Gain Control of Underperforming Assets & Improve Restructuring Results

Building modernized healthcare delivery platforms that yield better results

SCALE Company Overview

Illustrative Example of Sponsor + SCALE project team structure:

We believe that no single individual can adequately solve for all the variables that drive Physician Group performance – that iswhy our approach is to come with a village, an army of proven experts

The right resources + expertise can determine success or failure

Our team will work side-by-side with your investment professionals, augmenting & empowering your diligence and post-close processes

SCALE clinical services SCALE practice operations and management

SCALE is exclusively focused on studying, building and institutionalizing Physician Group best-practice

Core Specialty

Pathology Radiology

PharmaPhysicaltherapy

Infusion

Payor Contracting HR

Talent Recruitment

ITRevenue

Cycle Management

Marketing

Manager/Board Advisor

Analyst

TargetPhysician Group

partner

spo

nso

r investm

ent team

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Every interaction with a Physician Group presents an opportunity to compare and analyze what works across a range of management disciplines and clinical specialties as we seek to continuously perfect our

scaling algorithms

The SCALE network:Compounding crowd wisdom

SCALE identifies, institutionalizes and shares pockets of best-practice from Physician Groups nationally

Clinical specialtiesService offering portfoliosGrowth and integration strategies

Geographic focus and expansion Physician practice and MSO ownership structuresPhysician compensation structures Staffing ratios, physician recruitment strategies, mid-level utilization

Payor contracting strategiesOperational domain performance

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Our takeaways from each engagement help drive increased value-add and better performance results across our broader client portfolio

Practice

Practice

Practice

PracticePractice

Practice

Practice

Practice

Practice

Practice

Practice

Practice

Practice

Practice

Practice

Practice

Practice

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SCALE’s service platform addresses critical gaps in alternative market offerings

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Single Domain Consultant

Generalist Consultants

Private Equity Operating Partner

MSO Management Team

Provider Platform Expertise Coverage

Niche Domain Deep Expertise ✓ ✓(narrow focus) Varies ✓(narrow focus) ✓(narrow focus)

One-Stop Shop (Clinical Specialty + Ancillary + Operational Expertise)

✓ × × × ✓(narrow focus)

Market Focus

Exclusively Provider Platforms ✓ ✓ × Varies ✓

Up-to-Date National Best-Practice Exposure Across Multiple Specialties

✓ Varies ✓ × ×

Both Private Equity & Independent Platform Experience

✓ Varies × Varies Varies

Role Capabilities

Long-Term & Co-Invest Interest ✓ × × ✓ ✓

Strategy Development / Board Advisory ✓ × × ✓ ✓

Independent Third-Party Department Review

✓ ✓ (narrow focus) Varies × ×

On-Going Execution Advisory Oversight ✓ Varies Varies – generally no × ✓

Outsourced Solution Offering ✓ Varies Varies – generally no × × 5

SCALE’s execution principles

Thoughtful Execution Plan

• Begin with the end goal: Invest in a thoughtful analysis of where we want to be, work backwards to develop structured execution plans that bridge between current and target future states

• Organized communication: Interim performance and execution status clarity, structured communications channels and managed expectations

• Execute on a portfolio of initiatives: Focus on overarching organizational success vs. specific initiative success; leverage realized “wins” in one initiative to drive execution momentum across the organization

Balanced Portfolio of Execution Resources

Achieving execution results requires a balanced portfolio of execution resources and skillsets: expert advisory + holistic project management + practical solutions + execution resources = tangible results• Seasoned executive advisory • Hands-on project management • Comprehensive stable of technical domain expertise • Well-resourced pool of execution support resources

Strong Execution Culture

• Build upon “wins”: Forward momentum, results-oriented • Persistence, show vs. tell approach: New initiatives often take bandwidth and time to develop. Our team does not let

go of an initiative until it “catches” with internal management and becomes embedded in the Company’s DNA.• Management team partnership: Emphasis on patience, flexibility, support and collaboration • Efficiency: An ineffective meeting or initiative is a hidden cost – i.e., aim to run the fast break without the ball touching

the floor

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SCALE’s execution principles

Advisory / Light Execution Support

Heavy Execution Support

Full-time, Outsourced or Special Project

Leadership

Executive Partner (with relevant C-Suite

experience)

Project Management

Operational & Clinical Service Line Technical

Teams

Analytics & Execution Support Resources

• Comprehensive range of utilization models: From advisory and execution oversight to part-time, full-time & outsourced execution leadership• Flexibility to adjust team composition and utilization levels as strategic objectives and priorities evolve

Customized project teams and utilization models designed to meet client-specific needs

