First Quarter 2015 Hospital Merger & Acquisition Activity Keeps Pace with 2014, According to Kaufman Hall Analysis

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Hospital merger and acquisition activity remains strong in the first quarter of 2015 as organizations continue to seek the scale, scope, and efficiencies for a value-based system, according to the latest analysis by Kaufman, Hall & Associates, LLC, a leading provider of strategic, capital, financial, and transaction advisory services and software tools.

The analysis identified 23 hospital transactions in the first quarter of 2015. Although down slightly from the 27 transactions recorded in the first quarter of 2014, the number remained in line with 2014’s quarterly average of 23.5.

More insights about first-quarter hospital M&A activity:
•The transactions showed continued variety in form and structure
•The transactions occurred across a broad range of acute-care segments, including not-for-profit, for-profit, rural, urban, and academic health centers
•Eight of the 23 transactions, or 35 percent, involved acquisitions by for-profit organizations, a somewhat higher percentage than in recent quarters
•The total operating revenue of the acquired organizations was more than $4.8 billion
•The largest deal announced was the combining of Atlanta-based Emory Healthcare and WellStar Health System

The transition to value-based healthcare challenges hospitals and health systems to enhance and optimize their delivery networks, align with physicians and other clinicians, expand their care management capabilities, develop a foundation of clinical and business intelligence, and enhance efficiency. “Achieving the new and expanded capabilities for success in a value-based system is a significant challenge for many organizations,” says Anu Singh, Managing Director at Kaufman Hall. “Mergers and acquisitions, as well as affiliations and collaborations, will continue to be important ways for organizations to advance their strategic objectives within a rapidly changing environment.”

About Kaufman Hall
Since 1985, Kaufman Hall has been a leading advisor to hospitals and health systems, helping them incorporate proven methods into their strategic planning and financial management processes and consistently achieve their goals. Management consulting services and enterprise performance management software enable data-driven analysis and quantify the financial impact of plans, scenarios, and actions to improve organizational decision making. Kaufman Hall provides sophisticated, integrated, and intuitive software solutions for long-range planning, budgeting and forecasting, performance reporting, capital planning, cost accounting, decision support and analytics on a unified platform that can be delivered via the cloud or on premise.

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Chanel Benoit
Aria Marketing for Kaufman Hall
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