Mergers, acquisitions and consolidation are a pivotal part of healthcare operations, particularly at ASCs.
It can be helpful for independent practices to be aware of trends to compete with ASCs backed by private equity firms and large health systems and to stay up to date with where investors are interested.
Here are emerging trends in healthcare merger and acquisition activity, as laid out in an article by Ankura, a global expert services and advisory firm, and published Oct. 18 in JDSupra:
1. Expanding outpatient networks. Reduced cost of care, patient convenience, technology advancement and the pandemic accelerated health system interest in expanding outpatient care offerings. ASCs are experiencing an increase in demand and thus are increasingly attractive to investors.
Big names such as Nashville-based HCA Healthcare and Dallas-based United Surgical Partners International have used acquisitions to expand their outpatient care networks and are producing a growing share of overall company revenue.
2. Rise in private equity and investor interest. Nontraditional investors such as retail giants, technology companies and private equity firms are expanding their investments into healthcare services.
Several physician specialties, including dermatology, orthopedics, gastroenterology, dentistry and ophthalmology, are key targets for private equity.
3. Expansion of care offerings. Many healthcare groups have placed an emphasis on vertical integration — or having a role in various aspects of the care continuum. By acquiring groups along the care continuum, organizations can achieve greater coordination, improved patient outcomes and cost efficiencies.
4. Increased use of digital health technology. Healthcare companies have been acquiring digital health startups and technology companies to accelerate innovation, increase operational efficiency and expand service offerings.
5. Health system consolidation. Healthcare company mergers continue to play a key role in the industry, such as rural hospitals partnering with larger health systems to continue operations.
Despite this, healthcare remains highly fragmented and has the potential to further consolidate, according to the article.