Merging Ahead: Case Studies in Clinic Consolidation
November 9, 2010
La Piana Consulting
This is archived content; for historical reference only.
Although California’s community health centers (CHCs) frequently collaborate with one another, few create deeper forms of partnership such as joint ventures, mergers, or consolidation. This issue brief looks at the experience of CHCs and consortia that have considered or entered into such partnerships, to help inform the field of potential benefits and challenges. Building on earlier research presented in June 2009, it is based on continuing conversations with clinic executives, board members, and other experts in the field. Three consolidation examples are described — one of them an amalgam based on several actual situations.
Some key takeaways from the case examples:
It is best to approach consolidation from a position of strength, rather than waiting until challenges have put one or both partners into crisis mode.
There must be substantial and clearly understood potential benefits for both partners.
Seeking opportunities that allow for building trust incrementally over time is one way clinics can set the stage for future consolidation.
Partners must be ready to disclose complete and accurate financial and operational data during the due-diligence process. A readiness assessment can help clinics position their organizations before they enter a negotiation.
The complete issue brief is available as a Document Download. The June 2009 publication is accessible under Related CHCF Pages below.