Preparing for an Acquisition? Consider These Steps for an Effective and Efficient Transition
An organization’s decision to complete an agency acquisition is an exciting one. According to Rachel Hawkins, RN, BSN, Senior Manager at Simione Healthcare Consultants, once a decision to proceed with the purchase is made, the transition planning should begin immediately. “Timing is everything for an efficient and successful transition process,” she explains, “and those in leadership and decision-making positions must look at all aspects of the home health business from legal and regulatory requirements to day-to-day operations, including the unique nuances of the selling entity in order to prioritize and implement a complete and effective transition plan.”
A nurse leader with 20 years of home care experience who specializes in clinical mergers and acquisitions, Hawkins has outlined six key areas for successful transitions following the acquisition of a home health business:
First and foremost, Hawkins emphasizes the vital role of frequent internal and external communication throughout the transition to ensure accurate and complete information is presented to employees, referral sources, and patients. Home health is a local market business and effective communication to all stakeholders will facilitate greater cooperation and engagement for success. Hawkins says that organized and frequent communication will enable employees to be ambassadors to communicate the benefits that can be expected from the transition process.
A second area of emphasis for post-acquisition is the legal and regulatory arena. Hawkins advises that the agency make the necessary decisions regarding organizational structure of the new entity and complete the required document filings in order to operate after the acquisition is complete. Federal and state regulatory entities require official notification to ensure your “new organization” can operate and bill in full compliance with any requirements.
During her experiences leading teams in operations, compliance, clinical care, training and program development for multiple home care branches, Hawkins has identified the third area of focus, but yet one of the utmost importance for post-acquisition success, as patient care. “Dynamics change significantly when two organizations become one,” says Hawkins, but with the new organization, agencies need to remember that the sum is greater than the individual parts. Daily clinical operations and patient care must continue with minimal interruption through the transition and post transition. Many aspects must be considered to ensure that the strategic business goals of the transaction are met and operational efficiencies are obtained, while ensuring patient care remains seamless and uninterrupted. The process of sustaining strong clinical operations in time of transition is challenging, but very fulfilling work if you engage your teams effectively and encourage their best work.”
The fourth ingredient for a successful transition is a high level of employee buy-in. The employees are an extremely important asset in the total value of the purchase, and can have a direct impact on the success of the transition; therefore, employee commitment to the new organization is of key significance. The Human Resource practices and follow-through directly correlate to the satisfaction of employees, and must receive careful evaluation and consideration for the ongoing benefits and pay practices of the new entity. Employees need validation of the acquisition plan so that they have clear expectations and understand their roles to support the new organization. Key components of these efforts will be employee education and the implementation strategy of the core operational and clinical policies and processes to create a standardized and effective workforce. Hawkins suggests that agencies consider the implications and timing of executing these initiatives to avoid interruptions to daily operations and patient care.
The IT platform and network considerations constitute the fifth area that must be taken into account, so that email and telecommunications meet the ongoing business needs following the acquisition. If systems are not retooled and standards are not set, the network will not serve to create a positive impact on the agency during the transition.
Finally, the sixth area of focus for efficient implementation is general finance and accounting activities. The new entity must establish unified processes and protocols for financial functions, including accounts payable, accounts receivable, payroll and general ledger to meet the new and ongoing needs of the business.
The team at Simione Healthcare Consultants specializes in helping home care and hospice organizations improve and grow through acquisitions, including clinical and financial due diligence, and assistance to plan and implement an effective transition process that engages employees, patients, referral sources and payors for successful outcomes.
For more information, call 844.215.8823 or email [email protected]