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Health IT Functions During Practice Mergers: 6 Critical Areas


If your medical practices is preparing for a merger or acquisition, here are six critical health IT areas that deserve your focus.

When practices pursue a merger, significant due diligence is performed on the financials of the arrangement. But a successful merger is about more than just combining organizations and making the monetary figures work. If the clinical side is not prioritized as well, it will be negatively affected.

When this occurs, post-merger integrations will struggle to achieve effective IT functionality. IT must be considered early in the merger (or acquisition) process, or it will likely lead to a very cumbersome, time-consuming and costly effort in the IT merging process.

Practices would be wise to address the following six IT areas in preparation for a merger.

1. EHR and practice management systems. If both practices use an EHR, there are several questions that must be answered as part of effective merger planning. If the systems are different, will one practice transition to the system used by the other practice? If so, how will that transition be handled? How will patient data in one system be merged into the other system?

If you decide to keep different systems in each of the practices, will they interface together? Is it a one- or two-way interface? Where do and don't they overlap? What system interoperability shortcomings will need to be addressed?

If one of the practices isn't using an EHR, will it transition to the same system used by the other practice? If the practice using the EHR isn't pleased with its system, should a change in system occur before the other practice receives an EHR?

Many of the questions posed concerning EHR apply to the practices' practice management systems. What's going to change, what's going to stay the same, and how will changes be made?

With any of these scenarios, one must consider the cost of any changes and the timeline for making a transition and addressing obstacles.

2. Other inbound and outbound HL7 interfaces. HL7 is the standard for information exchange between medical applications. HL7 interfaces are typically used with labs, diagnostic imaging, and health information exchanges.

During a merger, practices need to assess what third parties they interface with through HL7. What third parties are shared and what are different? Do all of the interfaces need to be maintained, or will practices change some interfaces? How would a change affect work flow?

It's important to look into all of those details and analyze the impact a merger will have on these relationships.

3. Licensing. When a practice invests in any software package, it agrees to a license that dictates the legal terms and conditions for use of the software. For example, if your practice has an EHR system, that system likely came with a license specifically explaining how the EHR can be used by the practice.

During a merger, many changes may occur, including the number of physicians at the practices or a change in the name of the practices. Software licenses may directly or indirectly speak to these (and many other) scenarios, identifying what is and is not permissible use under the license term and conditions. The license may state a maximum number of physicians who can use the system or may authorize a practice by a specific name. For any mission-critical systems, make sure to understand how the licensing applies to you and the implications of a merger on the license terms and conditions.

4. Contracts. Contracts, like licensing, spell out the rules of a relationship. Practices usually have contracts with a number of IT service providers, from telecommunications to backup systems to comprehensive IT management companies. During a merger, at least one of the practices usually experiences changes with some of its service providers.

If you want to expand a contract as a result of a merger, the party you're contracting with will likely embrace this opportunity. But if you want to opt-out of a contract, this may not be as easy. Make sure you understand the length of your contracts and the terms you agreed to for opting out, and put together a comprehensive plan for how you will properly and effectively transition existing contracts.

5. IT staff leadership. Most practices have a designated point person who oversees IT. This person could be a staff member or a representative from a third-party IT management company. The responsibilities of this IT point person often include leading discussions and making decisions about new technology, training staff, troubleshooting systems and conducting audits to ensure IT security and functionality is maintained.

When a merger occurs, practices must make several decisions concerning this role. Who will oversee IT changes at each of the practices during and after the merger? Will there be a single person overseeing the two practices or will each practice have their own point person? If both practices have an IT point position, what is the process for making decisions about IT changes that will affect both practices?

To address some of these challenges, practices undergoing a merger will often bring in an IT management company to ensure any IT changes and transitions are completed properly.

6. HIPAA security and compliance. There are many moving parts during a merger, and the changes to IT that occur during this process increases the chance of security breakdowns and HIPAA violations. It is critical for practices to perform a complete risk assessment prior to, during, and after a merger in an effort to prevent possible breaches, minimize security holes, and identify and then address concerns.

If practices undergoing a merger, hire an IT management company to assist with the transition, this company will likely provide HIPAA risk assessment services that help to verify communications between the merged practices are compliant.

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