Great business and operational skills are no longer enough for C-suite leaders. Good people skills are increasingly in demand.
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It’s here.
Today, the United States Supreme Court struck down Roe v. Wade.
The ruling is “one of the most consequential in modern memory.”
Across the country, healthcare providers are deeply involved in the private and very public conversations happening in light of the seismic decision.
The questions we’ve been asking since the leak have been answered. This is a moment of divisive and profound emotion. Celebration and relief on one side. Fear and anger on the other. Exhaustion by all as our country is further unsettled.
Hopefully, you’ve done the homework recommended several weeks ago. Either way, here’s immediate guidance.
Speak. To whom and how depends on your community, your culture and position. But the people important to you – your colleagues, nurses, allied physicians and, likely, your community – want to know how today’s decision affects them; how, as an organization, you’re thinking about it and acting on it; and what the longer-term consequences might be.
There are (too) many hot button cultural issues today, some of which healthcare leaders may have strong opinions on but little standing. Weighing in on the war in Ukraine is a local decision.
The redefining of women’s health services, however, is squarely in your lane. It is where your voice is uniquely trusted, needed, expected. Again, whether to have a message on this issue is not optional. Not addressing it – the choice of silence – is a powerful message, too. Choose words.
Here’s where to start:
- Align your team. This issue is divisive enough; your organization should speak now with one voice. Gather your leadership group as colleagues, listening to each other in a spirit of friendship, good faith and a shared commitment to the mission of care. Find that common message.
- Know your record on abortion services. You have an obligation to follow all laws and regulations. You also have a mission to care for those in need. How have you been operating and, now, how will you operate in the context of your state’s environment?
- Equip leaders. Send your managers into team huddles with the tools they need to listen effectively, guide conversations as appropriate, and allow people to express how the news is affecting them while keeping things civil and centered on the common mission.
- Check in with employees. Provide channels for team members at all levels to learn about the organization’s stance and how it affects operations, while leaving space to provide input.
- Support your clinicians. There’s deep concern about the legal risk faced by physicians who provide women’s health services in states with existing or soon-to-be-passed restrictive laws. Get your legal, clinical, financial and marcom teams together to discuss how you’re handling this and how quickly you can move. Then, meet with the clinicians who may be affected to discuss your plans and listen to their concerns.
- Check back with your GR team. Your state officials have been planning for this decision, and it’s a fair bet that your legislature’s and legislators’ plans have been all over the news. Even so, there may be nuance now that the decision is official. You’ll want to know.
- Anticipate “what now” questions. Be ready to speak directly to the questions that are asked, but don’t feel like you must have an answer to every question. This is new. Similarly, don’t get bogged down in discussion on scenarios that didn’t come to pass.
This is a hard moment. We know it demands the very best of each of us as we move through this fractious time, and as you take on this challenge for your organization. Mission, culture, zip code and politics all play a role in how you respond. Why so hard? Because it raises the questions, “Who are we as an organization?” and, “Who do we choose to be?”
We also know this is the latest in a relentless accumulation of hard moments. As you rise to the occasion – again – take care of yourself and your team. And know that we’re in it with you.
Photo by Claire Anderson on Unsplash
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Healthcare and society are now two years into a period of renewed focus on improving diversity, equity and inclusion for both those employed within healthcare and those served by it. The hope, after devastating inequity and bias were brought to light through the pandemic and George Floyd’s murder, is that this “period” will in fact be permanent. It’s well past time to finally solve the lack of diversity within the upper echelons of healthcare and the gaping chasms in access and health equity between white and Black (as well as brown) populations.
So, then, what progress been made in the past two years? Is momentum being maintained towards bringing more Black voices and experience into healthcare, not just in word but also in deed through investment of FTEs and financial resources?
With the second federally-recognized Juneteenth holiday just passed on Sunday, the Jarrard Inc. DEI team, which operates under the Kaleidoscope name, wanted to get a sense of what’s happening across healthcare.
To do that, we sent questions out to some of our expert friends from across the industry whose work centers on DEI in healthcare – and beyond.
Every contributor reminded us that representation matters – it’s table stakes. And several pointed out the importance of organizations and leaders meeting people where they are by developing initiatives that fit with how those affected already live. That, rather than trying to pull people in and putting the burden on them.
Here are six themes from our conversations. Full quotes from the interviewees can be found below.
