Managing Cultures During Physician Practice Merger

By Nick Hernandez, MBA, FACHE

Medically reviewed by Patricia Salber MD, MBA

Culture is the most common reason why practice mergers fail. However, there are steps you can take to end up with a supportive culture.

There are specific steps that can be taken to ensure a supportive culture post-merger. (Photo Source: iStock Photos)

There are many reasons why physician practices merge or acquire other practices: increased market share, gaining new capabilities, diversifying a service offering, and more. It’s also no secret that mergers and acquisitions sometimes don’t go as planned.

The importance of culture in practice mergers

In my experience, culture is the most common reason why mergers and acquisitions fail. In my experience, the largest contributor to merger and acquisition failure has to do not with the business but with the people. More specifically, how we handle (or fail to address) the cultural differences between organizations, which are exacerbated by a lack of effective communication. Put another way, did leadership account for the culture or anticipate a potential culture clash?

When a physician practice is acquired or when practices merge, the decision is typically based on a physician fit or market fit, but employee differences are often ignored.