Bucyrus Community Hospital Merger Case Study
A competitive strategy that Vandenberg should continue is merging and acquisition with other organizations. Competitive strategies can help organizations because it examines the market and organizations within the market to get a competitive advantage. With so many threats in health care Mr. Vandenberg himself stated that “there is a great opportunity for mergers and acquisitions for the future to set up more growth.”
With the new health care reform and the uncertainty of the US health care system, there is a growing trend of healthcare organizations to merge and acquire other organizations. Healthcare organizations like multi-hospital health systems, stand-alone hospitals, large medical groups, small independent physician group practices, …show more content…
One benefit is it can increase efficiency because you can cut duplicated care services and you can cut the overflow of patients because now you have a parting organization who can take some of your patients. Another benefit of merging and acquisition is it can benefit a whole community. An example of this can be seen with the acquisition of Bucyrus Community Hospital by Avita Health System in Galion, Ohio.These two hospitals were located only 12 miles apart. Avita was able to save $1 million per year in administrative costs with this acquisition. Both hospitals also shared an electronic medical record system and was able to recruit more specialists to enhance volume in their organizations. Avita hired more nurses and added 300 full-time employees. Also, patients around Bucyrus Community Hospital now don’t have to travel to get services because Avita was able to prevent the hospital from closing down. Another positive was that there were no layoffs and if Bucyrus hospital would have closed it would have resulted in 250 layoffs approximately. This acquisition was a success and a benefit to the community because (1) it increased jobs, (2) it prevented layoffs, and (3) it prevented patients from traveling farther to receive care.
With the new health care reform and the uncertainty of the US health care system, there is a growing trend of healthcare organizations to merge and acquire other organizations. Healthcare organizations like multi-hospital health systems, stand-alone hospitals, large medical groups, small independent physician group practices, …show more content…
One benefit is it can increase efficiency because you can cut duplicated care services and you can cut the overflow of patients because now you have a parting organization who can take some of your patients. Another benefit of merging and acquisition is it can benefit a whole community. An example of this can be seen with the acquisition of Bucyrus Community Hospital by Avita Health System in Galion, Ohio.These two hospitals were located only 12 miles apart. Avita was able to save $1 million per year in administrative costs with this acquisition. Both hospitals also shared an electronic medical record system and was able to recruit more specialists to enhance volume in their organizations. Avita hired more nurses and added 300 full-time employees. Also, patients around Bucyrus Community Hospital now don’t have to travel to get services because Avita was able to prevent the hospital from closing down. Another positive was that there were no layoffs and if Bucyrus hospital would have closed it would have resulted in 250 layoffs approximately. This acquisition was a success and a benefit to the community because (1) it increased jobs, (2) it prevented layoffs, and (3) it prevented patients from traveling farther to receive care.