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Things have gotten very loud and covered in emojis. Maybe we should reconsider - in both our professional and personal lives.
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Ford CEO Jim Farley is creating a real-time case study for legacy brands - like century-old hospitals - on how to disrupt themselves.
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This week, former head of social and digital at Mayo Clinic Lee Aase and Jarrard’s David Shifrin talk about recent mass shootings, including those in medical facilities in Dayton and at St. Francis in Tulsa. We’re horrified by what’s happening, and there’s so much to deal with here, but because this podcast is focused on helping healthcare marketing teams in their roles as the voice of the organization, we talk about some things that digital marketing and communications pros can do to help guide messages around the issue of gun violence. And, maybe reduce some of the criticism that often follows any kind of difficult situation.
Listen and subscribe to the podcast, or read the transcript below.
Read the Transcript
David Shifrin: So Lee, good to see you again. Last couple of weeks have been a challenging time in society and healthcare. So many national headlines across the past couple of weeks and the numerous headlines around gun violence. We were looking at this issue with the mass shootings and Buffalo and in Texas.
And then just as we’re sort of trying to process that, then we see gun violence come to healthcare facilities in Dayton and Tulsa. We see healthcare providers in the middle of this issue and in this conversation for multiple reasons, and so in all of that, marketing and communications and digital teams are having to craft messages around challenging issues. And in this case today, specifically around gun violence, and do that in a way that is meaningful and addresses the issue in a meaningful way.
So I wanted to spend some time with you thinking about how we can support marcomm digital folks at healthcare providers, and just give them some things to focus on very practically as they are dealing with all of this input and trying to craft messages that are productive for the community.
Lee Aase: I would just say, first of all, it’s just a gut-wrenching time when you’re faced with all this stuff, and when we’re seeing just the devastation that comes from this stuff, and people immediately want to say “We got to do something. Okay, we gotta have a response,” and that’s totally understandable.
It’s commendable, that people would say “we want to do something about this,” but it’s like, what’s the thing that you do? And these are the kinds of issues on which reasonable people disagree. They have different solutions, and nobody wants to see schools get shot up or healthcare facilities get shot up.
And so how do you deal with the environment that we have? How do you deal with the constitutional issues that we have? As well as then some of the things like the mental health crisis, which is obviously behind a bunch of this, when you see especially in some of these mass shooting events.
And we were talking a little earlier about how for children that gun violence is, like, just inching up as the number one cause of death now. And that’s not just mass shootings, but it’s the day-to-day kind of mayhem that’s happening. And so it is, it does put us in a tough position to try to…because the desire that people will have is to have some kind of response. And then they say our thoughts and prayers are with them, and people are like, thoughts and prayers don’t do anything! And then you get into, yeah, we’ve all lived that. We’ve all lived that.
DS: It devolves so quickly.
LA: Yeah. And so I think from my perspective, the thing is as marketing communications, people working on behalf of organizations, our job is to help the leaders accomplish what they’re trying to accomplish, and what is the goal that they have by doing this thing? And thinking through what the implications are and how they might say this and, you know, put together messages that aren’t accusing everybody else who’s on the other side of, who has a different opinion or bad faith, and to try to create an environment of respect. And I realize I’m saying this in the context of online discussions, how’s that going to happen?
But starting within the organization, probably, that’s where there is more decorum perhaps, starting the conversations internally, close to home and talking about as organizations, what concrete positive steps we might take.
And some of it might be around mental health and that they’re really addressing some of that, but it’s a vexing time and it’s really a time when, for people who are in that, in the public eye and kind of feeling like there’s a need to take a public stand, it does make it complicated to try to say, so if we take that stand, what are going to be gaming it out? What are the follow-ups that are going to come out of that? And what are we prepared to do that would make a difference?
DS: Yeah, I think that’s such a good point because putting a statement out about gun violence, it has to go beyond saying we’re against gun violence. That’s basic, that’s a default position, right? Nobody is for gun violence. So then what, where do you go from there?
LA: And then I guess the other thing to think about with that is that okay, when we’re making this statement, what action are we prepared to back it up with from our organization? How are we going to constructively contribute toward this, other than saying these guys should do this or these guys should do that.
It’s like what, if leadership means leading, means doing something that is helping to solve the problem versus pointing fingers at other people and saying that the problem’s with them. But for a healthcare organization if you really are seeing it as a public health crisis or public health emergency, public health issue at least, then what can the healthcare organizations uniquely contribute to it that other organizations can’t?
