Medical Transportation Services

Company Overview

Medical Transportation Services - The Company provides emergency and non-emergency medical transportation services, including ground and air transport to a variety of patients.  The Company also provides 9-1-1 call center services for municipalities and fire protection districts on a contract basis via its state-of-the-art call center.  The Company had grown rapidly over the years, employing more than 1,500 people and generating annual revenues of almost $90 million.

Engagement Overview

The Company's rapid growth and entry into new service offerings and geographical markets, caused a variety of issues leading to significant losses and lack of liquidity, which resulted in defaults on its loan agreement.  In the year prior to our engagement, the Company lost more than $4 million and had negative EBITDA, before accounting for its significant debt-service payments.  The Company was forced to borrow from relatives to meet its obligations.


Some of the key issues facing the Company included A/R days sales outstanding, which had increased dramatically, operating costs and Cap Ex, which were growing faster than volume, and its management team that was stretched too thin. 


Fort Dearborn Partners was retained to develop a plan to return the Company to sustainable profitability, and to assist with lender negotiations to increase availability and extend its credit facility, which was in default.  Working closely with management and the owner, FDP:

•  A/R:  developed revised billing and collection procedures, replaced the department manager and retrained entire staff, resulting in significant cash flow improvement
•  Developed and implemented price increases for services that were previously unprofitable

•  Operations:  COO was replaced and staffing models were revised leading to improved utilization rates and $4 million of annual savings

•  Convinced the owner to hire the Company's first CFO, thereby reducing outside accounting fees, generating an immediate payback



After implementing Fort Dearborn's plan, the Company has returned to profitability:

•  Revised Staffing methodology and Operational changes resulted in $4 million of annual cost savings.
•  Implementation of price increases and improved billing and collections practices has dramatically improved cash flow.

•  Captive insurance and leasing entities are now properly funded.

•  Availability under the line-of-credit improved by more than $2 million.

•  New CFO was hired.

•  Successfully negotiated loan extension with increased borrowing availability and revised covenants based on the forecast.