Mergers & Acquisitions

Mergers & Acquisitions

Veralon has been assisting healthcare providers with mergers and acquisitions for more than 20 years, with greater frequency in the last several years as the rate of consolidation has increased. We understand firsthand the challenges and difficult decisions relating to mergers and acquisitions that providers across the country are facing as this wave of consolidation plays out.

Veralon helps ensure that when healthcare mergers and acquisitions are pursued, they will be the right choice for your organization, and that any such arrangement will result in lasting and positive relationships. Our work is results-oriented, helping your organization reach a go/no-go decision.

We work with hospitals or health systems that are seeking to merge with an existing system, and with systems that are seeking to add or acquire a specific hospital or small health system. Our services for mergers, acquisitions, and collaborative arrangements include:

Facilitating the Process
Once your organization has made the decision to consider a merger or acquisition, the dating game begins. Veralon can help health care organizations define the approach that best meets their needs, whether that involves approaching one or more potential candidates informally, or issuing a request for proposals from interested parties. We work with you to create a criteria-based evaluation process to determine what partners, merger models, and/or levels of integration may be worth pursuing. Veralon facilitates discussions among potential partners for mergers or acquisitions.

Evaluating Potential Partners for Merger or Acquisition
As the list of potential partners is narrowed, Veralon can conduct an objective assessment of specific candidates in relation to the criteria established in the phase above. This may include evaluation of cultural compatibility, potential physician impacts, clinical program and quality impacts, and quantification of financial benefits.

Financial Modeling
We model the financial impact of any healthcare merger or acquisition vs. the “go it alone” scenario, as well as comparing the financial impact of different merger partners and scenarios against each other. Our robust modeling includes the preparation of prospective financial statements under various scenarios. We can also assess capital capacity with and without the merger. (See also the Financial component of our Due Diligence work.)

Implementing Merger or Acquisition: Consolidation and Organization Plan
Veralon’s support during the implementation process can take many forms, including strategic, operational, facilities, and organizational components. We can help with:

  • Developing an implementation plan for merger or acquisition
  • Creating the formal agreement and performing related due diligence work including multi-campus facilities assessments
  • Developing a highly functional organizational structure that will facilitate achievement of strategic goals
  • Establishing service line and other program development plans
  • Working with counsel on attorney general filings
  • Developing certificate-of-need applications

Post-Affiliation Integration and Restructuring
Hospitals and health systems need to achieve more than consolidation—they need true system integration across a broad spectrum of financial and clinical dimensions, to maximize value for customers. “Systemness” is a term used to describe the shift from a hospital and ambulatory-centric enterprise to the full, balanced continuum of care, including integrating extended care and community health resources with other system services. Veralon’s team of multidisciplinary experts can help executives to set priorities and create plans to move their organizations forward towards this goal.

We can help identify and realize integration and restructuring benefits, yielding financial gains while improving clinical operations. We can also bring objective perspectives to discussions and decision-making processes that may have stalled or been derailed.

Through our strategic partner, Veralon can also provide merger and acquisition clients with national expertise in multi-campus service configuration and subsequent facilities master planning.