Membership substitution transactions are the most common form of business combination transaction in the nonprofit hospital industry. They are also widely misunderstood and the source of many mistakes. Many large 501(c)(3)s have become more acquisitive as a result of economic pressures of the ACA.…
In its 2010 Governance Institute white paper, Juniper Advisory described the ownership structure of the hospital industry in anticipation of the impact of healthcare reform and the Affordable Care Act (ACA) on hospital consolidation.¹ Leading up to enactment of the ACA, health policy experts had concluded that the U.S.…
The decision to align with another health care organization is among the most important, if not the most important, undertakings for a hospital board. Selecting the right partner, strategy, timing and structure all play important roles in determining the ultimate success of an organization and a partnership.…
The European Union is an affiliation. Unlike a federal government, the United States for example, where members combine into a single sovereign nation, each member state of the EU remains independent. The EU member countries gain a measure of collective strength and influence by ceding control over certain decisions, regulations and institutions to a central authority, but they remain sovereign and free to exit.…
As the delivery of health care continues to evolve and hospitals bear additional pressures to adapt to new payment models, more nonprofit hospitals are partnering with for-profit providers, through a sale, joint venture, or other arrangements.
Partnerships between independent nonprofit hospitals and larger health care systems (nonprofit and for-profit) have been growing over the past two decades.…
In its final season, “Downton Abbey” captured audiences by exploring a healthcare phenomenon set in rural England 100 years ago — and one still playing out across America today.
The phenomenon is hospital consolidation, and historical period drama “Downton Abbey” tackled it with the same gusto with which it took on the deterioration of class hierarchies, the emergence of the women’s liberation movement and many other social issues over six critically acclaimed TV seasons.…
Independent hospitals and small health systems face a daunting challenge in developing their healthcare IT capabilities to meet the requirements of value-based care. But they must carefully weigh their options and proceed cautiously in meeting that challenge.
Health systems that lack the financial wherewithal to develop an electronic health record system on their own, and that are seeking an alternative strategy, should keep in mind five lessons learned by organizations that have faced a similar challenge:
> Review the full range of options.…
Affiliations are contractual arrangements between two or more hospital partners in which they agree to work together on projects. No ownership or control is exchanged in affiliations; however, the term is sometimes used euphemistically, or incorrectly, to describe business combinations. These sorts of agreements have existed for many decades as non-profit hospitals have pursued contractual approaches to improve qualitative, operational, or financial performance.…
This joint venture handbook is based upon a series of articles that we began writing for The Governance Institute in the summer of 2014. One year later, many of the “new frontiers” in hospital joint ventures that we outlined have continued to evolve at a rapid rate, and new forms of creative partnerships are announced on a regular basis.…
Eighty-seven percent of hospitals are considering alignment with another hospital or system as a part of their overall strategic planning, according to Dixon Hughes Goodman. This interest is primarily attributed to structural factors in the industry, including the shifting reimbursement environment and issues related to new healthcare regulations that place independent hospitals at a competitive disadvantage.…
Juniper Advisory’s Rex Burgdorfer and Jarrard’s Anne Hancock Toomey were interviewed ahead of their panel for the 8th Annual Becker’s Hospital Review Meeting. The [...]
Methodist Hospitals, a two-hospital nonprofit system in northwest Indiana, has signed a Letter of Intent to join Franciscan Health, a 14-hospital nonprofit system stretching [...]
Rex Burgdorfer served as the moderator for “Private Equity Investments in the Hospital Sector,” a panel at the 14th Annual Healthcare and Life Sciences [...]