The Pros and Cons of Mergers and Acquisitions

Review the following scenario:
You are the chief executive officer (CEO) of a 200-bed nonprofit community hospital that serves a rural community with a population of 50, 000. The demographics include a median household income of $38,000. Currently, slightly less than half of the population (45%) has employer-sponsored insurance, with 35% having a combination of Medicare and private supplemental insurance and the remaining 20% being uninsured. The population is aging, with 40% of the population expected to reach Medicare eligibility age within the next 5 years, where employer-sponsored insurance will shift to Medicare or a combination of Medicare and other supplemental insurance.
A group of internal medicine physicians specializing in geriatric medicine, including joint replacement surgeries, is looking to expand their services. The physician group has approached the hospital about merging their services with the hospital and expanding the hospital to include an ambulatory care center and outpatient surgical center.
Based on your analysis of the scenario, explain the potential risks and benefits of the merger. Be sure to address the following:
What, if any, opportunities are there for cost control if the decision to merge with the physician group is made by the hospital?
What are some of the changes in Medicare reimbursement that could affect the long-term success of the merger?
Would the community hospital be better served by countering the physician group?s offer to merge with the hospital or would acquiring the physician group better serve the hospital?s interests?
Describe any ethical considerations that could influence the CEO?s decision.
Write a 3-page paper in Word format. Utilize 2?3 SCHOLARLY sources in your research. Your paper should be clear, concise, and organized; demonstrate ethical scholarship in accurate representation and attribution of sources; and display accurate spelling, grammar, and punctuation. Apply APA standards to citation of sources.

Assignment 3 Grading Criteria
Assignment Components
Proficient
Maximum Points
Identify and describe opportunities for cost control if the decision to merge with the physician group is made by the hospital.
The identification for and description of cost-control opportunities were thorough. Used a systematic approach to identify the cost-control opportunities to differentiate between them, and aligned and supported assertions with authoritative sources. Used more than one authoritative resource to support stakeholder identification. Research extended beyond the textbook.
24
Identify and describe some of the changes in Medicare reimbursement that could affect long-term success of the merger or acquisition.
The identification for and description of Medicare reimbursement were thorough. Used a systematic approach to identify and describe changes in Medicare and the potential financial impact of the acquisition or merger. Supported assertions with authoritative sources. Used more than one authoritative resource to support stakeholder identification. Research extended beyond the textbook.
24
Defend your position about whether the community hospital would be better served by countering the physician group?s offer to merge with the hospital or acquiring the physician group.
Provided a thorough discussion in support of either a merger or an acquisition. Described the pros and cons of both a merger and an acquisition. Used more than one authoritative resource to support stakeholder identification. Research extended beyond the textbook.
24
Describe any ethical considerations that could influence the CEO?s decision.
Provided a detailed description of ethical considerations from CEO?s perspective. Further, potential impact on the reputation of the hospital and the community is also considered. Supported assertions with authoritative sources. Research extended beyond the textbook.
20
Academic Writing

Write in a clear, concise, and organized manner; demonstrate ethical scholarship in appropriate and accurate representation and attribution of sources (i.e., APA); and display accurate spelling, grammar, and punctuation. Use of scholarly sources aligns with specified assignment requirements.
Wrote in a clear, concise, and organized manner; demonstrated ethical scholarship in appropriate and accurate representation and attribution of sources; and displayed accurate spelling, grammar, and punctuation.
8
Total:
100