Health care mergers and acquisitions hit lowest level in years

Only 12 transactions were announced in Q1, the lowest recorded since tracking began in 2016

The number of health care-related mergers and acquisitions was at an all-time low in the first quarter of this year, according to Kaufman Hall’s Quarterly Mergers and Acquisitions Report.

Only 12 health care transactions were announced in the first quarter, the fewest in a first quarter since Kaufman Hall began tracking transactions in 2016. The lack of transactions is consistent with the low level of activity its experts have observed throughout the pandemic. There were 13 transactions in the first quarter of 2021, and 29 in 2020.

The deals that did get done were defined by smaller dollar figures, according to the report. There also were no “mega transactions” defined as one of the parties having revenue in excess of $1 billion annually, and four of the 12 transactions included parties whose average revenue was under $100 million.

Seven of the 12 transactions had for-profit sellers and only one transaction had a for-profit buyer.

National health plans continue to dive into the care delivery space—particularly home health care. UnitedHealthcare Group announced its plan to acquire home-based health operator LHC Group.

Kaufman Hall experts see this quarter’s low deal rate as an anomaly and expect health systems to ramp up their transaction rates for the rest of the year.