How CFOs Tackle Financial Integration
Consolidating finance operations, whether the result of a merger or even within an existing system, requires finesse and transparency, CFOs say.
This article first appeared in the May 2015 issue of HealthLeaders magazine.
With most mergers and acquisitions, chief financial officers quickly realize that consolidating finance operations would improve efficiency and lower costs. Achieving that integration is no small task, however, and healthcare executives who have met that challenge more than once say it requires a focus on common platforms and sensitivity to the impact on employees.
The feasibility of merging finance operations was one factor considered in the recent merger of Banner Health in Phoenix with the University of Arizona Health Network. Banner CFO Dennis Dahlen says he intends to consolidate financial operations in such a way that finances for the newly merged system can be managed with about the same resources, or slightly more, than used by Banner prior to the acquisition.
The integration of the two large health systems employing more than 36,000 in Arizona will result in three hospitals and a large physician practice all being renamed to reflect the Banner brand. Banner Health's flagship hospital, Good Samaritan Medical Center, will be renamed Banner University Medical Center Phoenix.
The deal closed in late February, but all staff changes at both organizations are on hold for six months while Banner determines the right sequencing and pace of the consolidation. Dahlen anticipates that the bulk of the workflow changes and other consolidation efforts will be complete in summer 2015. The first steps will involve migrating all of the university network's operations to the same platform that Banner uses, along with implementing Banner's standard policies and procedures. But that won't be simple.