Before finalizing any deal to acquire a physician practice, the strategic, financial, operational, legal, and regulatory ramifications must be adequately addressed. P. Anthony Long, Senior Vice President, and William Cherry, Vice President, Paragon Health, offer the following tips for ensuring a successful—and sustainable—acquisition.
By P. Anthony Long And William Cherry
Over the last couple of years many hospitals and health systems have taken advantage of the numerous opportunities to purchase a primary or specialty care practice. Although the opportunity may be appealing, success is not guaranteed. Acquiring a physician practice goes beyond simply agreeing on a fair purchase price. Before any deal is finalized, there are critical questions surrounding strategic, financial, operational, legal, and regulatory ramifications that must be discussed by the key decision-makers. Not doing so sets up any new enterprise for failure. Here are several factors to consider before signing on the dotted line:
Regardless of your hospital’s specific integration model, hospital-owned physician practices must adopt a more disciplined approach to strategic planning to ensure future success. Key considerations include establishing the future value of the practice enterprise, sustaining the long-term viability of the practice, supporting the success of the enterprise and achieving hospital-wide business objectives. The following points outline best practices for a successful strategic planning process.
By Robert C. Moss – Executive Vice President, Paragon Health
Exit planning is all about how and when you get out of your current business model – or transition to the next iteration of your strategy. Exit planning is a powerful tool in your strategic planning arsenal, but few use it to its full potential. In this article, we want to give you some basic concepts you can use to gleen some of the benefits of exit planning.
By Tom Freeman, VP, Paragon Health
As more and more hospitals and healthcare systems decide to employ Cardiologists and acquire Cardiology practices, it soon becomes apparent that the financial ramifications are not always as expected. In most cases the bottom line for the Hospital’s Cardiovascular Enterprise increases, due in part to the increased ancillary revenue that the hospital obtains. However the practice itself has become just another “cost center” in the hospital and the bottom line is rarely positive and, in certain situations, can be a very large negative.
