Healthcare M&A integration: How to overcome tech stack chaos and interoperability challenges

In healthcare M&A, success often comes down to what happens after the deal is signed. Beyond financial models and leadership alignment, the hardest part is usually the technology. Through May 2025, more than 445 health service deals totaling $64 billion have been announced. Despite the high volume of deals, only 14 percent reach successful integration, with 83 percent of practitioners citing integration hurdles as the leading cause for failure, according to a Bain & Company survey. 

When two health systems combine, they are not just blending budgets and patient charts. They are trying to connect decades of legacy infrastructure, fragmented EHRs, and siloed data that were never designed to work together. Interoperability becomes a pivotal factor in determining whether a deal creates value or collapses under technical friction.  

For healthcare leaders, this is not just an IT headache. It is an operational and patient care issue that directly impacts efficiency, compliance, and the ability to deliver coordinated care.  

Navigating competing tech stacks

The technology challenge goes far beyond picking which EHR to keep. You’re dealing with competing technology ecosystems that often include different vendors for the same functions, established vendor relationships, and significant pressure to show integration progress quickly. 71 percent of CEOs identify valuation misalignments and incompatible systems as growing barriers to deal success, making technology decisions critical to M&A outcomes. 

Kevin Day, CTO at Rhapsody has supported several healthcare leaders overcoming these hurdles. He shared, “in healthcare M&A, it’s not just about choosing one EHR over another, it’s about aligning entire technology ecosystems under extreme pressure. Every vendor contract, infrastructure decision, and interoperability gap becomes a potential roadblock. The organizations that succeed are the ones that treat technology integration as a strategic lever, not an afterthought.” 

The most common areas where organizations face competing solutions include: 

Core Clinical Technologies: Merged entities frequently run on different EHR platforms (Epic, Cerner, MEDITECH) and may use imaging systems from competing vendors like GE, Philips, or Siemens. Laboratory information systems add another layer of complexity. As these technologies were not built with interoperability in mind, integrating patient records and care workflows becomes a massive lift.  

Infrastructure and Integration: One organization may be committed to a cloud-first strategy while the other is heavily invested in on-premises systems. Integration engines, API standards, and data warehouses can all look very different, creating technical debt that slows down progress. 

Vendor Relationships and Contracts: Long-term contracts don’t line up neatly. Vendors have different pricing, support models, and upgrade timelines. And it’s not just about contracts. Staff often have strong loyalties to the systems and relationships they’ve relied on for years, making transitions politically sensitive.  

Timeline and Financial Pressures: Regulators expect to see meaningful integration progress. Investors look for quick cost savings and synergy. Meanwhile, operations can’t grind to a halt while IT teams try to stitch together two technology environments. Running parallel systems is expensive but moving too fast risks breaking critical clinical workflows.  

In healthcare M&A, the challenge isn’t about picking the ‘better’ EHR or integration engine. It’s about making strategic choices that balance compliance, cost, staff adoption, and patient care. These choices can make or break the success of a deal.  

West Virginia University Health System, which grew rapidly to 21 hospitals through M&A, faced the familiar burden of consolidating disparate IT systems and migrating off an aging engine while meeting operational timelines. By standardizing Corepoint Integration, WVUHS cut interface development time by more than 50 percent, accelerated onboarding of new facilities, and freed IT staff for higher-value projects. As Christopher Lancaster, Manager of Interoperability, explained, “Improving efficiency is something we’re always looking to do in all areas of the health system, including the IT department. Now, we have tools and solutions that make it easier, faster, and more intuitive to create or reuse interfaces and onboard new facilities.” 

How technology consolidation defines M&A success

When healthcare organizations merge, the success of the deal often comes down to what happens with technology. Choosing which systems to keep, which to retire, and how to connect them isn’t just an IT decision. These choices shape financial outcomes, regulatory compliance, staff morale, and ultimately, patient care. That’s why having a clear strategy for technology consolidation is critical. 

Define goals before choosing a tech stack 

The acquiring organization’s systems aren’t always the best fit for the new entity. Before making decisions, leaders need to define the goals of the combined organization: 

• What workflows must be preserved? 

• What capabilities need to scale? 

• What level of flexibility is required for future growth? 

By setting requirements up front, organizations can evaluate options holistically rather than defaulting to the loudest voice in the room. 

Evaluate integration approaches 

Once priorities are clear, the next step is to determine how to integrate. Most organizations choose between three broad strategies: 

• Full Consolidation: Select one solution from each category and migrate all users to it. This maximizes efficiency and reduces long-term costs but requires significant upfront investment and change management. Works best when cultures are aligned and systems are complementary. 

• Federation: Maintain separate systems while building integration layers to connect data and workflows. This approach minimizes disruption in the short term but increases operational complexity over time. It can be effective when both organizations have strong, entrenched platforms. Success also depends on having the right resources and people in place to support multiple technologies and ensure integrations are properly managed. 

• Hybrid: Combine consolidation and federation depending on the system. Some technologies are fully merged, while others remain connected through integration. This is the most pragmatic choice and often the end state for complex mergers, but it requires careful planning to avoid creating a fragmented “Frankenstein” stack.

Make strategy a choice, not a default 

The real risk in healthcare M&A isn’t picking the “wrong” integration approach—it’s letting choices happen by default. Successful organizations treat technology consolidation as a deliberate, strategic process, guided by clear goals, realistic requirements, and an honest view of the people and workflows that will carry the merger forward. 

As Drew Ivan, Chief Architect at Rhapsody, explains, “The biggest mistake we see in M&A technology integration is letting the approach choose itself. Whether it’s consolidation, federation, or hybrid, the organizations that succeed are the ones that define their strategy early and execute against it with discipline. Otherwise, you end up with a patchwork environment that drains resources and undermines the value of the deal.” Leaders must set the strategy early, commit to it, and drive execution with discipline to preserve the value of the merger. 

The role of integration platforms in healthcare system consolidation

Regardless of the consolidation strategy chosen, robust integration platforms become critical for success. Modern healthcare integration platforms offer several advantages during M&A scenarios: 

• Rapid Interface Development: Accelerated timeline for connecting disparate systems during the integration phase 

• Protocol Translation: Ability to bridge different data formats and communication protocols between legacy and modern systems 

• Scalable Architecture: Support for increased data volumes as organizations combine operations 

• Compliance Support: Built-in features for maintaining HIPAA, HITECH, and other healthcare regulatory requirements during transitions 

Modern interoperability vendors like Rhapsody offer a strategic advantage by simplifying the most complex integration and migration challenges. With flexible deployment options, user-friendly tools, and deep interoperability experience, Rhapsody leverages innovative solutions (like AI migration tools and Zero Trust Network Access) to support customers through transitions – completing migrations faster and with fewer resources. (like AI migration tools and Zero Trust Network Access) to support customers through transitions – completing migrations faster and with fewer resources.  

Investing in interoperability platforms, supported by expert teams who understand your environment and are dedicated to your success, can significantly reduce labor costs, prevent delays, and minimize headaches throughout the integration process.  

The bottom line 

Healthcare M&A technology consolidation is complex, but it doesn’t have to be chaotic. Organizations that approach it strategically, with thorough assessment, cross-functional teams, and the right technology partners, unlock real operational efficiencies, and better clinical outcomes. 

The takeaway? Technology integration isn’t just a technical project. It is a critical component of a strategic transformation that can determine the success or failure of your merger. With careful planning, active stakeholder engagement, and partners who understand healthcare’s unique challenges, organizations can navigate the complexity and capture the full value of their investment.