Your Primer to Healthcare Mergers and Acquisitions

How To Save Your Addiction Rx Company From The TrumpCare Tsunami

Dec 6, 2016

by Tom Schramski

By Tom Schramski, PhD, CM&AA

Volume 3 Issue 25, December 6, 2016

Going forward into the Trump presidency, one thing is certain: US healthcare insurance will change. HHS Secretary nominee Tom Price is a vehement ObamaCare critic. When he takes the reins we can expect a revamp of both the Affordable Care Act (ACA) and Medicaid.

The most likely change will be an attempt to control costs by restructuring Medicaid from a federally-run program into a set of block grants at the state level. If history is any guide, this will result in reduced reimbursement for treatment services, which is very bad news for Addiction Rx providers and the communities they serve.

Given the seriousness of the situation, we recommend that Addiction Rx providers take immediate steps to 1) apply political pressure to prevent a move to block grants and 2) position their company to adapt quickly if and when that change takes place.

To apply political pressure, contact your U.S. senators and member of Congress and emphasize that the rampant growth of addiction in your state is a crisis situation to which the proper response is an increase in funding, rather than seeking cost savings.

You might also ask your clients to do the same, since they're the people whose health will be at risk if the new administration implements block grants.

At the same time, take immediate action to position your company to successfully pivot and adapt to any changes that might be coming. Specifically, we recommend the following:

  • Research your marketplace: Successful action will require an honest, and possibly brutal, assessment of what options are available to you and what you may need to do to continue to thrive if the government implements a capped reimbursement model (such as block grants).
  • Create a response plan: Be ready to implement and respond to multiple reimbursement and contracting scenarios, whether in-network or out-of-network, with accompanying projections and associated revenue requirements.
  • Develop best practices: Whatever happens, you want to be the most competitive company in your region. For example, you may want to pursue additional external accreditation that can be advantageous in a managed care environment.
  • Prepare your technology: You will need reliable and flexible data capabilities that allow you to measure and tune your entire operation, from internal operational outcomes to external funding requirements. Do not put this on the back burner.
  • Expand your network: To protect your company and position it effectively, identify and cultivate potential affiliations and partnerships.

Above all, you cannot afford "hunker down and hope for the best" as a response to TrumpCare. Instead, you must take action NOW to ensure that you're ready for the changes to come.

Tom Schramski

Tom Schramski PhD, CM&AA


Tom was the Founder and Managing Partner of VERTESS. He was a Certified Merger & Acquisition Advisor (CM&AA), consultant, and Licensed Psychologist with over 35 years of very successful national experience in the healthcare marketplace, including co-founding and building a $25 million behavioral health/disabilities services company. Tom represented sellers and investors across the healthcare spectrum and was recognized for his executive leadership in the 2005 Entrepreneur of the Year issue of Inc. Tom passed away in December 2018.

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