Suggest the key financial drivers that most likely will cause health care organizations to merge. Provide support for your rationale.

Market share expansion and cost-savings due to economies scale, as well as the ability to distribute risk to different sites are likely to be key drivers for health care mergers. Market share expansion is an important factor for merging companies as it allows them to expand into new markets, gain more customers and earn additional revenue. The economies of scale can help companies achieve cost savings by merging. They are able to lower costs for labor, materials, etc. while maintaining high standards in quality. Last but not least, merging organizations in the healthcare sector can spread risks across several locations. This will help to protect you from potential losses when one location experiences a decrease in profit or demand.

There are many financial factors that could drive healthcare providers to seek out mergers in order to benefit from reduced overhead and increased efficiency, which will result in a stronger bottom line. This allows organizations stay competitive. These types of partnerships can pay off in the future if they are implemented correctly.