Faced with increasing challenges to their business model, many academic medical centers (AMCs) are seeking new sources of financial and competitive advantage, including partnerships with community health systems. These arrangements can be difficult to structure, but eight lessons can help AMCs avoid pitfalls and maximize the odds of success.
Topic Scale & M&A
Historically, larger scale has offered hospital systems a number of advantages; however, reform and other market changes are altering the scale equation for hospital systems.
Whether scale brings competitive advantage to payors is a topic of hot debate. This post challenges standard assumptions about scale and sheds light on how to achieve desired value.
Regulatory changes and the economic recession have disrupted the U.S. healthcare industry, threatening to erode the advantages of market leaders. As many payors turn to M&A strategy, its imperative for them to understand the inherent risks and the factors that guide M&A success.
This series of articles examines transformational imperatives specific to health systems in the post-reform era, drawing on extensive work with healthcare stakeholders across the value chain.
Given today’s realities, health systems must look beyond the traditional economies of scale if they want to reap the full benefits of M&A. They must consider other economies that M&A can offer, commit themselves fully to the effort, and execute flawlessly.