DS: So yeah, I think it makes a lot of sense. And so for marketing and comms folks, it’s helping to guide those conversations. You’re saying supporting leadership in kind of helping to push leadership towards those specific actions and commitments.
And so making sure that the words and the actions match up, and I think there is a unique responsibility and opportunity for marcomm folks to be able to do that; to look at what is being said and then say are we, how are we going through this? And working with operations and clinical and finance to say let’s get everything lined up so that when we say “here’s our statement,” we can also then come in and say “here are the things that we’re doing next.”
LA: Yeah. And we’re prepared to deliver and we’re going to execute on it and yeah. And to do it in a way that doesn’t inflame the situation more, as I said assumes good intentions on behalf of the people that are engaged in the conversation so that it doesn’t devolve, as you said.
DS: Let’s look a little more specifically now at an individual incident.
What about on sort of the backend of a situation that’s going to inevitably, unfortunately, lead to people criticizing your response?
It’s just, it’s what happens. People want something different than what they get by default. And so is there anything that folks should think about saying or not saying in response to potential criticism about what they said, how they handled it, et cetera, et cetera?
LA: I think just humanizing the people who are involved in the response, just emphasizing that we’re all torn up by what’s happening here and we’re doing the best we can in the moment to be able to give people the information that they need and deserve and want, while also protecting the privacy of the, we’ve got HIPAA, we’ve got all these other issues that we need to deal with as well.
And I think the big problem we’re seeing in society in general is just a lack of empathy. A lack of being able to see from the perspective of those involved. And so by humanizing, even this might be a place where the people who are involved in telling the story, maybe even featuring them in some of this, telling that story of what it’s like to be dealing with a situation like this. Because especially on a, if you’ve got a social platform where they see the organization’s icon is the response to you and it’s not coming as a real person, then it feels disembodied. It could be an AI bot on the other side that’s responding to you. So creating that more warmth, more personal bonding there, I think is something that yeah, particularly in the aftermath that you might help people understand that nobody signed up for this, this wasn’t part of the…yeah, you signed up for it and you handle things as they come in, but it’s challenging for everybody involved.
DS: I love that advice for just humanizing and bringing the people who are behind those accounts, the admins, putting their names and faces potentially behind it. I think that’s really cool.
Okay, Lee for the last segment this was a question that we got sort of through some of our client-facing folks here at Jarrard and I thought this was actually a little bit tangential, but it’s really, yeah, an interesting, the different types of crisis response.
And I thought we could talk about it here a little bit, you know, call it the question from the community, is when do you activate a response to something that’s been said on social media? And again, kind of goes back to what we’re just talking about when people come after you verbally. Not thinking here about a negative review or, oh, I wish this had been better or the parking was crap, but just somebody who’s really upset, getting a little bit loud, you know? So is there a framework or a rule that should inform when you stay quiet, when you go public, when you respond to people directly? That mini reputational crisis.
LA: It’s a sort of a mini Hippocratic oath for political, for communications, for online: don’t make it worse. So first you just need to make the judgment: is this going to amplify, is our engagement with this going to amplify it and spread it to a broader audience than if we tried to deal with it in another way?
I think always, if there’s an opportunity to reach out and connect with a person to try to take that discussion offline, to try to identify if there’s a way to face to face, human to human, be able to work through it, that’s a win. Or if you’re able to.
There’s sometimes that’s just not going to happen. There’s just a level of animosity built up. That’s where blocking comes in, and on some platforms that’s not available, but you see that happen sometimes on Twitter. I can say I’ve never blocked anybody, I’ve never had to block anybody, but you see sometimes that with muting conversations on Facebook or whatever, that sometimes people have had their say, you haven’t muzzled them, you haven’t stopped them from being able to express themselves. So it’s not de-platforming them, but it’s also saying, you know, if somebody is determined…there was a, I think it was Winston Churchill says a fanatic is someone who can’t change his mind and won’t change the subject, but if you’ve made the judgment that there really isn’t any winning this person over, that at some point you just need to politely agree to disagree and disengage from it. And then where of course there’s, if it’s a patient concern, there’s always the patient privacy HIPAA issue. You don’t have the full ability that the patient has to be talking about the situation because that’s their private information and they can be, they can disclose whatever they want and you’re limited on what you can do.
