Examples of a financial merger and an operating merger
Course:- Financial Management
Reference No.:- EM13693362

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1. Some of the articles available on the matter of health care mergers bemoan the absence of a patient/consumer role in the decision-making process. Should consumers have a role in the decision of "to merge or not to merge"? Where/how could that role be played?

2. Explain the difference between and give examples of a financial merger and an operating merger.

3. Explain the difference and offer an example of each - a joint venture and a merger.

4. Explain the difference between and give an example of each a horizontal merger and a vertical merger.


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Having gone through a fairly large-scale merger between two faith based organizations I have some strong opinion regarding this topic. To provide you some background these two organizations were made up of hospitals in six states and included opposite side of the country. Initially our local organization was excited but hesitant of the merger. At that time in the late 90’s medicine was and still is to some extent practiced regionally.

Our particular hospital was a Tersherariey hospital in a fairly large town of roughly 200 thousand. The prior organizational structure allowed our system local control and afforded the hospital great latitude to address issues of growth, quality, standardization and human resources. Furthermore the hospital having been in the community for over a hundred years was the largest employer and held in high regard by the community. It is important to know that our health system was very profitable and the locations of the hospitals were in areas of traditionally high reimbursements from the payers.

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