According to the consulting firm Irving Levin Associates, hospital merger and acquisition deals have experienced a significant boast in the past year and half. As seen below, the number of deals increased by 40% from 2009 to 2010, where total deal value rose from $1.7 billion to $12.6 billion for that same period. This year is set to continue the pace, having 23 deals in the first quarter alone.
This comes as no surprise to hospital leaders. From a recent survey by HealthLeaders Media (“Hospital Mergers and Acquisitions: Opportunities and Challenges,” November 2011), 86 percent of hospital leaders are expecting increased acute care M&A activity across the next 12 months. In addition, 87 percent expected the Patient Protection and Affordable Care Act, if enacted, will drive volume. That same survey showed that the top three physician specialties for M&A activity are hospitalists (70%), primary care (69%), and cardiology (66%).
How do we here in Georgia stack up to this national trend? It appears that we’re right on point. Since the start of the year, our headlines have been dotted with several large hospital acquisitions, with two of the largest being Emory’s purchase of St. Joe’s in March and Piedmont’s purchase of Henry Medical Center in April.
Now that it is rumored that Southern Regional is weighing its options, it begs the question of how soon will the next big acquisition occur and if 2011 might just make Atlanta the poster child for what is in store for the next 5 years in the industry. We’re all tuned in to find out.