Merging and Acquiring Hospital Policies

Nina Ordinario

Associate Editor

Loyola University Chicago School of Law, JD 2024

As the number of hospital mergers and acquisitions increases, legal, compliance, clinical, and administrative staff should be aware of the challenges of consolidating hospitals. One challenge often overlooked is the consolidation of hospital policies and procedures.


During a hospital merger, larger health systems often absorb small neighborhood hospitals and private practices. In some instances, even large hospital systems will merge. There are many benefits to these mergers. For instance, larger health systems, such as those created through mergers, have greater funding and access to resources, technology, and specialty departments such as stroke, burn, and trauma centers. In addition, these larger health systems have more resources to support employee relations and provide more employee benefits, thus attracting prospective talent and increasing staffing. Another benefit of larger health systems is that patients have more provider options and can stay in-network if they switch providers or see a specialist. As a result, providers also have access to the patient’s comprehensive medical record as opposed to disconnected medical records stored at various facilities or in different electronic health record systems.

To achieve these benefits, however, hospital mergers and acquisitions must be carefully planned and executed. The merging of one or more hospitals involves more than just a real estate agreement; many challenges must be handled before, during, and after a merger. These challenges may include implementing new workflows, rearranging staffing, or unifying medical record systems. Of the challenges facing mergers, one notable yet forgotten issue is the consolidation of hospital policies and procedures.

Policy management

Managing hospital policies and procedures is one of the seven elements of a compliance program required by the Office of the Inspector General (OIG). The OIG requires hospitals to produce policies and procedures, review them periodically, and publish them for all applicable staff. The OIG specifically requires that policies and procedures should be “readily available” and “re-evaluated on a regular basis.” According to the OIG, the purpose of policy management is to “establish brightline rules that help employees carry out their job functions in a manner that ensures compliance with Federal health care program requirements and furthers the mission and objective of the hospital itself.” Policies and procedures not only educate staff on mandatory processes but also encourage staff to follow standardized protocols in their roles and provide staff with decision-making guidance. For example, hospitals may maintain policies and procedures that reflect federal requirements, such as the Conditions for Participation for Hospitals. The policies and procedures may further specify how hospital staff should perform their roles to implement and comply with these requirements.

As important as policies and procedures are to the efficient operation of a hospital, policy management is often not addressed until after a merger is finalized. Although all health facilities adhere to common practices and standards, how these policies and procedures are written, reviewed, and published may differ. For instance, some hospitals may store policies and procedures as Word documents in shared drives, whereas others utilize electronic systems such as PolicyStat. As another example, some hospitals may have executive staff review and approve the policies periodically, while others delegate the tasks to management or clinical staff. There are many ways to manage, store, and publish policies, and staff must address how to consolidate those methods during a merger, just as they do for staffing, workflows, and medical records. Without proactively addressing policy management, post-merger hospitals may face challenges with consolidating and streamlining policies and procedures. Consequently, these challenges may prevent policies and procedures from being “readily available” to staff, who rely on the published protocols for guidance, as required by the OIG.

A proposed approach

One of the ways health systems can effectively and efficiently handle the “merging” of policy management processes is by creating a team or task force dedicated to consolidating the policies. These teams may be led by compliance or legal staff if the health system has such departments. However, in the absence of such departments, the team should at least include clinical staff because they are most knowledgeable on the substantive material in their department policies. In addition, the clinical staff has a strong interest in maintaining hospital policies and procedures, especially those central to clinical responsibilities. Therefore, it is essential that clinical staff play a role in how the policies are managed, implemented, and published. Overall, having a dedicated team is also important because it helps centralize the project’s goals.

As hospital mergers increase, the way in which policies are consolidated and managed will continue to evolve. Accordingly, although there are many ways to approach consolidating policy management systems during hospital mergers, having clinical staff involved in the process should not be taken for granted.