Today’s hospital administrators recognize the critical importance of aligning and integrating with physicians in the ever-evolving healthcare landscape. In the past, relationships between hospitals and physician practices were often loose and occasionally competitive. However, with the growing trend of hospital systems acquiring practices, administrators face both new opportunities and unique challenges.

The acquisition of physician practices can introduce complex management issues, such as establishing a cohesive alignment between hospital and practice goals, managing “employed” physicians who are accustomed to entrepreneurial independence, and encountering loosely defined objectives with inadequate performance measurement and tracking methods.