Hospital merger and acquisition activity in the fourth quarter of 2017 increased 40 percent from the third quarter, with 21 hospitals acquired, according to new acquisition data from Norwalk-based HealthCareMandA.com.
There were 15 publicly announced acquisitions in the third quarter of 2017.
Fourth-quarter deals were down 9 percent from the same period in 2016, when there were 23 transactions.
The largest deal during the three months was UnitedHealth Group’s $2.8 billion acquisition of the Chilean Banmedica SA, which operates hospitals, sells health insurance and provides other services. In the U.S., consolidation among large not-for-profit systems peaked in the fourth quarter with definitive merger agreements between Dignity Health and Catholic Health Initiatives, and Advocate Health and Aurora Health. For-profit chains continued to sell financially troubled facilities. Community Health Systems sold two hospitals and Tenet Healthcare and LifePoint Health each sold one, the website reported.
“The shift to value-based payments is affecting the hospital sector in myriad ways,” stated Lisa Phillips, editor of the Health Care M&A Report, which publishes the data and is part of the HealthCareMandA.com investment research source. “Continuing pressure on operating margins, shorter inpatient stays and the push by managed care organizations to deliver care in the lowest-cost setting means we’ll see even more hospital mergers on the not-for-profit side in 2018.”
