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Don't Let Physician Practice Acquisition Derail Your Back Office

Karen Minich-Pourshadi, for HealthLeaders Media, February 21, 2011

For several years now, hospitals and health systems nationwide have been acquiring physician practices. It's a potential growth opportunity for hospitals and health systems, and a stabilizing move for small group practices which may be financially unable to absorb all the possible reimbursement losses due to the changes in Medicare and Medicaid.

In fact, in the coming year 32% of financial leaders say they expect to acquire another organization, and the service lines they'd most like to grow are geriatrics, cancer and oncology, and primary care, according to the HealthLeaders Media Industry Survey 2011. While growth is great, that doesn't mean it doesn't come without causing a few hiccups—especially in your back office.

In the fervor to grow, many have a tendency to look all the benefits (translation, money) that a new acquisition will bring. However, in the haste to reach for success, many also fail to look at the challenges that may result from these purchases—not only in terms of physician alignment with organizational goals, but in this case, in terms of back office processes.

The first step financial leaders should take is a full examination of whether or not the back office has the capacity to handle what's about to come its way. After all, once you've completed the acquisition process, the last thing you need is to discover that you aren't able to handle the new influx of new patient claims that come with your newly acquired physicians and your cash flow suddenly decreases up instead of increases.

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