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SCALE Restructuring Service Overview

Underperforming Assets Are Consistently Correlated With Key Recurring Themes

▪ Opaque, lagging and superficial performance reporting & analytics

▪ Reactive management decision-making & delayed Board intervention

▪ Avoidance of logical pathways out that require meaningful change or heavy lifts

▪ Limited stress testing of management plans by qualified domain expert peers

▪ Overwhelmed management teams due to insufficient leadership bandwidth and feeling the burden of not knowing “the answer”

Common Themes Across Underperforming Assets

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▪ MSO service offerings that fail to pass the “value add” test

▪ Subpar physician satisfaction & communications

▪ Stale business strategy & market focus that is failing to keep pace with evolving market dynamics

▪ Ambiguous team culture fueled, in part, by weak add-on integration programs

▪ Flawed core principles; focus on:o Growth in sites / physicians vs.

growth in profito Any relationship vs. durable

relationships o Appeasing everyone vs.

delivering high quality service

▪ Reliance on overly rosy projections

▪ Excessive historical leeway provided in selection of & execution on costly growth / experimental initiatives

▪ Material gaps in accrual revenue vs. cash collections

▪ MSO service offerings that are materially over- or under-charged

▪ Excessive MSO debt

▪ Mixed portfolios with pockets of material underperformance – i.e., sites, providers, service-lines – that need to be unpackaged from areas of stronger performance

Management & Board Decision-Making Financial PerformanceValue Proposition

When Dealing With Underperforming Assets, Time is CostlyEffectively Navigating a “Crisis” Requires Reacting Quickly & With Sufficient Resources

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Augment Performance & Execution Status Clarity

Implement Solutions That Offer Near-Term Relief

Define Reorganized Company’s Strategy and

Growth & Development Plan

Immediate Execution Immediate Planning, Mid-Term Execution

Scale’s Tailored Project Team Addresses Core Areas of Underperformance Efficiently & Effectively

Scale Domain Advisor Second Opinion▪ Leverage Scale’s domain advisors for a second

opinion on clinical service line and operational strategy & performance

Scale Project Management & Analytics• Build analytics programs that summarize

baseline performance and highlight areas of opportunity & acute underperformance

• Define and quantify target near-term initiatives

• Implement Scale’s restructuring KPI dashboard to facilitate stakeholder alignment on priority focus areas and transparently track status on key restructuring initiative results

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Scale Project Management• Oversee & support execution of near-term

restructuring and performance improvement initiatives o As appropriate, serve in interim

management roles or support new leadership talent sourcing

• Build & manage execution look ahead trackers to facilitate status clarity and accountability

• Meet with key stakeholders to communicate performance, anticipated business changes & strategic rationale for the same

Scale Analytics• On-going analytics to interpret evolving

circumstances and initiative results

Scale Domain Advisors• On-going technical domain advisory,

oversight and execution support

Scale Domain Advisors, Project Management & Analytics• Develop a target reorganized company

business plan, including pro formao Value proposition offered to key

market stakeholders

o Portfolio of clinical services

o MSO service scope and pricing

o Organic & inorganic growth execution plan and sequencing

o Target prospect / acquisition target “scorecard”

o Payer strategy and strategic partnership opportunities

o Potential future buyer landscape

o Management team and infrastructure required to execute

Augment Performance & Execution Status Clarity

Define Reorganized Company’s Strategy and Growth & Development Plan

Implement Solutions That Offer Near-Term Relief

Select Turnaround Engagement Results

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Engagement 1(Women’s Health)

Select Key Initiatives Select Key Results

• Employed provider restructuring• Finance department restructuring• Managed lender discussions• Took over revenue cycle department

• Achieved cash flow profitability within three months against initial cashflow negative results.

Engagement 2(ASC Management)

• Developed restructuring business plan• Supported a transition of the entire C-Suite

team• Developed & implemented Board,

management team and restructuring-specific executive summary reporting & analytics

• Approximately 15% increase in EBITDA achieved through realized cost savings

• Accelerated cash cycles for working capital needs through aged lien A/R factoring

• Ended two on-going acquisition processes for risky assets

Engagement 3(Multispecialty/Vascular)

• Employed provider restructuring• Provider scheduling and utilization

restructuring • Coding oversight program augmentation • Physical site & select clinical service line

closure• Took over revenue cycle department • Supported implementation of new clinical

service lines that generated incremental revenue streams

• Breakeven performance within eight months against initial cashflow negative results

