When he came to work for Encompass Home Health & Hospice in 2012, Cliff Blessing had to make some adjustments. He had extensive financial experience but was new to healthcare. That meant getting used to an entirely new nomenclature, new acronyms, new payment methodologies, and new compensation models that he found to be surprisingly nuanced and complicated. He also had to learn healthcare’s highly complex regulations and compliance requirements. Lastly, he had to prepare for the organization’s mergers-and-acquisitions plan, which meant even more big changes.
However, the appeal of Encompass’s culture, which emphasizes engaging and nurturing employees, made adapting worth the effort. Part of Blessing’s job is to maintain the culture throughout a rapidly expanding national home health and hospice care network.
“Maintaining our culture, empowering employees, and encouraging them to share their opinions is a challenge the bigger we get,” Blessing says. “But one of our top priorities is focusing on employees and helping them do their best by giving them the right training, resources, and tools so they can keep doing what they love: caring for patients.”
A Strategic Differentiator
Blessing and the rest of the company’s leadership has succeeded in keeping that focus throughout Encompass’s agencies around the country. In total, the company is made up of 226 locations and 8,000 employees.
Encompass’s culture is more than just a competitive differentiator that Blessing says leads to better patient outcomes. It is an intentional objective that the company emphasizes from the outset of all M&A activities. That begins with honest and transparent communication from the Encompass integration team. Then, the team goes on to spend eight weeks at the home office of newly acquired companies. This time provides Encompass with opportunities to build strong relationships with new employees and learn about the acquired company’s practices.
The integration process continues when new employees come to the Encompass Development Center to learn more about the organization. During this time, they interact directly with CEO April Anthony, COO Tracy Kruse, and other senior leaders. Additionally, the Encompass team holds general orientation programs at each new local agency location to familiarize new staff with employee benefits and other important details. Encompass has assigned each new location a “buddy agency” that is already part of the Encompass family to help facilitate the onboarding and integration processes.
“We put a tremendous amount of effort into building productive and trusting relationships,” Blessing says. “Even larger companies we’ve acquired don’t have the same kind of intentional culture building exercises that we do. It really sets us apart from the competition and helps maintain our low turnover rate.”
Growing Through Acquisition
Another of Blessing’s responsibilities is helping to identify appropriate companies to add to the existing network. Culture plays an important role there as well. Even if a company has strong revenue growth and a positive margin profile, there can be signs that its leadership is not appropriately aligned with Encompass’s values. For example, if a large group of employees all have distinctly different compensation packages, this can indicate a pattern of short-term decision making that interferes with developing a comprehensive long-term strategy.
“Separate individual deals that are trying to please everyone indicates that the leadership can’t truly be committed to taking care of each person equally,” Blessing explains. “That’s an extraordinarily important commitment for us and an equally important factor to consider.”
Blessing and his team’s efforts to preserve and maintain the Encompass culture were put to the test in 2015 when the company undertook the largest transaction in its history: the acquisition of CareSouth’s forty-five home health locations in seven states for $170 million. The deal, which broadened Encompass’s presence throughout the Southeast, included more than twenty times the number of locations usually involved in the company’s transactions and represented a price that was more than seventeen times larger than its previous average deal.
Adding a Personal Touch
CareSouth and Encompass both use HomeCare HomeBase. It is a software solution that Encompass originally developed internally for all back-office and clinical operations. This helped ease the IT integration, but the overall logistic complexity made it impossible for CEO Anthony and COO Kruse to personally announce the deal at each of CareSouth’s locations as they would traditionally have done. Instead, numerous members of the leadership team pitched in to help cover all of the locations in less than a week. Anthony and Kruse also managed to arrange personal visits to each new site within the following year.
Blessing expects that kind of approach to continue. “Encompass is moving forward with efforts to consolidate the home health and hospice care markets,” he says. “We are a large company. But when it comes to strong personal relationships and interactions, we won’t be acting like one.”
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