Challenge Solver — SPARROW SPECIALTY HOSPITAL
Reverse solver: what breaks the deal?
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$1.0M
Target EBITDA Drag
4
Assumption Sets Found
Reverse Challenge: What Hits the Target?
Shows what KPI assumptions would need to be true to produce the target EBITDA drag. Useful for IC presentations: "the deal fails only if denial rate exceeds X%."
| Assumption | Current | Required | Gap |
|---|---|---|---|
| Denial rate rises to 0.0% | 0.02 | 0.03 | 0.01 |
| AR days increase to 36 | 25.88 | 36.24 | 10.35 |
| Collection rate drops to 88% | 95.00 | 88.00 | 7.00 |
| Patient volume declines 12% | 0.00 | -0.12 | 0.12 |
What This Means
IC talking point: "The deal fails only if ar days increase to 36. We believe this scenario is unlikely because [your thesis here]."
Use this analysis to frame the downside case in your IC memo. See denial drivers for root cause analysis and pressure test for stress scenarios.