Private equity firms are under pressure to protect margins in a tighter market. Traditional levers are harder to pull, and leadership needs faster ways to improve financial performance.
For this portfolio of self-storage and car wash businesses, healthcare was a significant, recurring expense without clear visibility into what was driving cost.
This lack of clarity reached a breaking point in 2024, when total healthcare costs climbed to nearly $6M.
Parasol Health introduced a more structured approach focused on cost visibility and control. The key shift was breaking total spend into decision-ready components: fixed costs, current-year medical and pharmacy claims, and prior-year runout.
Combined with governed pricing and structured cost containment, this allowed leadership to evaluate performance based on current activity, not past liability.
Despite stable enrollment, overall costs declined:
$797K in prior-year runout claims, representing approximately 22% of total 2025 cost
39% reduction in overall spend
A meaningful share of 2025 spend was tied to prior-year liability, not current performance, giving leadership a clearer view of true cost drivers.
The result is a clearer, more controllable cost structure that supports better forecasting and stronger margin performance across the portfolio.