Beyond Legal Formalities: Optimizing Due Diligence in Healthcare M&A

Healthcare M&A due diligence should not just be a legal formality, but instead an integral pre-integration planning step.

In healthcare mergers and acquisitions, legal, financial, and regulatory due diligence is often viewed as the domain of lawyers and external advisors. But that mindset is one of the key reasons deals underperform—or fail entirely.

According to a recent Deloitte study, over 40% of dealmakers cited flawed due diligence as a top contributor to failed or underperforming transactions.

At Chandler Healthcare Advisors, we know that successful healthcare M&A requires far more than legal box-checking. It demands deep engagement across clinical, operational, and cultural domains—starting well before the ink dries.

Why Internal Leaders Must Be Involved in Due Diligence

Legal and financial experts are essential, but they aren’t enough. Your internal operators have unique insights into the areas that are hardest to fix post-close:

• IT infrastructure

• HR and culture

• Facilities condition

• Benefits, retirement plans, and compliance

• Clinical workflows and operational synergies

Incorporating these subject matter experts early avoids surprises, builds alignment, and lays the groundwork for smoother integration.

💡 3 Essentials for a Stronger Due Diligence Process

1. Deeply Engage Internal and External SMEs

Don’t rely solely on outside advisors. Involve:

• IT Security teams to assess cybersecurity and data protection infrastructure

• Facilities teams to conduct site walkthroughs

• Benefits experts to analyze plan comparisons and transition risks

  
  

This comprehensive approach ensures your healthcare due diligence is grounded in real operational insight.

2. Bring in HR Leadership Early

Your HR leaders should assess:

• Cultural alignment and potential friction

• Key influencers and top talent

• Existing employment arrangements and executive contracts

• Differences in benefits and retirement plans that could impact retention or compliance

This input helps anticipate and address human capital risks—a leading cause of post-close dissatisfaction and turnover in healthcare M&A deals.

3. Assign a Due Diligence Quarterback

Having a dedicated leader or external partner to coordinate the due diligence process ensures alignment across:

• Legal and financial teams

• Internal operators and SMEs

• Investors and senior leadership

This quarterback helps manage the due diligence request list, track completion, coordinate cross-functional reviews, and keep the transaction moving—while internal leaders focus on operations and relationship-building.

At Chandler Healthcare Advisors, we serve in this role to help clients de-risk transactions and accelerate healthcare M&A integration success.

📈 Ready for a Smarter Approach to Healthcare Due Diligence?

If you're preparing for a transaction, acquiring a hospital or physician group, or leading an integration, let’s talk.

We help clients bridge the gap between legal diligence and operational readiness—making sure no stone is left unturned and no team is left out.

📫 Contact us to learn more about our due diligence support services.