I've been thinking about these ideas for a while now with the idea that there are no universal solutions. You know this intuitively, but sometimes the rush to make a move in the face of change overwhelms intuition and logic.
Each facility is different, and each one will reach sustainability its own way. Just don't go into any strategic planning session with your mind closed. If you don't think your facility has the size, the scale, or the capital to stay competitive in today's rapidly changing reimbursement environment, you might be right.
But there's just as good a chance you're not fully exploring all your options. Funny, but that's a nuanced opinion that it seems not a lot of folks share these days.
When I ran into Joe Lupica, chairman of Denver-based Newpoint Healthcare Advisors, it seemed I had found a kindred spirit. That was strange, given Lupica's background as an investment banker and M&A specialist at Kidder-Peabody and then Goldman Sachs. But you won't hear him singing the siren song of the merger—at least not before considering the many other options out there.
Beware of Experts Touting More Scale
At its heart, this scramble for assets has its roots in the steepening risk profile hospitals and health systems are being asked to take on. As we were talking, Lupica pulled out a couple of old official statements from bond issues he's worked on for hospitals or health systems in the past. The fun part begins when you start reading bondholder risks attached to the issue.