AHA offers guidance to hospitals on verge of M&As

The American Hospital Association (AHA) on Wednesday released voluntary guidelines about hospital ownership changes. With changing integration models, the AHA report is likely a welcome relief for hospital and health system leaders considering mergers and acquisitions, integrated delivery networks or accountable care organization formation.

Healthcare leaders, including executives, directors, officers and physicians, increasingly are looking for direction in approaching new partnerships. For example, will a new partnership fulfill the hospital's core mission, fall in line with strategic planning, ensure quality of care or include potential liabilities?

"Hospital leaders must approach potential integration opportunities in a manner that protects the delivery of health care services in their communities but that recognizes the hospital's need to adapt in a changing environment," according to the report. "Moreover, hospital leaders must consider how to engage their communities as well as state and federal regulatory agencies regarding potential changes in ownership or control."

Prepared with the Jones Day law firm, the AHA guidelines recommend conducting a review of state and federal laws and antitrust analysis, as well as communicating with the community about possible changes.

When considering hospital mergers, research from the U.K. this month suggested that healthcare mergers might not be the best solution to financial or quality problems. Hospital consolidation in England in the late 1990s and early 2000s offered few benefits, with larger deficits after mergers and little indication of improved clinical quality, according to the study.

In the United States, 78 percent of surveyed organizations are exploring or have M&A deals under way, according to a recent HealthLeaders Media report.

In fact, 980 healthcare-related mergers and acquisitions across all sectors took place in 2011, equaling $227.4 billion, up 9 percent from $207.7 billion in 2010, according to data from healthcare research firm Irving Levin Associates.

To learn more:
- check out the guidelines (.pdf)
- read the AHA news brief

Related Articles:
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