NatCon 15: Merge to be better, not bigger

When Crider Health and Pathways Community Health merged in 2014, executive teams used a centers of excellence template as the overarching guide to combine the various parts into a new, larger whole. Leaders from the organizations offered their best practice tips at the National Council for Behavioral Health 2015 conference in Orlando.

Why merge?

The Crider/Pathways deal began with a serendipitous meeting between executives and ultimately led to the merger of three brands, which finalized on October 1, 2014. Now, the Compass Health Network includes Pathways and Crider—two federally qualified health centers (FQHCs)—and Royal Oaks Hospital, a 41-bed behavioral health facility.

But the point of the merger was not specifically about gaining scale or rescuing an FQHC, as is frequently the case. Both centers were stable and plenty busy. Pathways was operating at $95 million in revenue and Crider at $135 million.

“All too often a merger is just about programs getting bigger, but for us, it was about accelerating change,” said Tim Swinfard, president and CEO of Compass Health and chief executive officer of Pathways.

The centers of excellence template that served as the landmark for the merger originated with the National Council, and Swinfard said the teams used a version from several years ago that outlined seven building blocks, such as customer service and evidence-based medicine. 

Laura Heebner, President and CEO of Crider Health Center, said that as Crider had grown, employees were taking on more and more responsibilities, sometimes wearing several hats. They were beginning to spread themselves thin and struggle between being specialists versus generalists as their task lists grew. They needed to find a way to maintain quality and service while also energizing the staff.

“What this merger did was allow our staff to take some of those caps off and get into the weeds and create something strong," Heebner said.

Prepare for curveballs

Swinfard said among the hurdles the centers had to consider were governance and third-party approvals. The merging of the two boards required some finesse and the deal had to spell out in advance how to handle future governance of the combined organization as well the everyday practical operations. He said the accreditation process for the merged entity required many phone calls and site visits, but in the end, the FQHC designation from the Health Resources and Services Administration ended up being the toughest approval to secure.

But it won’t be status quo, he said. The merger was meant to lay the groundwork for future innovations in behavioral healthcare.

“We probably won’t be able to get to a single IT system because of the specifics of the hospital-based care  versus the community-based care,” Swinfard said. “But what the great opportunity is in bringing these resources together is that previously, we didn’t have a SQL [structured query language] programmer, and we haven’t had staff that can write custom reporting and build integrated data bases for quality. By bringing the organizations together, we’re going to hire two SQL data reporters and they will build integrated databases so we can run data and quality reporting, which we wouldn’t have been able to do.”

He said the new personnel resources will bring Compass into the era of “big data” with crosstab-reports sourced among the entire network.

His advice for other centers looking at merging is act with purpose—perhaps using a template for an overarching vision—but also centers must prepare for the curveballs that will inevitably come along by using rapid-cycle change-management tools.

"Look at your strengths and weaknesses," he said. "Your partner is going to look back at your organization’s last three years and will have good questions, and you better have good answers. Do that evaluation of yourself every few years."

Center of Excellence Template 

• Collaborative with Community 
• World Class Customer Service 
• Integration of Health, Behavioral and Oral Care
• Clinical Focus on Evidence Based Medicine 
• Great Place to Work for Employees 
• Wellness and Recovery Culture 
• Efficient, Ethical and Effective