus on critical intangible assets including customers and a broad service provider network. The partner assisted with negotiations, buyer due diligence, and closing the sale to a public health insurance company.
The Results
The not-for-profit business that owned the health insurer realized cash from the sale that exceeded two times their annual receipts, which they invested in new health clinics in low-income communities in Florida. In addition, the industry group that the insurer had participated in won its lawsuit against the state agency, leading to another seven-figure disbursement that further funded healthcare operations.