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Building an integrated hospital or health system after a merger can be complicated. After all, hospitals and health systems arguably are among the most complex, sophisticated organizations.

Yet, the general steps taken to successfully integrate hospitals and health systems are strikingly similar to the steps and concepts required to build a shelving unit, for example.

A new AHA Market Scan Trailblazers report, “Assembly Required: An Operator’s Manual for Post-Merger Integration,” outlines a 10-step approach to this process. The report includes case studies on how Henry Ford Health and USA Health each handled post-merger integration in their respective systems as well as insights from Guidehouse, a health care consulting firm that sponsored the report.

4 Keys to a Successful Post-merger Integration

1 | Begin with the end in mind.

Anyone who’s ever tried to put together a shelving unit, a piece of office furniture or rolling kitchen island from IKEA knows that the cover or first page of the assembly instructions is always a picture of what the item is supposed to look like once it’s completed.

It’s no different for hospitals or health systems that have just signed a merger or acquisition agreement. Both sides must be aligned on the mission, vision and values of the consolidated organization as well as how it will function and operate after the integration. The shared vision of a successful integration will serve as the North Star to keep the newly consolidated organizations on track as they change everything from how they buy supplies to how they deliver care.

Takeaway

“Everyone sees the potential of an integration, but it’s tough to achieve,” says Mark Korth, a partner with Guidehouse. “The end state should expand patient access to improved care, with caregivers and employees feeling a common culture and being part of one organization.”

2 | Inventory everything that the combined organization will need to integrate.

A successful integration goes well beyond dollars and square footage. It includes all people and processes — clinical, financial and operational — across both legacy organizations. The combined organization must have a complete inventory to be fully integrated into one entity laser-focused on a shared vision of successful integration.

Takeaway

Guidehouse sources note that a sample list of people, processes and technology to integrate could include:

• Ancillary clinics.
• Clinical program design.
• Core clinical information technology systems (e.g., electronic health records).
• Core nonclinical IT systems (e.g., enterprise resource planning).
• Independent physicians.
• Physician alignment.
• Human resources.
• Management structure.
• Payer contracting.
• Supply chain.
• Revenue cycle.

3 | Set a realistic yet aggressive timetable for integration.

The assembly instructions must include a detailed timeline of how long the integration will take, the important milestones along the way and when the combined organization should complete each milestone. Hospital or health system integrations should take one to two years to complete, according to subject matter experts interviewed for this report. The length of time will vary depending on the breadth of the integration.

Takeaway

A clear timetable will accomplish several goals. First, it will keep integration momentum going because no one wants to be the leader of the team that falls behind. Second, it will create opportunities to celebrate completions of major milestones. Third, it tells everyone that there is a light at the end of the tunnel and that they’re not on an endless journey. Also, having a shorter time frame makes integration more achievable because it drives everyone’s focus.

4 | Develop a comprehensive integration road map.

As in any set of assembly instructions, the secret is doing things in the right order. Partners must take the list of everything the combined organization must integrate and schedule it thoughtfully along the timeline.

Some processes and technologies must go first to keep the organizations running, including human resources, finance, revenue cycle and supply chain. Others can integrate concurrently, such as payer contracting, management structure and communications. Some must go last because of their inherent subtleties and complexities, e.g., clinical program design and physician alignment.

Takeaway

“You must have a very clear structure for communications,” says Amy Chieppa, associate director at Guidehouse. “How do I know what’s happening? How do I know who makes the decision? And how do I escalate [issues] when things aren’t going the way I think they should? Your plan must have answers to those questions.”