COMMENT
parties. What is necessary is an integrated governance, standards setting and data-sharing approach – in that order. IT environments have become enormously complex. The first step to managing the complexity in a coherent manner is the establishment of a unified informatics governing structure of system leaders from technology, clinical and management disciplines. With a governance structure in place, common standards for information elements can be created. It is essential that apples to apples comparisons of all types be available across the consolidated organisation. Finally, with standards set, a health information exchange infrastructure must be established to create a free flow of data across applications and users.
Conclusion
The market pressures driving consolidation seem likely to only grow in the foreseeable future.
view that the above elements will get ‘figured out’, is enough to close the deal and consolidate successfully. History suggests otherwise.
While clarity on the consolidation model is essential, closely related is the speed with which the consolidation occurs. When a deal is done, there is an expectation of change amongst all parties involved. Cultural, management, staff, operating and clinician dynamics all become more fluid. It is while this fluidity exists that integration is most able to occur. If, on the other hand, the deal is done but little changes in the near term, historic dynamics will re-solidify making change and true integration significantly more difficult. We believe that this time of fluidity lasts about nine to 12 months from deal close. While the integration of a given function does not necessarily need to be completed in that time, it should be initiated so as to communicate to the broader organisation that this element is changing.
It is often assumed that management cultural differences can be worked out. This is true at the senior level where the deal gets done, but at the next level the managers will not have gone through the same process as their seniors. The result can be mistrust and fear of losing their jobs or power. It is imperative that the management culture gets as much focus as the medical culture. This should not be confused with the management model – in our experience, the managers in many trusts would be only too pleased to get new tools and approaches to issues like performance management, specialty information and demand and capacity planning, but they do not want to feel that their culture is being completely eradicated.
For health system consolidations that occur in a given geographical market, clinician cultural
22 | national health executive Sep/Oct 14
alignment and buy-in is perhaps the single most important element that drives integration success. While the ‘clinician culture challenge’ mirrors the ‘management culture challenge’, it is different in some very important ways that, depending on the situation, can be very difficult to resolve. Not least of which is that in many circumstances, clinicians involved with the parties are independent economic entities and also may have relationships with competing organisations in the same market. Bringing disparate ‘clinician entities’ together can be complicated, but a desire for a sustainable quality and financial position is usually a place where they can agree.
A strong motivator of consolidation within a geographic healthcare market should be clinical programme synergy
At the same time, consolidation itself poses risks to both the acquired and acquiring organisations.
With so many of these initiatives under consideration, it makes sense for senior leaders to carefully reflect on the history of health system consolidation and the key factors that, at the end of the day, make such arrangements work or fall apart, sometimes in spectacular fashion.
If this next wave is to be the success that everyone needs it to be, then trusts will need to act at speed to align clinicians, managers, culture, information systems and structures against a clear strategy to drive real benefits for patients and staff.
and/or
rationalisation. This potential is often cited in the pre-deal rationale and business case, and it is typical to attribute savings to consolidations. The reality is often different than the business case. Provider organisations are loath to give up any profitable service, and changing referral patterns can be incredibly difficult. Despite the bias toward the status quo and the significant challenge programme consolidation represents, it is our view that programme rationalisation should be a high priority for pre-deal planners and post-close execution. This is one element whose success is highly impacted by execution speed. All efforts should be made to formulate the programme rationalisation plan prior to the deal and drive execution immediately following deal close.
Information technology is the nervous system for a modern healthcare provider organisation. Integrating such systems following consolidation can be a monumental task. Integration does not necessarily mean the adoption of a single electronic medical records system or other core application amongst the
About the authors
Jonathan Pearson is deputy managing partner and Colin Lewry is partner at GE Healthcare Finnamore. Greg Scrine is principal at GE Healthcare Partners.
Jonathan Pearson
Colin Lewry FOR MORE INFORMATION
A full version of this article, with references and sources, can be found at the NHE website. See also: W:
www.gehealthcarefinnamore.com
Greg Scrine
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