So that’s where you have to be very cautious in where you’re going to engage. Always trying to deescalate if you can. But at first, just making sure that you don’t add fuel to the fire.
DS: Okay. And so that really does tie in, I’ll retroactively tie it into the second point that we were talking about, where you saying just humanize it, try to make those personal connections and talk about what happened.
LA: Yeah. It’s amazing what people will say by email that they wouldn’t say face to face, and if there’s…and just offering an opportunity to say hey, could we get together and talk about this? And I think that face to face communications is an underappreciated and underutilized tool.
DSh: Alright. Thanks, Lee.
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These past couple of weeks have elevated (again), the urgency for action on gun violence both as a public health issue and local crisis.
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Welcome to DigitaLee, the podcast for healthcare marketers, where we look at the digital news, tools, tips and tricks for effective healthcare communications. This week, David Shifrin and Lee Aase talk about the news that Netflix is cracking on their long-standing policy of going ad free. Then Lee gives an update on the rent versus own debate – and that’s with regards to blogs and social media, not the housing market, although that might be an interesting discussion too. Finally, they close by talking about Lee’s latest venture the HELPCare Clinic as an example of how digital tools can help personalize health care.
Listen and subscribe to the podcast, or read the transcript below.
Read the Transcript
David Shifrin: Well, hey Lee, going to kick off this week with the story about Netflix and streaming platforms. I almost bypassed this story because when I was looking around for digital healthcare marketing and saw this story about Netflix, I thought it was going to be just riding the coattails of all the discussion around Netflix.
And then I realized that it was from MM&M – Medical Marketing and…now I’ve forgotten what it is. What?
Lee Aase: Medical Marketing and Media.
David Shifrin: Medical Marketing and Media, they also rebranded not that long ago, I like their new logo. Anyway, despite the fact that I can’t remember what the 3 Ms stood for, it’s a solid site. They do some really good work. And so I thought it’d be worth clicking into it. The upshot of the article is that with Netflix now considering advertising, that could potentially change the game for companies looking about, looking at advertising in particular. I thought the really interesting point was that with economically thinking about this potential recession that we may be looking at, that is going to change sort of the ad spend and may open up some opportunities for smaller and mid-sized businesses to get in the game.
Lee Aase: Yeah. I just think it’s an amplification or it’s a multiplication of the number of places where advertisers can be, you know, and that as the continual fragmenting of the audiences, I mean, previously the Netflix audience has been inaccessible. Once somebody’s locked into Netflix, once they’re watching it, they’re uninterruptible and that’s actually been part of, a big part of the appeal as well is that people are able to watch things without being interrupted.
So, figuring out how that works within the Netflix platform will be interesting. But so many of these streaming services that are…Netflix had its 200,000 subscriber loss, and I think some of the others, being so many of these services that’ll supply demand. And especially if there’s an economic contraction that may open up space for smaller players to be able to get access to get their content into some of these niches that might fit really well with what their strategic goals are.
So I think it’s, yeah, the technology that the evolution of these platforms and their being ready to explore the ad supported, or at least partial ad supported, element is going to create some opportunities.
David Shifrin: How much do you think healthcare organizations should pursue this? And I don’t have numbers on this, but just thinking about my own viewing habits, which are primarily streaming, but I do watch regular or cable TV, I see…I can’t think of really any healthcare. I see some, I do see some pharma ads on streaming.
But you know, if I see an ad for Vanderbilt, my local hospital, it’s going to be on a local channel or on cable. It’s not coming through on an ad on Peacock, for example. So you know, how much value is there, and you’re talking about the audience fragmentation, is it worth a local hospital trying to get hyper-local targeting?
Lee Aase: I think that just depends on it might relate to what the initiative is. And is there a particular type of program that aligns really well with, we talked in the previous episode about some of them, diversity inclusion topics and initiatives.
There may be some places where if you’re able to get hyper-local targeting within these platforms, in addition to then content targeting, that you could find… I’d say there’s some opportunity. I’m not saying stop everything else you’re doing and pursue this, but it’s definitely something worth watching.
And I think the folks that have the most money to spend on it—the pharma folks—they’ll be the pioneers in that, I think. And as we in the provider space, in the hospital space, see what’s what they’re doing, I think that’ll spur some thoughts and some innovation among some of the marketing leaders to say, Hey, yeah, we could, this might fit for this particular initiative.
