(A warm welcome to guest blogger Jim Hosking)

Merger mania is here to stay! Maybe your organization has been through a merger and you survived, well keep looking around the corner, it may be shortsighted or wishful thinking.

In today’s world, mergers are not just between two hospital systems, but involve all aspects of the healthcare industry;

• Suppliers and payors (I.e., CVS Health/Aetna)
• Individual providers and systems
• Small physician groups into larger groups
• Systems with systems (I.e., Advocate Healthcare/Aurora Healthcare).

According to a recent PricewaterhouseCoopers (PwC) industry report, mergers and acquisitions Increased 145 % to $175.2 Billion in 2017. As a C-suite executive or senior level director of facilities in a hospital, these numbers are enormous. Will this impact you and if so, how can you be prepared?

As organizations enter merger discussions or initial due diligence research, data is king! The entire organization leadership team will receive numerous information requests. The following provides a short list of items to name just a few:
• Costs
• Processes
• Systems
• Staffing
• Competition
• Market conditions
• Financial obligations/debt
• Facilities
• Equipment
• Inventory
The goal is to understand the current situation and identify potential cost savings, future investment opportunities and any other special circumstance that will need to be addressed by the acquiring entity. Obviously, the existing leadership team will be evaluated during the process. Who will be retained or lead the consolidated operation? Existing leadership needs to be prepared to make the cut.
Typically, a facility director or vice president of facility/construction will be asked to provide information about current facility conditions. A well-prepared organization should minimally have immediate access to the following type of information;
• Up to date information on state and federal surveys
• “As Is” site and floor plans
• Age and condition reports of all buildings
• Space inventory by department
• Engineering survey
• Master site and facility plan
• Annual capital budget
• Physical plant/medical equipment age and replacement schedule
• Property acquisition plan

Although many organizations have bits and pieces, most do not have sufficient data readily available or up to date! This is problematic not only for mergers and acquisition, but more importantly, day to day operational and strategic decision making is made on incomplete information.

A comprehensive master plan will address these data needs and assure the facilities portion of a merger data request will be available. Keep in mind, the master plan only represents a snapshot in time and must be updated regularly (every 3 to 5 years). In the interim period, changes to space assignments, equipment updates, renovations and property changes should be documented as they occur.

As in any industry today, current and timely data is important for decision making. The leadership teams who ensure that it is accurate and readily available will be successful and rewarded!

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Steve’s career in architecture, construction and development, always remained focused on the enormous potential and challenge of fully integrated project delivery.

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