The way healthcare is delivered and paid for continues to evolve rapidly. This creates opportunities for consolidation among physician practices, hospitals, health systems, private equity firms, and ancillary healthcare entities. 

A thorough valuation and transaction advisory process is essential for successful transactions. Here are many services an M&A healthcare consulting firm can provide: 

Mergers & Acquisitions 

As healthcare evolves, so do opportunities for strategic initiatives that may include a merger or acquisition. Whether it be a hospital or health system, physician medical group, or ancillary healthcare entity, these deals involve complex financial, revenue cycle, tax, and post-merger operational and systems integration issues. 

Mergers and acquisitions can save costs by reducing duplicate staffing, office space requirements, purchasing power on supplies, and more. Achieving these savings allows a healthcare business to expand its services and client base, grow revenue, and improve brand awareness. 

A thorough financial due diligence process is required to ensure the success of a transaction. This includes examining insurance contracts, reimbursement rates, billing practices, and coding standards. Our team provides a comprehensive analysis to help you make the best decision for your organization. We also assist with structuring aspects of a deal to maximize value and mitigate risk. 

Valuation 

Modern health care is delivered using a variety of business models. The resulting complexities create growth opportunities, often involving a merger or acquisition. A comprehensive valuation and transaction advisory process is critical to a successful outcome. 

Healthcare organizations face unique challenges, including highly regulated financial management and reporting requirements. Cherry Bekaert’s Healthcare Group understands these issues and can help you navigate them. 

Mergers and acquisitions within the healthcare industry can often reveal confidential information sensitive to both parties. An experienced Healthcare Transaction Advisory team must provide a thorough valuation and due diligence process to minimize the risk of compromising this information. In addition, healthcare entities must be mindful of antitrust and corporate laws that are in place to prevent unsavory monopolies and promote fair competition. We can provide a full suite of transaction advisory services to help you comply with these laws and mitigate any risk in the future. 

Due Diligence 

As healthcare evolves, organizations seek strategic opportunities to position themselves for the future. This often involves a merger or acquisition. A thorough valuation and transaction advisory process is critical to the success of these projects. 

This process is known as due diligence, examining the economic, legal, fiscal, and financial circumstances surrounding a company or individual before entering into a business arrangement. Investors use it to assess risk and can also involve background checks on prospective employees or contractors. 

Due diligence can be complex, especially for healthcare businesses. The need for comprehensive information in a tightly regulated industry makes it more challenging to evaluate compliance and risks. For example, in physician medical group transactions, it’s essential to carefully review compensation arrangements to maintain the balance between physician incentivization and patient care stability. Performing administrative due diligence, or admin DD, can help verify items such as facilities, occupancy rate, and workstations to determine whether operational costs are accurately reflected in the financials. 

Strategic Planning 

Strategic planning is setting overall goals for your business and creating a plan to achieve those goals. It involves stepping back from day-to-day operations to consider the big picture and identify your organization’s strengths, weaknesses, opportunities, and threats. Strategic plans can be short-term or long-term and typically address goals up to five years out. 

An effective strategic planning process requires both intuitive and analytical thinking. Intuitive thinking helps to identify strategic challenges that might not be obvious, and a well-researched, detailed analytical component can help to develop meaningful objectives and goals. Setting a timeline for reviewing and updating the strategic plan is also essential. A recurring alert, quarterly meeting, or annual review can keep your strategic plan focused.