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<\/a><\/figure>\n\n\n\nHowever, the size of the transactions in Q2 2022 differed significantly from the last quarter.<\/p>\n\n\n\n
Whereas Q1 2022 didn\u2019t see any mega transactions, two of the 13 deals in Q2 2022 were considered mega transactions\u2014transactions in which the seller or smaller party has an annual revenue of more than $1 billion.<\/p>\n\n\n\n
These deals included the merger between Advocate Aurora Health and Atrium Health, where the smaller party had a revenue of $12.9 billion, and the acquisition of MercyOne by Trinity Health, where the smaller party had a revenue of $3.0 billion.<\/p>\n\n\n\n
Additionally, two other transactions included a smaller party with an annual revenue of over $500 million. The proposed merger between Bellin Health System and Gunderson Health System had a smaller party revenue of $800 million and the deal between George Washington University Hospital and Universal Health Services had a smaller party revenue of $600 million.<\/p>\n\n\n\n
During Q2 2022, the average size of the smaller party was nearly $1.5 billion, which was more than double the record-setting average size of $619 million at the end of 2021.<\/p>\n\n\n\n
The substantial transaction sizes in Q2 2022 contributed to the high overall revenue of $19.2 billion.<\/p>\n\n\n\n
In contrast, the total transacted revenue in Q1 2022 was just $2.95 million, with the average size of the smaller party at $246 million.<\/p>\n\n\n\n
Q2 2022 total revenue was also significantly higher than the past couple of years, with total revenue at $12 billion in Q2 2020 and $8.8 billion in Q2 2021.<\/p>\n\n\n\n
The acquiring party in three of the 13 announced transactions in Q2 2022 was a for-profit health system, the report noted. One deal had an academic\/university-affiliated acquirer, another had a religiously affiliated acquirer, and the remaining eight deals had nonprofit health systems as the acquiring entity.<\/p>\n\n\n\n
The returning trend of fewer but larger healthcare transactions may signal a long-term shift in merger and acquisition activity, Kaufman Hall researchers said.<\/p>\n\n\n\n
The report highlighted the importance of merger and acquisition deals involving skilled nursing facilities (SNFs) and long-term care facilities.<\/p>\n\n\n\n
\u201cA high-performing skilled nursing facility is a critical ally for health systems, particularly those that are focused on performance in value-based care arrangements or looking to enable earlier discharge from inpatient care to the lower-cost SNF setting and help to reduce hospital readmissions,\u201d the report stated.<\/p>\n\n\n\n
COVID-19 infections, shifting consumer preferences, and staffing shortages have created a challenging environment for SNFs during the pandemic, prompting health systems to sell SNF assets, partner with SNF providers, or invest in next-generation SNFs.<\/p>\n\n\n\n
For example, Hackensack Meridian Health announced in March 2022 that Complete Care would acquire the majority of its long-term care facilities. Virtua Health also announced in April that it planned to sell two of its SNFs to Tryko Partners, which will continue to operate the facilities.<\/p>\n\n\n\nSource: Revcycle Intelligence<\/a><\/span>\n\n\n\n <\/p>\n\n\n\n <\/p>\n","protected":false},"excerpt":{"rendered":"