A Practical Guide to Data-Driven Healthcare M&A

Introduction

Data tells the real story in every healthcare deal. Here’s how top acquirers avoid common traps while increasing both yield and operational stability.

Key Elements of an Actionable Diligence Framework

• Workflow Mapping: Track patient encounters, billing, and all operational handoffs end-to-end.
• Core Metrics: Go deeper than group averages. Examine net collection rate, denial rate by payer, AR >90 days %, payor mix shifts, productivity by provider/location, and audit frequency.
• Technology Review: Are EHR and billing/reporting solutions integrated? Are “shadow” systems or spreadsheets in use? If so, you’ll face workflow blind spots and risk.
• Staff & Accountability: Analyze FTE metrics, staff turnover, and who owns key results. Many providers are weighed down by unnecessary messages and failing to work “at top of license,” hurting both morale and productivity.

Actionable Checklist

• Require AR and denial breakdowns by payer and location.
• Ask if dashboards or reports reflect real-time activity, not just month-end summaries.
• Specifically inquire about pending tech migrations and imminent payer contract renegotiations—these often hit post-close.