Hospitals are merging or being bought and sold at an increasing rate, with physician practice acquisitions on the rise, according to a report issued March 8 by Moody's Investors Service and reported in American Medical News.
Data released Feb. 28 by Irving Levin Associates indicated that 86 hospital merger or acquisition deals occurred in 2011, the highest number in the past decade. Moody's said the trends are driven by decreases in reimbursement, leading hospitals to seek economies of scale. Hospitals are still looking for added leverage in contract negotiations to offset tight credit due to the recession.
Highmark, a health insurance company based in Pittsburgh, purchased West Penn Allegheny Health System in June 2011 and says it plans to purchase more hospitals and practices in the area. Health Management Associates in Naples, Fla., recently signed an agreement to own an 80 percent controlling interest in five Oklahoma hospitals owned by Integris Health.
Experts predict the trend of purchasing medical practices and employing physicians will continue as hospitals look to bolster their market share.
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Data released Feb. 28 by Irving Levin Associates indicated that 86 hospital merger or acquisition deals occurred in 2011, the highest number in the past decade. Moody's said the trends are driven by decreases in reimbursement, leading hospitals to seek economies of scale. Hospitals are still looking for added leverage in contract negotiations to offset tight credit due to the recession.
Highmark, a health insurance company based in Pittsburgh, purchased West Penn Allegheny Health System in June 2011 and says it plans to purchase more hospitals and practices in the area. Health Management Associates in Naples, Fla., recently signed an agreement to own an 80 percent controlling interest in five Oklahoma hospitals owned by Integris Health.
Experts predict the trend of purchasing medical practices and employing physicians will continue as hospitals look to bolster their market share.
Related Articles on Transactions & Valuation:
First Surgical Partners Reports Procedure Growth Challenges With Reimbursement in 2011
New CA Surgery Center in Elk Grove for Sutter Health to Open This Summer
New MN Medical Center in Worthington for Avera to Include Surgery Center