The healthcare industry faces major headwinds in the coming decade, and many players will be forced to endure numerous opportunities to adapt. The challenges will be many and diverse—changes in the legislative landscape, technological advances, lifestyle developments, and pharmaceutical and therapeutic inventions—will converge to create a very dynamic environment.

However, the projected repeal of the Affordable Care Act (ACA), commonly known as Obamacare, and replacement legislation will shape the debate and may lead to significant improvements in the provision of healthcare in the...

The future of healthcare in America has never been so uncertain. Amid continuing political tensions, payer and patient pressures, and changes in the way that care is delivered, there doesn’t appear to be a clear and distinct path forward. And there may not be for quite some time, given Congress’ recent unsuccessful attempt to replace the Affordable Care Act (ACA).

Fear of the unknown is creating a great deal of stress for individuals, hospitals, and healthcare providers alike. What is known, however, is that the healthcare industry will face significant change and challenges in 2017...

The healthcare industry presents challenges for operators, landlords, lenders, vendors, and others doing business within the sector. The industry is virtually always in turmoil amid reimbursement rate modifications, new enforcement efforts, and the ongoing evolution of the delivery of medical care.

With the advent of the Affordable Care Act (ACA), certain players in the industry have faced new financial pressures from accountable care organizations (ACOs), for example. An ACO is comprised of a group of healthcare providers, such as physicians, hospitals, home health agencies,...

This is the first in an occasional series of roundtable discussions by Certified Turnaround Professionals (CTPs) on issues impacting the turnaround, restructuring, and distressed investing industry. In this installment, Ruediger (Rudi) Mueller, CTP; Robert D. Katz, CTP; and Edward J. Sanz, CTP, discuss some of the problems facing distressed hospitals. Mueller moderated the discussion.

Mueller: Our topic today is hospitals. That is obviously a very large topic area, so we will limit ourselves to a few...

A recent bankruptcy case in Southern California has raised significant questions about the limits, if any, on the power of state governments in approving or rejecting sales of assets of not-for-profit healthcare industry entities. With Congress focused on repealing the Affordable Care Act (ACA), which some experts suggest would reduce revenue to hospitals by more than $165 billion between 2018 and 2026,1 this issue is likely to arise repeatedly across the country moving forward. Increasing financial distress in the U.S. healthcare industry, which includes more than 2,800...

The healthcare transaction environment is unique in many respects, compared to most other industries, making it challenging to understand for the casual observer and experienced professional alike. Depending on the buyer and seller, geographic location, and type of business, there are a myriad of nuanced business-specific issues and state and federal regulatory considerations that can dramatically affect deal structure, terms, and ultimately the valuation at which a transaction can occur.

In most industries, buyers can be classified as financial or strategic. The corresponding...

Over the past decade, hospitals have been busy acquiring physician practices. This article provides an overview of this trend, considers the reasons behind it, describes some risk factors relating to this shift toward physician employment, and then suggests some safeguards for health systems and physicians to consider in structuring and monitoring their employment relationships.

Hospital alignment with physicians in existing practices can be achieved through practice acquisition structures such as asset or stock purchase agreements, mergers, and joint ventures. The hospital or a...

As healthcare facilities reorganize, re-engineer, or otherwise optimize their revenue cycle management, an unfortunate by-product is a checklist of potentially hazardous oversights encountered in the field.

A rural community hospital, for example, experienced major cash flow shortages that turned out to be due in large part to attempting to implement a multimillion dollar healthcare information management (HIM) system replacement without adding any staff. IT and non-IT employees alike were performing critical work as mere add-ons to their already full schedules.

The hospital...

In most industries, certain commonalities in business operations make it possible for an outsider to learn the fundamentals reasonably well in a relatively short period of time. There is, however, one industry that seems to be struggling right now where this is not the case—healthcare.

For turnaround consultants whose work in the past has focused mainly on manufacturing, working effectively with clients in the healthcare industry will require learning some new tricks. Working with some experienced healthcare operators and questioning processes and the reasons behind them can also...

If insolvency and healthcare were elements on the periodic table, the isotope resulting from their combination would be highly unstable.

Healthcare differs from other economic sectors because of the regulatory climate that pervades every aspect of the industry. Many industries are highly regulated, but few are regulated in similar depth and have the myriad competing interests that healthcare brings to the surface.1

When it comes to insolvency generally, the rule of thumb is that financial concerns are paramount and drive the decisions of courts involved in the...