So it’s worth keeping an eye on.
David Shifrin: For the trend, I wanted to ask you about the current state of play on renting versus owning. And as I produce the content for Jarrard, we have a blog, we have a LinkedIn presence, and thinking about how we balance all these different platforms and where to focus.
So I think conventional wisdom for a lot of years is that organizations that are producing thought leadership and content want to own the platform. So that algorithm changes, any other kind of rule changes, aren’t affecting your ability to get that information out there, which is something we see with social media sites all the time, right?
Facebook changes their algorithm about every 10 minutes and it constantly changes the ability to be visible. But at the same time, there’s a lot of people on LinkedIn. There’s a lot of people Tik Tok. So how are you thinking about reach versus SEO, renting versus owning, website blog versus social media, et cetera.
Lee Aase: Yeah. I actually think of it as renting and owning. I think it’s like, you need to have the home and then you need to have the apartment in the, in the downtown or whatever, you know, it’s like, you need to be in both places and that’s actually a really helpful thing to be thinking about.
Because my bias has been toward having the control, that you need to have a home base. It’s important to have that, but I also recognize that the—like LinkedIn, for instance—with the thought leadership when you’re posting long form or longer form content, instead of just a link to your blog post you get readership there with people who don’t want to leave the app, and so you’re getting some impact from that. So I think being able to have maybe different versions of things that are in LinkedIn versus on the home base, maybe it’s an extended excerpt that you’re doing on LinkedIn or some content that is bespoke, as they say, for LinkedIn…I wanted to use that word, cause I’d never gotten it before and it’s…
David Shifrin: It is. It’s a very, it’s like a, it’s a sort of a…
Lee Aase: A super fancy word.
Yeah, exactly, yeah.
David Shifrin: You’ve got turnkey and you’ve got bespoke.
Lee Aase: Yeah. Very good.
David Shifrin: Yeah. And something that we’ve been looking at recently on LinkedIn is their newsletter feature, which is not new, but it’s been slowly rolling out, and so we recently on our Jarrard account got access to it. And so I’ve been cross posting a lot of our content there, and it is effectively a secondary blog that people can subscribe to. It does seem to hit some folks who aren’t necessarily always seeing our content otherwise.
So I think it’s a good thing.
Lee Aase: Right. Yeah and you want to go where the people are. And if to the extent that you’re putting content in a place where it can be liked and commented and shared…in addition, just the convenience of reading it on platform versus having to click off to your website.
We have goals that we want to get people to our website; that is part of our core ideas. That’s how people sign up and like, they join with us and having a blend I think makes a lot of sense.
David Shifrin: Then finally for this week’s philosophical tip or philosophical discussion—philosophical might be little bit too lofty of a term but whatever—
Lee Aase: Yeah.
David Shifrin: I’ve been thinking about navigating the intersection of digital tools and channels with the really personal, intimate nature of healthcare. You know, there was something in the article that we just talked about, the MM&M article, about how advertising isn’t really meant to be hyper-customized because you’ve got to reach a broad audience, it’s got to be general. But healthcare is ultimately the most personal thing that you can have. It’s literally somebody touching you to help you through difficult times. And so I was thinking about this and then thought this is perfect because you’ve opened a clinic. You are doing this, you have an extensive career in the digital space and are now in a very personalized clinic. So how are you thinking about that balance of personal with something that’s a little bit more hands-off through a screen?
Lee Aase: Yeah, a big focus is that we want to make it so that technology is the facilitator for the personal, the technology isn’t a barrier technology, isn’t something that just enables us to scale. It does enable us to reach more people, does enable us to target to a community.
But also, we don’t want the technology to be something that gets in the way of those human interactions. We want it to be the enabler and facilitator of those reactions. And a lot of that is if it’s convenient for the patient to use video conferencing, if it’s a way that we can see them more easily, like they’re feeling sick and they don’t want to come in, that’s telemedicine: in the post-pandemic era, isn’t a like, ooh, that’s a whole new thing, but is an application of digital technology in a way that is more human because it is more individualized. It’s about that intimate relationship. So I’ve been blessed, pleased at how the technology, used in the right way, can be really that facilitator to make some of the things that would have been more difficult to do previously, much easier.
