Your Primer to Healthcare Mergers and Acquisitions

Author: Rachel Boynton

Exit Planning
Planning for Partnership Problems: Why Your Business Depends On It

I have recently encountered a few situations where partners in a business do not agree on the current plan for the company, with one partner(s) is ready to sell while the other(s) is not. This is often a situation unanticipated by entrepreneurs when they decide to become partners in a business. This is not surprising. After all, the focus at the time of the partnership is usually the start of the business rather than its potential or eventual conclusion. Thus, there is rarely a conversation about the end game — the exit when one or all owners are ready to retire or move on to the next start of their career.

A business partnership where owners have equal stake in the company can lead to a plethora of problems from disagreements in operations to exit strategies. Whether you're just starting out or already functioning as a super team, it's never too early to discuss the "what ifs" for future decisions. But wait too long and it can't be too late!

Mike Gillette is a friend, colleague, and a lawyer and shareholder at Polsinelli (mgillette@polsinelli.com) who has helped many of my sellers transact. I asked him to share some insight from a legal perspective into how co-owners of a business should address issues that develop around disagreement about the future for the company. The following section summarizes his thoughts.

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Exit Planning, Market Trends
How to Keep COVID-19 From Infecting Your Company's Value

The world of healthcare mergers and acquisitions (M&A) has experienced a significant rollercoaster these past two years, primarily due to the events of COVID-19. Before the pandemic locked down our communities, M&A, particularly in the health and human services space, was experiencing a significant increase in activity. This was caused by several factors. Among them: Existing organizations — or strategic buyers — were witnessing the benefits of growth through acquisition to compete with larger businesses and prepare for managed care, while private equity investors saw this field as one worth investing in. With an excess of cash reserves (i.e., "dry powder"), these private equity investors started spending.

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Healthcare Sectors, Market Trends
Nurturing Women Leaders to Strengthen the Human Services Industry

There is a struggle these days to find reliable and competent leadership. In many ways, the human services industry exemplifies the challenge. Despite an abundance of books, speeches, and guides that focus on the creation of good leaders, their absence persists.

This persistence, however, is not a result of our inability to pull good leadership from thin air. Rather, it's about our inability to simply look at the colleagues around us. Good management is cultivated, not found. This isn't a radical claim and is a concept I'm sure many are familiar with. But few, it seems, have managed to successfully cultivate new leaders. A complex reason why this challenge exists within the human services industry: gender disparity, especially for women of color. Human services is an industry that should, above all things, champion equity and equality for its clients/consumers — no question. Yet, if those same principles are not reflected in management, a company may find itself ill-equipped to champion anything. 

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Exit Planning, Healthcare Sectors
Difficult Conversations: Explaining the Sale of Your Human Services Company

I was recently speaking with one of the sellers I represented about the sale of his provider agency. I asked him what he thought was my most significant value during his long selling process. Without skipping a beat, he said, "'The emotional support you provided to me." He explained that it was helpful to talk with me when things got stressful or even a bit scary since I had been through the process of selling my own company.

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Healthcare Sectors, Market Trends
Human Services Operators: Don't Apologize for Making a Profit

As human services business owners and operators, we should not apologize when our businesses earn a profit. Rather, it's time to stop shielding our staff from the important discussion of budgets and bottom lines. They should have some exposure to the budgeting process and understand the need for a healthy bottom line.

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Exit Planning, Healthcare Sectors
Selling Your Human Services Company: 8 FAQs and Their Answers

I often receive calls from owners of human services companies who say something along the lines of, "I don't know what I don't know" concerning selling their company. What's important to understand is that it's okay not to know everything about selling a company. It's a complex process, which is why most successful sales involve a team working together toward a common goal.

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Exit Planning
The Value of an M&A Advisor From Those Who Used One

At VERTESS, we are often asked what value we can bring to sellers as they decide to sell their business. We often talk about our large contact list of buyers and our experience as a business operator/owner and seller or as a merger and acquisition (M&A) advisor.

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Exit Planning
Planning The Exit From Your Business

For anyone running a business, it is always important to develop a succession plan. Who will take over leadership if someone moves on? How will you keep the cogs turning when you have a change in control? Yet many small- to mid-sized business owners are so mired in the details of the day-to-day operations that they don't consider such changes since they take on staff responsibilities until someone else rises to the occasion. But if you run an organization, you need to be asking yourself: Who will step in when you're ready to step away?

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Healthcare Sectors, Market Trends
COVID-19 Roundtable With IDD Leaders: Key Takeaways

In the middle of May, I had the opportunity to participate in a conference call with leaders in the field of providing support services to individuals affected by intellectual and/or developmental disabilities (IDD) during which we discussed the impact of COVID-19 on our services. This group consisted of direct service providers, area agency/managed care providers, and those who help with consulting and/or planning services. Representatives shared their current perspective of COVID-19 and how their services were affected, how they are planning for the "next phase" of communities opening back up, and the possibility of another lockdown.

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Healthcare Sectors, Market Trends
Resilience and Growth in Human Services & Healthcare During COVID-19

By mid-to-late March, we all felt the immediate effects of the "lockdown" of our communities. Some healthcare businesses stopped services entirely while others saw a large dip in those offered. Organizations with a diversified payor source probably fared better than single-source providers, everyone felt the effects. At VERTESS, we had some deals stop, some slowed or paused, and others moved along. Progress — or lack thereof — all depended on the confidence of the buyer and ability of the seller to adjust.

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Market Trends
8 Technologies To Help Your Healthcare Business Survive COVID-19

The time has come when we are all being forced to embrace technology, whether we like it or not. Before the coronavirus pandemic, some businesses implemented extensive information technology (IT) solutions to support their operations while others resisted. In these unprecedented times, we will need to not only embrace technology, but rely on it.

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Healthcare Sectors, Market Trends
Integrated Care: No Need To Fear What We Already Know

Integrated care is one of the big buzz words in the human services industry. Integrated care is fundamentally the combination of primary healthcare and mental healthcare in a single setting for the purpose of creating a team-based approach to general and mental care. As managed care becomes more commonplace in human services, payers are pressing for its providers to achieve the objectives of integrated care. As a result, providers are finding themselves tasked with the challenge of further decreasing cost while improving outcomes for those receiving support services.

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