Maywell × Total Ortho

The thesis in one paragraph

Total Ortho generates ~3,300–4,100 new spine patients a year (definition-dependent); only ~10.5% ever reach a pain physician, leaving a qualified pool of 1,535–1,800 pain-appropriate patients leaving the building annually. At their measured payer mix, that pool supports $1.2–1.4M at a conservative $2,000 commercial settlement and $1.5–1.7M at $3,500 — gated not by physician hours — the whole pool is ~6 procedure-hours/week at Dr. Mayrsohn's real throughput, and two-room access is confirmed — but by capture rate and coverage, with a second interventionalist (one is already in the wings) unlocking multi-site expansion.

Maywell is the capture engine: a growth-stage interventional practice — revenue up ~2.3× year-over-year ($530K in 2024 → $1.24M in 2025), ~$2.2M consolidated run-rate, margin suppressed today by an intentional staff buildout (25–30% normalized) — whose no-fault/WC/IDR billing muscle maps onto Total Ortho's leaking spine demand. The two halves fit — their captive demand, my capture capability.

Maywell momentum — revenue & new-patient growth

Monthly net revenue (cash P&L) and new patients acquired per month, Jan 2025 – Jun 2026 — built on essentially one interventionalist's hands.

Where the value is

Revenue by capture rate for the Total Ortho division — gated by capture, not physician hours.

Five things to land in the room

Collections ramp — net payments posted by month

Monthly net revenue from the cash P&L (ties to the unified billing book, merged master v5). May–Jun 2026 are understated by normal posting lag, not a real decline.

Payer mix

Share of collections across the full 3-year book (source-of-truth billing). No-fault + workers-comp ≈ 24% — the settlement/IDR lane that maps to Total Ortho's spine demand.

Top revenue lines

By net collected. E/M base + interventional procedural stack.

The capture funnel — from their own export

86,923 service lines, Jan 1–Jun 16 2026 (166 days), annualized ×2.20. Spine dx across both diagnosis columns.

What the July audit changed

We corrected our own numbers before the meeting — credibility first.

Their spine-patient payer profile (capture mix)

Measured from their export: no-fault + workers-comp ≈ 44%, plus ~21% self-pay/pending-lien. Settlement-heavy — Maywell's core competency.

Top Total Ortho providers by service volume (H1 2026)

From their export. Two are pain physicians — Burducea and Kooch. *Raw units include per-mg drug (J-)codes; Burducea's real interventional volume is ~2,550 units/yr — more than Dr. Mayrsohn's ~1,800 — a genuine capacity asset.

Pre-empting the CFO's sharpest question

"Isn't your 10% reach-pain rate understated — recent patients haven't had time to transition?" We tested exactly that. Using Total Ortho's own new-patient E&M / consult codes to define cohorts (not first-appearance, which double-counts returning patients), and adjusting for right-censoring via the mature-cohort lag curve, the eventual reach-pain rate triangulates to 10.5% — against 10.8% by the first-appearance method and 10.0% in the original model. The funnel input holds.

Cohort maturation — observed vs censoring-adjusted reach %

Code-defined new spine cohorts. May–Jun excluded (right-censored). Even at a paranoid 14%, the revenue floor stays inside $1.3–1.5M.

Surgeon → pain referral lag

Days from new-patient surgeon visit to first pain-physician visit, among patients who transition.

Where the leaking pool comes from — origin of new spine patients

Code-defined new spine patients (n=1,851). Referring-provider field is blank on 85% of lines, so treat splits as directional — but the direction is decisive.

Practice vs practice

How the two organizations stand next to each other — complementary, not competing.

Referral pathways — the strategic contrast

Two opposite engines that complete each other.

Maywell inbound network (external, built)

Top referral sources, all-time patients received. 190 orgs, hard-won relationship capital.

Total Ortho demand (internal, captive)

Self-generated spine demand vs the share that reaches pain.

Capacity is not the constraint — procedure-hours vs. the pool

Revenue by capture rate, and the procedure-room hours/week it actually takes. Even full capture needs only ~6 hrs/week — the limiter is capture rate and coverage, not the physician's hands.

Steady-state by settlement value

Demand-side: what the ~1,800 pool supports at full capture (capacity is available).

Contribution equity — Maywell EBITDA → their EV

Every $1 of consolidated EBITDA is worth ~$13 of enterprise value at their stated multiple.

Billing-pathway decomposition — where each revenue dollar comes from

The $3,500 settlement lever applies ONLY to the 22.6% OON-commercial share; NF/WC (~44%) rides statutory fee schedules + arbitration. Formulas track the measured payer mix.

Case-volume planning: Year-1 base ≈ 75 OON-commercial patients to negotiate settlements for (~187 procedures); with interventionalist #2, ≈187 patients (~468 procedures). NF/WC arbitration exposure rides on ~44% of procedures — the workload number for Angelo/RCM, distinct from the revenue number.

