There are many forces that have driven healthcare mergers and acquisitions over the years. One constant has been the need to access capital to fund critical strategic initiatives, acquire major clinical technologies, improve information technology systems, update aging physical plants and invest in needed service and program expansions. The result has been an increasingly consolidated profile for healthcare providers.
In today's contemporary and rapidly evolving healthcare environment, new forces are coming to bear on organizations that undoubtedly sustain and accelerate the movement towards ever-larger healthcare delivery organizations. They also reflect the evolving priorities healthcare provider organizations must address as they look ahead. New forces driving healthcare mergers and acquisitions now include:
As the forces reshaping healthcare continue to expand, more healthcare delivery organizations will find a merger or acquisition to be an inevitable part of their future.
Steve Gelineau is senior vice president at The Camden Group's new Boston office. For more information, call (978)317- 7432 or email sgelineau@thecamdengroup.com.
In today's contemporary and rapidly evolving healthcare environment, new forces are coming to bear on organizations that undoubtedly sustain and accelerate the movement towards ever-larger healthcare delivery organizations. They also reflect the evolving priorities healthcare provider organizations must address as they look ahead. New forces driving healthcare mergers and acquisitions now include:
- The need for scale to be able to participate successfully in value-based and at-risk contracting. Objectives here often include the effective mitigation of financial risks posed by small patient populations; building expertise in contract structuring and management; and acquiring clinical leadership to drive value-based models.
- The pursuit of cost efficiencies through the combination of administrative, support and clinical programs. As annual payment gains shrink (or disappear altogether) for providers, there will be further pressures to reduce operating costs. As entities combine, they can often realize substantial cost-savings.
- Achieving quality gains in targeted clinical service lines through focused system-wide efforts, the combination of patient populations and care resources, and by deepening the clinical portfolio and care capabilities of the combined enterprise.
- Accessing infrastructure capabilities such as IT, contracting, physician practice models, management capability and clinical leadership.
As the forces reshaping healthcare continue to expand, more healthcare delivery organizations will find a merger or acquisition to be an inevitable part of their future.
Steve Gelineau is senior vice president at The Camden Group's new Boston office. For more information, call (978)317- 7432 or email sgelineau@thecamdengroup.com.
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