The Current State Of The Health Care Environment

In 1997 University of California, San Francisco (UCSF) merged its two public hospitals with Stanford’s two private hospitals. The two separate entities merged together to create a not-for-profit organization titled UCSF Stanford Health Care. The merger between the health systems at UCSF and Stanford seemed like a good idea due to the similar missions, proximity of institutions, increased financial pressure with cutbacks in Medicare reimbursements followed by a dramatic increase in managed care organizations. The first year UCSF Stanford Health Care produced a profit of $22 million, however three years later the health system had lost a total of $176 million (“UCSF-Stanford Merger,” n.d.). The first part of this paper will address reasons

Merging with another organization has downfalls of destroying wealth from the merger. Considering the buying price is important when merging, spending too much on the merger will impound the value after the merger. Some mergers do not create wealth so capital is lost through the merger. There is no guarantee of financial gain and every formula considered with focus, just as with an acquisition. The final decision dictated by the variables. One company merging with another company takes the debt and losses of those companies in the new formed company.

There are also many opportunities McBride Financial can take advantage of by merging with another organization. By merging with another organization, McBride Financial has the opportunity increase the firm’s productivity and wealth through economies of scale and tax benefits. In addition, McBride Financial has the

(a) In a merger agreement, the assets and liabilities of the firm which is being acquired end up being absorbed by the buyers firm. A merger could be the most effective and efficient way to enter a new market without the need of creating

Mergers have become normal practice in the health care industry by creating a larger hospital system that provides broader services with the focus on lowering healthcare cost and being economically profitable with keeping in line with regulatory guidance. A merger happens when two or more organizations agree to join together and become one organization. One or more organizations essentially must dissolve for this to happen. Sometimes both organizations dissolve and take on a completely new name as in this case of the merging of the two competing hospitals. (McClure, n.d.) Hospitals along with health systems are following the same trend to merge with other hospitals, this movement has continue to gain momentum and appears to be the future trend in the health care industry due to high operating hospital cost. In a survey done in 2012 regarding hospital maintaining independence only 13% plan not to align with other hospitals or health care systems, while the other 87% plan some type of merger with another hospital or health care system. (Hospital Mergers and Acquisitions, 2013)

One of the greatest changes in healthcare in the past ten years has been the rise of managed care, much to the displeasure of many patients and physicians alike. Managed care arose out of concern about spiraling healthcare costs and was designed to encourage physicians to give patients treatments that were cost-effective out of their own financial interests. "The consumer strategy was directed at imposing some barriers to use by levying various forms of co-insurance. The most common approaches used either deductibles (where the consumer paid the first portion of the bill a technique familiar in other types of insurance) or co-payments (where the consumer paid a portion of the bill and the insurance company the rest) or a combination of both' (Kane et al 1994). Managed care has given health insurance companies an increasingly significant voice in how treatment is administered and allocated. Managed care has proliferated in the past decade despite considerable criticism of the practice of 'nickel and diming' patients as well as the considerable bureaucratic red tape it is has generated. Also, research indicates that healthy, well-insured patients tend to over-consume care without meaningful co-pays but poorer, sicker patients can be deterred even by moderate co-payments and suffer negative health consequences (Kane et al 1994). However, managed care has not gone away and is a reality that all healthcare

A merger is a partial or total combination of two separate business firms and forming of a new one. There are predominantly two kinds of mergers: partial and complete. Partial merger usually involves the combination of joint ventures and inter-corporate stock purchases. Complete mergers are results in blending of identities and the creation of a single succeeding firm. (Hicks, 2012, p 491). Mergers in the healthcare sector, particularly horizontal hospital mergers wherein two or more hospitals merge into a single corporation, are increasing both in frequency and importance. (Gaughan, 2002). This paper is an attempt to study the impact of the merger of two competing healthcare organization and will also attempt to propose appropriate

In addition, like any other merger between two firms, companies benefit from significant cost synergy during the implementation of an acquisition and/or merger with other company. For example, when two companies combine their strengths to complement each other, they restructure their operations and as a result several offices and sites are closed down which leads to the laying off of employees, consolidating services and software applications. All these changes, result in synergy savings for the new company.

Hospital Alliances or merger is rapidly growing in the health care industry. Hospitals could use merger or acquisition for acquiring a larger market share in any prevailing financial circumstance. Strategic alliances are arrangement between two or more organizations for the purpose of ongoing cooperation and mutual gain/risk sharing (Burns, Bradley & Weiner (2012). Joint ventures, mergers and other arrangements between providers are most often intended to re-align the interests of the individual providers with the consumer and public policy goals for a less costly, more efficient, high quality, accessible - and above all else, coordinated - health care system. Organizations form alliances with the expected return or benefit of improved financial

The current state of our health care delivery is a dysfunctional mess at best. The cost of financing an Affordable Care Act insurance plan within the confines of what is written into the language has not yet been determine . For people earning over $35,000.00 per year there are no subsidies, for folks with Cadillac plans provided by employers there are taxes levied for non-cost containment. That seems to be a punishment and makes no sense as far as cost analysis. According to the report issued by Stinson, “Employer-sponsored plans valued at more than $8,500.00 for individual coverage and $23,000.00 for family coverage would be assessed a tax equal to 40 percent of the excess value amount. Designed to be incentive to insurers to keep their

When companies combine/merge the whole objective is to gain new opportunities, gain market share, grow the business, to become more innovative and to improve product offerings, utilizing/sharing the existing resources and data. From the case

The health care industry exist to provide preventative measures, diagnose health conditions, repair, and provide services to improve the quality of life. The cost of health care continues to rise each year. Health care fraud is a factor that continues to plague the health care industry. The affect health care fraud has on hospitals, is the increasing cost of medical services. The following research will examine and evaluate how organizational structure and governance, culture and the lack of focus on social responsibility affects on health care fraud. The following research will also include recommendations for prevention of health care fraud, recommendations for

Determine the key factors that will drive the financial planning process for most organizations in the post-merger phase, and examine the related impact to the organization process. Provide support for your rationale.

This case study is about two merging hospitals Porter Regional Medical Center (PRMC) and Banner Regional Medical Center (BRMC) that are merging together but were once competitors. PRMC is located on the east side of town which consisted on 110 hospital beds with 188,000 square feet of facility space and 63 acres of land. BRMC is located on the west side of town with 154 patient beds, with 561,366 square feet of space and 6 acres of land; however, BRMC faces the dilemma of aging facilities and is granted the funds to renovate the facility with the completion of the project ending in the next three years. PRMC last year, faced a one million dollar lost and caused the organization to liquidate. Both organization CEO’s were interviewed to

One major objective of mergers is to be able to reduce or fully eliminate the weaknesses that may exit in