The native Athena AR report is now in hand — and it changes the diligence posture

This is the report we previously had to estimate (the de-ID AR workbook sent to Total Ortho was built from realization rates and flagged as an estimate). The real thing, pulled as of ~7/29/26: $6.52M gross charges outstanding across 4,806 open claims. Applying the same mature-claim realization rates used everywhere else in this brief, expected net cash from this book is ~$972K — which reconciles to the ~$1.2M collectible estimate we shipped (the delta is the estimate's payments-netting and its 180-day standard-payer write-off assumption). The estimate held up. Hand Total Ortho the native report and the reconciliation together — it converts a caveat into a credibility asset and closes one of their three open document requests.

The sharper internal finding: $3.93M — 60% of gross AR — sits in HOLD/MGRHOLD/CBOHOLD statuses, i.e. parked on our side of the fence, not awaiting payer action. That is the primary-data face of the ~$1M billing-underperformance thesis, and it is fixable with workflow, not payer negotiation.

Gross AR by age and payer group

Native Athena AR aging (as of ~7/29/26), aged from date of service. NF/MVA + WC + self-pay/lien lanes age long by design — arbitration and settlement timelines — so the >120-day bucket is structurally heavy (56.5% of total), not pure neglect.

Gross AR vs expected net, by payer group

Expected net = gross × the mature-claim realization rate for that payer class (Medicare 9.4%, Commercial 14.9%, NF 16.4%, WC 12.3%, Self-pay 23.9%, PI-lien 2.6%) — the same rates that drive every AR figure in this brief. Total expected net ≈ $972K.

Where AR sits in the workflow

Claim status on the gross book. HOLD + MGRHOLD alone = $3.89M — the internal-workflow lane. BILLED ($1.97M) is genuinely with payers.

Kept visits per month — the truest volume line

From the full 2025–2026 appointment detail (one row per scheduled slot; kept = scheduled − cancelled). Kept visits grew from ~500/mo (2025 avg) to ~756/mo (2026 Jan–Jul avg), 847 in July — this is the demand curve behind the revenue ramp, and it closes Total Ortho's scheduling/no-show document request.

Where scheduled slots go

Cancel reasons across 2025–2026. "Rescheduled" is churn, not loss. Scheduling error (1,040 slots) + provider unavailable (753) are internally controllable — that's front-desk process and calendar discipline, not patient behavior.

Booking funnel — every referral since day 1

Referral report as of 7/29/26. 2,631 referred patients ever booked a first appointment; 1,664 never did — a 61.3% booking conversion. 444 of the unbooked are <180 days old: the live recovery pipeline.

Booking conversion by named source — where the funnel leaks

Matched on the referral-detail field across both tabs (name variants consolidated). The headline: Jason Brown / CCC converts at 33% — 98 of his referrals never booked — while Quantum converts at 78%. Brown became the top physician referrer this year; fixing his intake lane is the single highest-leverage BD action on this page.

Defending the normalized margin with payroll data, not adjectives

The realized FY2025 net margin was ~6% — diligence will find it, so we lead with it. The brief's 25–30% is a normalization, and the payroll register (now in hand — another of their document requests, closed) is the strongest single piece of evidence for it: loaded W-2 cost was $702K against $1.24M collected in 2025 (≈57%), and is running ~$800K annualized against a ~$2.2M run-rate in 2026 (≈36%). That ~20-point swing is operating leverage already visible in the actuals — the 2025 margin was suppressed by hiring ahead of demand, and the cost base is amortizing exactly as the normalization claims. Founder under-compensation and one-time buildout spend are the remaining bridge items; the accountant quantifies those for the data room.

Labor cost vs revenue — the leverage in the actuals

Loaded W-2 payroll (gross + employer taxes) vs collections. 2026 payroll annualized from ~7 months actuals; excludes 1099s (nutrition, RCM, arbitration counsel) and owner draws — scope stated, not hidden.

Realized → normalized margin bridge

Each step is a claim with an owner: labor leverage is measured (payroll register); founder comp and one-time buildout are accountant-quantified before the data room opens. Present as a bridge, never as a measured margin.

Headcount & payroll register summary

From the payroll register (W-2 only). Name-level detail stays in the internal master file — this page carries aggregates.

Two-phase architecture

Phase 1 reversible operating partnership; Phase 2 pre-agreed merger at a formula valuation.

Anticipated CFO questions — your answers

Rehearse the first four. The audit findings are the credibility weapon.

What to ask them for

1. Their real enterprise value / PE multiple — drop it into the contribution-equity grid live. 2. Burducea's current procedural volume — confirms the interventionalist-#2 unlock. 3. Their exit timeline — earlier fold-in urgency is priced, not given away.

Maywell × Total Ortho — Partnership Analysis