PE Operational Due Diligence

The operational picture
your financial diligence misses.

Healthcare-specific operational due diligence that quantifies the transformation opportunity, identifies embedded inefficiency, and delivers a value creation thesis with EBITDA attribution — the metrics investment committees expect.

5–7
Day Quick Screen
3–4
Week Full ODD
$10M–$50M
Target Enterprise Value
National
Geography
The Gap

Financial diligence tells you what. We tell you why.

Standard financial diligence surfaces the numbers. It doesn't tell you why the revenue cycle is leaking 12% to denials, why staffing costs are growing faster than patient volume, or whether the EHR system can support the add-on acquisition strategy.

We provide the healthcare-specific operational layer: payer contract analysis, reimbursement risk assessment, staffing model evaluation, revenue cycle integrity, compliance posture, and digital maturity scoring — the diligence that prevents post-close surprise.

What We Assess
Payer Mix & Contract Analysis
Panel intelligence, carrier scoring, reimbursement risk, and contract renewal exposure.
Revenue Cycle Integrity
Clean claims rate, denial management, prior authorization cycle time, and billing leakage quantification.
Staffing Model & Operational Leverage
Friction Coefficient baseline, physician value intelligence, and headcount-to-revenue ratio analysis.
Digital Maturity & Automation Opportunity
46-metric scoring across five domains. Quantified transformation opportunity tied to EBITDA impact.
The Core Metric

The Friction Coefficient becomes a key input to the investment thesis.

The ratio of headcount growth to revenue growth. It tells you whether a target's operational model scales — or whether every dollar of growth requires a proportional dollar of labor.

Above 0.8 means the organization is in the Linear Scaling Trap. Below 0.5 means it scales. The gap between current state and target state is your EBITDA expansion opportunity — quantified, with a roadmap attached.

See the Full Methodology →
1.15
Typical pre-acquisition
0.42
Post-transformation target
+18%
Revenue / employee
−34%
Cycle time
+6.2
Margin pts
Engagement Structure

From quick screen
through value creation.

Phase 01

Quick Screen

Rapid operational assessment for deals in early diligence. Friction Coefficient estimate, payer mix overview, and top-line risk identification. Designed for go/no-go decisions.

5–7 days
Phase 02

Comprehensive ODD

Full operational due diligence: process mapping, Friction Coefficient baseline, digital maturity scoring, staffing model analysis, revenue cycle audit, and transformation opportunity sizing with EBITDA attribution.

3–4 weeks
Phase 03

Value Creation

Post-close execution of the value creation thesis. Five-phase roadmap, sprint-based implementation, quarterly performance reporting aligned with PE reporting cycles. EBITDA expansion tracking through hold period.

Ongoing post-close
Value Creation Timeline

From diligence through exit.

The ODD findings convert directly into a value creation execution plan. Quarterly performance reviews align with PE reporting cycles. The language is ROI, payback periods, and EBITDA attribution.

Pre-close
Operational Due Diligence
Friction Coefficient assessment · digital maturity scoring · risk identification
Day 1
Friction Coefficient Baseline
Process mapping · hidden labor cost quantification · opportunity prioritization
Months 1–9
Process Automation Sprints
2–4 week builds · measurable ROI at each sprint · quarterly IC reporting
Months 6–18
AI Integration & Scaling
Predictive systems · compounding competitive moats · multiple expansion drivers
Exit
EBITDA Expansion Realized
Margin expansion + revenue acceleration + multiple expansion
Deliverables

What your deal team receives.

Every deliverable is designed for the audience that reads it — deal partners, operating partners, investment committees, and portfolio company management.

Operational Due Diligence Assessment

Full assessment output with Friction Coefficient, digital maturity score, risk identification, and transformation opportunity sizing with EBITDA attribution.

Value Creation Thesis & Roadmap

Executive-level strategic plan with prioritized initiatives, business cases, implementation timeline, and projected EBITDA impact. Board and IC-ready.

Digital Maturity Scorecard

One-page executive summary positioning the target across five metric domains, benchmarked against healthcare industry peers.

Quarterly Performance Dashboard

Ongoing monitoring tracking all active metrics against targets, with trend analysis, ROI validation, and next-quarter recommendations. Aligned with PE reporting cycles.

Ideal Profile

Who this is for.

Middle-market PE firms ($100M–$2B fund size) with active healthcare deal flow. Multi-clinic, dental, behavioral health, and primary care platforms. $10M–$50M enterprise value targets.

We're built for firms that recognize operational leverage as an EBITDA driver, not just a cost line.

Active Deal in LOI or Diligence

Quick Screen (5–7 days) provides go/no-go operational assessment for deals in motion.

Platform Strategy (Buy-and-Build)

ODD framework designed for multi-site complexity. Integration readiness assessment for add-on acquisitions.

Post-Close Operational Surprise

If a prior deal uncovered operational issues post-close, the pain creates urgency for ODD on the next transaction.

Operating Partner or VP Ops in Structure

Firms with dedicated operational resources are the strongest fit — they have the infrastructure to execute the value creation thesis.

Connected Services

ODD findings create the next engagement.

During Diligence

Insurance Alignment

Payer mix analysis routinely reveals $400K+ in uncollected revenue from panel gaps and contract misalignment.

Learn more →
Post-Close

Management Consulting

Value creation execution: process redesign, automation implementation, and organizational optimization from the ODD roadmap.

Learn more →
Day 1 Revenue

Remote Patient Monitoring

RPM enrollment captures new revenue immediately post-close. Turn-key program through our subsidiary, Digi-Health Tech Solutions.

Learn more →
Common Questions

Before you
engage us.

How is this different from a QofE provider?

Quality of Earnings tells you what the numbers are. We tell you why they are that way — and what the numbers could be post-transformation. Our Friction Coefficient, digital maturity scoring, and 46-metric framework quantify the operational leverage opportunity that QofE providers don't assess.

What does the Quick Screen cost?

We scope pricing in the initial conversation based on target complexity and data availability. The Quick Screen is a fixed-fee engagement designed to fit the pace and economics of active deal processes. No surprises.

Can you work within our diligence timeline?

Yes. The Quick Screen (5–7 days) is built for active deal timelines. The Comprehensive ODD (3–4 weeks) runs in parallel with financial diligence. We've never missed a close date.

Do you work on non-healthcare deals?

Healthcare is where our data advantage and methodology are deepest. Our Digital Transformation framework applies across industries — oil and gas, banking, professional services, manufacturing — but healthcare ODD is the engagement type where we deliver the most differentiated value.


Active deal? Let's talk
before the LOI signs.

The earlier in the process we engage, the more value we surface. Quick Screen results in 5–7 days.

Schedule Your Consultation
$100M–$2B fund size Healthcare-focused National