In healthcare, the big are getting bigger. In 2018, the hospital industry set a new record for mergers and acquisitions – 1,182 in total, a 14.4% increase from 2017. That trend continued in 2019, with the combined value of deals increasing, giving rise to the “mega-deal.”
Hospitals are in the Age of the Merger. That may come as no surprise, but recognizing the trend and being ready for it are entirely different. While studies show positive outcomes from mergers, the actual experience of going through the process involved can be a challenge for organizations that don’t properly prepare for it. One area, in particular, that can cause concern is around the provider data management.
Prioritizing RCM processes
Revenue cycle management (RCM) is one area deeply impacted by mergers and acquisitions. Hospitals and health systems spend significant time and money to ensure a merger or acquisition does not have a negative effect on care. But, there is no getting around the fact that a merger has an enormous, inescapable impact on RCM and data management for all parties involved.
“Consolidating revenue cycle departments is both an art and a science,” Huron Healthcare’s Robert Parris told Becker’s in 2016. Organizational pressures to develop a streamlined, cost-efficient solution increases the need for sound planning and management of many pieces of the RCM operation; one segment that should not be overlooked is provider data management.
Mobility is rising and more physicians and clinicians are finding employment with hospitals and medical groups instead of private practices. When a clinician moves from a private practice to a managed organization, it sets off a cascade of data management tasks that must be performed smoothly and quickly to ensure everyone gets paid accurately and in a timely manner. When an entire organization merges with another, that workload is multiplied for every provider whose information will change.
Combining the provider data management processes of two merging organizations can look like trying to fit a lot of square pegs into round holes. While every healthcare system, hospital, and organization may have its own unique methods of managing provider data, the reality is that often the major pieces share similarities. Once the commonalities are found, streamlining these processes should be one of the first steps toward a successful transition.
Maintaining Data in the Shuffle
Too often, important provider data management tasks like enrollment with payers and credentialing become massive causes of administrative waste and delay, leading to sluggish administrative processes and unhappy doctors.
A merger leads to many iterations of those tasks, especially as processes like credentialing that have to be repeated every few years. It’s all the more important to get started early so that by the time the proverbial dust settles on the fusion of the organizations, providers can function without administrative friction getting in the way.
The propensity for error only underscores this fact, as iterations of provider data management functions prompt opportunities for the kinds of faults that delay payer-provider transactions.
Mergers are massive events for every organization involved. Though they bring the promise of unity and efficiency, they can also create chaos and confusion. They force organizations to take a hard look at operating procedures and determine what works and what doesn’t. Most of all, mergers bring change, and when it comes to provider data, change can mean a challenge.
As M&A activity continues to rise, a proactive approach to provider data management and other RCM functions with a focus on automation is crucial in the successful combination of organizations.