Merger and autonomy: reaping the benefits of both

Although often reluctant to risk loss of autonomy and control, Catholic health care organizations should consider the opportunities to accommodate local autonomy and affiliation or merger. As the acute care industry consolidates into increasingly larger systems, the price of maintaining absolute autonomy may be too high. Organizations must ask: How much autonomy can we afford? Do the benefits of complete autonomy outweigh its disadvantages in light of marketplace pressures to join into larger organizations? Alliances and joint ventures allow participants to retain a significant degree of autonomy, but long-term benefits are limited. Mergers and affiliations, however, do offer long-term benefits, and they may be structured to achieve an appropriate balance between autonomy and centralized control. By selecting among organizational and functional options, sponsors, boards, and managers can preserve characteristics they consider essential. A broad range of organizational and functional options is available, which ensure flexibility if used correctly. Organizational options include mergers, consolidations, and affiliations, which may make use of parent and superparent organizations, operating corporations, and management companies. Functional options include the use of management divisions, membership powers, voting rights, nomination and election provisions, and ex officio positions. The combination of options that will best resolve conflict between consolidation and autonomy depends on specific circumstances.