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Hospital/Healthcare Mergers

Hello BrainMass OTAs,

I need help with two questions strictly related to healthcare/hospital mergers.

1. Evaluate this assertion: since 1997 there has been a steady decline in hospital mergers. A major reason for this decline has been the lack of anticipated cost savings from the mergers.

2. Also, if a health care merger goes wrong what are the chances of a successful "demerger?"

BrainMass OTA, please provide you ideas in a concise less than 150 words per question. I need this to the point, succinct and brief because OTAs tend to confuse me with verbose, too in-depth analysis in which I can draw from for my own response. Please, use as much plain English as possible.

In your response I would like you to reference the attached chapter from McLean, Robert A. (2003). Financial Management in Health Care Organizations (2nd ed.). Albany, NY: Delmar Publishers.

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Please see response attached, which is also presented below. Supplemented with one supporting article. I hope this helps and take care.

RESPONSE:

1. Evaluate this assertion: since 1997 there has been a steady decline in hospital mergers. A major reason for this decline has been the lack of anticipated cost savings from the mergers.

It is interesting, because in charities, mergers are far more often talked about and investigated than implemented. There have been surprisingly few successful mergers in recent times to turn to as helpful case histories. Many of the most frequently quoted examples are not models of the merging of equal organizations, but feature rescue missions and take-overs as voluntary organizations face the forces of competition and the ravages of social and economic change. If mergers are, to date, more hype than reality, the opposite can be said of the developing range of partnership models. These have blossomed since the late 1980s, at an ever-accelerating pace. Partnership activity may be an end in itself, or the experience may pave the way for more fundamental strategic alliances and the merging of interests and organizations. (1)

In other words, the main benefits of ...

Solution Summary

This solution evaluates this assertion: since 1997 there has been a steady decline in hospital mergers. A major reason for this decline has been the lack of anticipated cost savings from the mergers. Also, if a health care merger goes wrong, it discusses the chances of a successful "demerger." Supplemented with one supporting article on mergers.

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