Physician Medical Group M&A Activity Surges In Q1:2017, According to Data from HealthCareMandA.com

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Acquisition activity in the physician medical group market surged in the first quarter of 2017, according to data from HealthCareMandA.com

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The number of physician medical group acquisitions increased to 48 in the first quarter, a 78% jump from the 27 publicly announced acquisitions in the fourth quarter of 2016, and a 109% increase from the 23 announced deals in the year-ago first quarter.

Physician medical group M&A activity surged in the first quarter of 2017 to the largest number of quarterly transactions in many years, according to new acquisition data from HealthCareMandA.com. The number of physician medical group acquisitions increased to 48 in the first quarter, a 78% jump from the 27 publicly announced acquisitions in the fourth quarter of 2016, and a 109% increase from the 23 announced deals in the year-ago first quarter. All but one of the transactions did not disclose a purchase price. The one large acquisition was Optum’s purchase of Surgical Care Affiliates for $3.277 billion. Optum is a subsidiary of UnitedHealth Group.

The most prolific buyers were MEDNAX, Inc. with five separate acquisitions, followed by Envision Healthcare Corporation with four deals and privately-owned Dermatology Associates and Epiphany Dermatology with three acquisitions each. Two other private firms announced two acquisitions each. Envision also announced two acquisitions in the fourth quarter, but MEDNAX announced only one, so this is putting MEDNAX back in the deal flow. “MEDNAX had been one of the more aggressive buyers in the past, so after the fourth quarter slowdown we were not surprised to see a jump in acquisitions by the company,” stated Lisa Phillips, editor of the Health Care M&A Report, which publishes the data. Nine of the acquired medical groups had 20 or more physicians.

Hospital companies or health systems announced seven physician medical group acquisitions in the first quarter of 2017, while private equity firms also announced seven, not including transactions announced by physician medical groups backed by PE firms. “Physicians are quickly realizing that not affiliating with larger entities, whether health systems or large medical groups, is going to make the practice of medicine more difficult in the future,” commented Lisa Phillips.        

All quarterly results are published in The Health Care M&A Report for all 13 sectors of health care, which is part of HealthCareMandA.com. For more information, or to order the report, call 800-248-1668. Irving Levin Associates, Inc. was established in 1948 and has headquarters in Norwalk, Connecticut. The company publishes research reports and newsletters, and maintains databases on the health care and senior housing M&A markets.

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Kate Wentworth
Irving Levin Associates
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