SCALE Physician Group at a glance

Physician Groupengagements

Our partners represent a broad network

Providers across our partners

States our partners operate across

Service line andoperational solutions

offered by SCALE

18 1,410 15 42

Healthcare companiesfounded by our team

Exits from healthcarecompanies our team

has led

Healthcare c-suite rolesour team has held

Healthcare private equity funds our team has advised

(operating partner)

30 25 107 +30

Our team’s extensive and diverse expertise

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Select Leveraged Loan Providers SCALE Has Worked With To Date

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SCALE partners

*Completed engagement

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What our clients say

SCALE is a valued partner to sponsors

“I have been thrilled with the work Scale Physician Group has done for us on multiple healthcare platform bids. Their in-depth diligence reports on specific initiatives always gives us a competitive advantage over our competition. We look forward to our continued partnership with the Scale Team.”

Andrew MaroldaManaging Director and Co-FounderThe Beekman Group

“Scale’s thorough market research, management presentation participation, and MSO formation and best practice analysis added a valuable additional layer of strategy and operational insight that helped us make the best decisions for our firm across multiple deals. The quality and depth of Scale’s work augmented our deal execution process.”

Anonymous

“Scale Physician Group has been a valued and complementary partner to our investment professional team throughout our physician platform acquisition process. Scale’s analysis of a diverse range of operational, service line and growth initiatives provided us with a uniquely efficient channel for holistic operational scaling execution diligence conducted by a highly experienced team of professionals, as well as enhanced clarity on key post-close

business plan initiatives. We look forward to our continued work with Scale.”

Anonymous

“

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SCALE’s deep bench of seasoned & diverse healthcare expertisePlatform development & operations execution team

Suniti Ponkshe

Chief Advisor, Payor Contracting Strategy

Robert Trenczer

Chief Advisor, Revenue Cycle Management

Sandy Seay

Chief Advisor, Human Resource Solutions

Kylie Luff

Senior Advisor, Human Resource Solutions

Daniel Maimin

Chief Advisor, Marketing Strategies

Jason Schifman

Co-Founder & President

Jack Trunz

Analyst, Platform Development

Roy Bejarano

Co-Founder & CEO

Bill Ingram

Vice President, Platform Development

Jeff Kahn

Chief Advisor, Human Capital Management

David Kovel

Chief Advisor, IT & Data Strategy

Mike Mirt

Chief Advisor, Executive Payor Strategy

Rob Popdan

Analyst, Platform Development

Dr. Steven Merahn

Head of Content Strategy

Jack Carrier

Associate, Platform Development

Susan Silhan

Vice President, Marketing

& Communications

Tracy Bahl

Operating Partner, National Payor Strategy

Ernest A. Varvoutis, III

Operating Partner, Hospital Systems

Jonathan Kron

Operating Partner, SCALE Europe

Jatinder Garcha

Vice President, Platform Development, SCALE

Europe

Parbinder Kaur

Vice President, Platform Development, SCALE

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SCALE’s deep bench of seasoned & diverse healthcare expertiseClinical service line advisor team

Bob DeCresce

Chief Advisor, Pathology

Gilbert Leistner

Chief Advisor, Telehealth & Telemedicine

Thomas Petrone

Chief Advisor, Radiology & Radiation

Oncology

Michael Reed

Chief Advisor, Primary Care, Medicare Advantage, ER

Staffing and Hospital Physician Services Programs

David Reese

Chief Advisor, Infusion & Pharma

Services

James Usdan

Chief Advisor, Dental Provider Platforms

& Physical Rehab

Keith F. Safian, MBA, FACHE

Chief Advisor, Healthcare System

Strategy

Larry Crist

Chief Advisor, Urgent Care

Charles Trunz

Chief Advisor, Hospital Relations

& Urgent Care

Dave Fitzgerald

Chief Advisor, Orthopedic

Provider Platforms

Richard Loewenstein

Chief Advisor, Behavioral Health

Platforms

Janice Pyrce

Chief Advisor, Behavioral Health

Platforms

Marcello Celentano

Chief Advisor, Ophthalmology

Provider Platforms

Steve Straus

Chief Advisor, Ophthalmology

and Dermatology Provider Platforms

Adam Nielsen

Chief Advisor, Home, Health

& Hospice Platforms

Chad Eriksen

Chief Advisor, Clinical Research

William Hughson

Chief Advisor, Fertility & Dialysis Provider Platforms

Sean Mullen

Chief Advisor, Vascular Platforms

Dr. Warren Melamed

Chief Advisor, Dental Provider Platforms

Laurie East

Chief Advisor, Pediatric Provider

Platforms

Steven Graubart

Chief Advisor, Micro Hospitals and Operating

Partner, Texas

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