And so it’s been an exciting time to be starting something new because of the way that…well we talked earlier in, maybe it was in the previous episode? about some of the transcription tools and things like that that are able to be harnessed and used within a practice to just take it to that… take away some of the grunt work, where technology can take some of that effort out of the way that would enable then the human, the more direct human interaction at a higher level.
David Shifrin: Yeah, just the grunt work. That’s literally what you just said.
Lee Aase: Well, yeah, let me just, just let me just throw in another thing. So one way that we’ve used this is…so I mentioned previously Dr. Dave Strobel is our our medical director, our founder of the clinic, and one of the things he does is go into depth, great depth in describing conditions.
He’s an educator, he’s a teacher at heart, he loves to help patients understand what’s going on in their body and why and how all of this stuff works. And that’s part of the reason we have a one-hour appointment as our basic unit of seeing patients. There’s a lot of stuff that he says a lot of times, and so if we can use the vide to capture some of that stuff (and that’s part of what we’re doing), our production is like, this is the thing that you’ve said dozens of times, hundreds of times to people as you’re describing metabolic syndrome or the various other conditions. He’s got a video that we did on baby table manners, things like that in terms of how to get your kids eating solid food and kind of the right order to introduce foods.
You know, he could go through that every time. And he has done that for 30 years with patients, but if we can capture that and then say, okay, these are online video modules that are of specific, can be a specific interest to different elements of the practice, members of the clinic, then when they come in, they can have watched the video and they can go deeper and they can probe on the questions and we can say, what didn’t you understand? Or what could I explain better? And that helps us make the next, maybe add another module. If we find out that another video to the series, if we’re finding out that it isn’t communicated as clearly as it could be.
So I think that’s one way that if you can take the broader topics where there is some, it’s still pretty specific, it’s still pretty focused and in-depth, but then enabling to go even deeper within the individual patient visit.
David Shifrin: That’s where you go from a turnkey video series to a bespoke one hour appointment.
Lee Aase: Exactly, there we go!
David Shifrin: How do like that?
Lee Aase: Great stuff. Oh, how about that? You are a trained communicator and a PhD to boot.
David Shifrin: I’m just writing my notes here, getting my points in. All right. Thanks, Lee. It’s fun as always.
Lee Aase: All right. Appreciate it. Talk later.
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The market tumbled and gridlock at the FTC looks to be broken. Get ready for a wild ride in the world of healthcare consolidation.
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Healthcare mergers and acquisitions are having an interesting moment and were quite the topic of interest at April’s American Health Law Association’s Health Care Transactions Conference. As has been reported numerous times over the past year or two, the number of deals has dropped but the average size has gone up. Questions about how the current administration and FTC would approach consolidation have been a talking point across industries since now-President Biden won the presidency. Some massive deals go through, others get scuppered. And in the middle of these moves by traditional providers, private equity continues to evolve its role in healthcare delivery, bringing organizations together and backing them with capital and operational guidance.
With that backdrop, we circled back with a few of our AHLA friends to get their impressions of the current healthcare M&A environment. Specifically, we asked them:
- What were your top two takeaways from the event or conversations surrounding it?
- What was the biggest surprise?
- In light of the above, what are the top considerations for provider organizations to successfully navigate a transaction today?
Here are the topline takeaways. Quotes from the experts follow.
Themes
Uncertainty and concern around regulatory scrutiny of deals remains. And it’s not just from the FTC, but from states, as well.
The cost and shortage of labor, particularly travel nursing, is having downstream effects on the cost of doing business and patient outcomes.
Surprises
In the PE world, valuations are rising but not always for reasons one might expect. In many cases, multiples are pushing valuations as much as margins are.
It’s not just small, independent organizations that are being buffeted by a tough financial outlook. It’s a rocky landscape even for large systems, and that will likely be seen soon in M&A volume.
Across the board, seasoned industry veterans are expressing a notable level of concern thanks the rising cost of doing business and the added scrutiny on transactions.
Advice
Running a clean, organized transaction process is more important than ever.
Get counsel involved early to stay ahead of regulatory roadblocks.
Make the case for a deal – clearly and early.
Rex Burgdorfer
PARTNER
Health systems we talked with have been upended by the trend of traveling employees, especially nurses. In many cases, the cost structure of the organization has risen by 20 percent. The impact can not only be felt in the financial statements, but also in quality and safety measures. Temporary staff are often working in unfamiliar departments, with new equipment, and without the muscle memory on a team. The New York Times covered this well a few ago:‘Nurses Have Finally Learned What They’re Worth’
What were your top takeaways?
