Evaluating potential or actual compliance risks is necessary for any health care organization during a merger and acquisition. Strategic Management’s due diligence reviews assist health care organizations and purchasers to identify compliance risks that must be properly accounted for in any merger and acquisition transaction.
Regulatory Due Diligence Reviews are a vital part of risk management in any M&A deal and is complicated in the healthcare sector due to the high level of regulations that create a significant purchaser risk in acquiring serious regulatory liabilities. It involves the systematic review of an organization’s regulatory compliance status to confirm facts or details by which an acquirer can properly understand and identify the compliance risks related to the target, including potential legal and regulatory violations, corrupt arrangements with referral sources, data privacy and security issues. It differs from financial and legal reviews with the former using accounting firms to focus on financial accountability and reporting; and the latter using law firms to focus on
examining the entity’s structure, licenses, contractual rights and obligations, tax exposure risks, previous and/or current litigation, etc.
Due Diligence in Health Care
Mergers and acquisitions can be complicated for health care organizations because they operate in a highly regulated industry. Therefore, there is significant risk that a purchaser could inherit serious regulatory liabilities. Similarly, health care organizations that are seeking to be acquired or merged may not fully know their own risks that could impact the transaction.
Regulatory Due Diligence Services
Strategic Management’s health care compliance consultants are experts at conducting health care regulatory due diligence for mergers and acquisitions. Our services are provided to health care organizations that are preparing to be acquired and to organizations seeking to acquire a health care organization and can be conducted pre- or post-transaction. Our compliance consultants examine compliance program operations, regulatory compliance areas and high risks. We further assist by remediating risks identified through our due diligence services.