The greatest rise in merger, acquistion, and partnership activity will occur in the West and South, HealthLeaders survey data shows.
According to the 2017 HealthLeaders Media Mergers, Acquisitions, and Partnerships Survey, healthcare leaders cite that they expect the current high levels of merger, acquisition, and partnership activity to continue for the foreseeable future.
For example, 87% of respondents say that their organization's MAP plans for the next 12–18 months involve either exploring potential deals or completing deals underway, or both.
The breakdown: 40% of respondents say that their organization will be both exploring potential deals and completing deals underway, 34% say they will be exploring potential deals, and 13% say they will be completing deals underway.
Only 13% of respondents say they have no MAP plans, which is down 12 percentage points from 25% in last year's survey. These results indicate a continued positive trend for MAP activity.
Further, 61% of respondents expect their organizations' MAP activity to increase within the next three years, and 32% expect this to remain the same. Only 6% expect MAP activity to decrease, indicating that the overall trend will likely continue for some time. These results are nearly identical to last year's survey results, which were increase (63%), remain the same (33%), and decrease (3%).
Interestingly, there are some regional differences in expectations for MAP activity. For example, a greater share of respondents who say they expect MAP activity to increase are from the West (82%) than from the South (57%), Midwest (53%), and Northeast (53%), and a greater share of respondents who say they expect this activity to remain the same are from the Midwest (47%) than from the Northeast (37%), South (35%), and West (12%).
Note that a greater share of respondents who say they expect this activity to decrease are from the Northeast (10%) and South (9%) than from the West (6%) and Midwest (0%).
One factor with the potential to slow MAP activity is uncertainty around the Trump administration's healthcare agenda. However, more than half (54%) of respondents say there are no changes to their organization's MAP plans because of the Trump administration.
On the other hand, 19% say they are putting some things on hold until they know more, and 9% are revising and updating some plans, an indication that some providers are being more cautious in their planning. No respondents (0%) say that their organization is making extensive changes to its plans.
"I don't think there's enough clarity out of the administration on the healthcare front to be able to pivot yet, and it's been such a short period of time that I'm not surprised to see people waiting to know more before reacting," says Kevin Griffin, MBA, senior vice president of financial planning and analysis at Novant Health.
Novant is a nonprofit integrated healthcare network with 2,655-licensed beds, 14 medical centers, and approximately 1,500 physicians in more than 500 locations, based in Winston-Salem, North Carolina.
Jonathan Bees is a research analyst for HealthLeaders.