Monday, June 11, 2012

Acquirers Seek High Performing Medical Groups

Healthcare M & A

As the economy picks up, Healthcare M & A activity has increased markedly. The trend is accelerated by an emerging consensus that pending changes in payment models necessitate "strength in numbers". According to AxialMarket.com, "...within the Health Care industry in the United States and Canada in 2011...Health Care accounted for 9% of overall network activity and experienced a 96% increase in deal flow in Q4."

On April 27, Bob Wilson, a Managing Director at Grant Thornton, presented on transaction and integration issues as they relate to healthcare company mergers and strategic partnerships. He spoke at the annual FICPA Health Care Industry Conference in Orlando and placed particular emphasis on the Elements of High Performing Medical Groups. Potential suitors are obviously trying to identify these elements as they search for acquisition targets and partners.

Mr. Wilson named the following Group Practice Essentials:

Operating Performance
  • Operating Efficiency
  • Medical Management
  • Physician Activities
  • Patient Access & Throughput
  • Cost Structure
  • Revenue Cycle
Infrastructure
  • Governance
  • Management
  • Policies & Procedures
  • Technology
In addition, he stressed that a high performing Culture must be pervasive throughout the organization. Those practices seeking a buyer or partner would be well served by developing and showcasing their high performance metrics.

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