Health systems we talked with have been upended by the trend of traveling employees, especially nurses. In many cases, the cost structure of the organization has risen by 20 percent. The impact can not only be felt in the financial statements, but also in quality and safety measures. Temporary staff are often working in unfamiliar departments, with new equipment, and without the muscle memory on a team. The New York Times covered this well a few ago: ‘Nurses Have Finally Learned What They’re Worth’
What was the biggest surprise?
The degree to which historically high-performing systems have been shaken in 2022 was a surprise. While we don’t yet see the impact on M&A volume statistics, I think we will in the coming quarters.
What are top considerations to successfully navigate a transaction
Transparency is key. Designing and implementing a competitive process to provide fiduciary decision-makers with a basis of comparison has always been central to demonstrating to regulators (e.g., state attorneys general) that the terms and conditions achieved in a particular transaction are “fair.” Where a lot of systems go wrong is not using the LOI stage to proactively communicate the rigor of the market clearance, the rationale behind the combination and merits of the partnership to AGs.
Krista Cooper
SENIOR HEALTHCARE ATTORNEY
What were your top takeaways?
My biggest takeaways were related to the conference’s antitrust track. Essentially, between the FTC’s new “holistic approach” to merger review and the increased scrutiny on affiliations, we can expect more vigorous reviews on the federal level. When you layer that with new state laws requiring pre-transaction notifications, the shifts could have material impacts on the approach and timing of some transactions.
What was the biggest surprise?
Given the pace of PE transactions in 2021, I was surprised to learn that unspent capital is still near record highs.
What are top considerations to successfully navigate a transaction
Prepare and prepare some more! Provider organizations considering a transaction would be well served to understand their organization’s operations, the market conditions, and the basics of the regulatory landscape. Deals are still moving very quickly whenever possible, and being well organized with good professional support can make a big difference.
Jay Greathouse
PARTNER
What were your top takeaways?
Whether it is on the equity and funding side, or on the compliance side, healthcare transactions are under a tremendous spotlight from every level. Couple this scrutiny with a greater demand by sellers for creative upside capture (e.g., earnouts, aggressive liability limitations, representation and warranty insurance growth, etc.), and there is significant pressure on what the market will support in transactions.
What was the biggest surprise?
Healthcare transactions are always under scrutiny, so many practitioners see it as simply part of the practice. But hearing so many seasoned practitioners raise the flag on the new long-look landscape was eye-opening.
What are top considerations to successfully navigate a transaction
Transaction fundamentals matter more than ever. That means good governance behind an organized, clean transaction process being run by reputable counsel. Add in the antitrust scrutiny and greater examination of transitions, and I think we will see an uptick in deals that stall, fail or unwind – and that’s when the quality of the transaction will be examined in the public and courtroom.
Jay Harris
PARTNER
What were your top takeaways?
The keynote speaker discussed the returns on investment for private equity investments in healthcare. One of the statistics mentioned was that almost half of the returns enjoyed by PE investors in healthcare in the last decade have come from the increased multiples. Meaning, the improvement in multiples provided as much of the return on investment as revenue increases and margin improvement combined. Can we expect multiples to continue to increase over time from current levels?
Michael Ramey
PRINCIPAL
What were your top takeaways?
I heard an overall uncertainty, and some anxiety, regarding the level of anti-trust enforcement going forward. The administration has definitely communicated an increased focus on healthcare transactions, but the level of enforcement beyond acute care seems to be uncertain.
Also, an interesting fact conveyed by the keynote speaker is that valuation creation in private equity-backed entities, historically, has been through revenue and multiple expansion, not margin expansion. That leads to the question if such growth is sustainable.
What was the biggest surprise?
The biggest surprise to me is the prior noted comment regarding the lack of margin expansion in private equity-backed deals. This runs counter to the MSO model of creating efficiencies through scale to generate incremental value.
What are top considerations to successfully navigate a transaction
I think the tried and true approach of involving competent healthcare legal counsel early in the process to navigate regulatory and transactional landmines remains key, along with involving healthcare-specific financial and compliance advisors. Several stories were shared at the conference of bad outcomes when this isn’t followed.