Analysis: Mass. providers leading hospital M&A surge

Steward is closing Nashoba Valley Medical Center in Ayer.

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By Emily Micucci

More mergers and acquisitions among hospitals are happening this year than last, according to a new analysis that cites two Massachusetts-based providers as announcing some of the biggest transactions in 2017 so far.

Partnership transactions among hospitals increased 15 percent, year over year, in the second quarter of 2017, according to an analysis by financial advisory firm Kaufman, Hall & Associates LLC released Wednesday.

So far in 2017, there have been 58 transactions, including mergers and acquisitions, among U.S. hospitals. That’s compared to 52 this time last year. Thirty-one of those transactions occurred in the second quarter, compared to 27 a year earlier.

In addition, it appears that transactions among large organization with $1 billion or more in revenue are on the rise. Six such transactions happened in the first quarter of 2017, compared to four in all of 2016.

Two those deals involved Massachusetts-based systems. Boston-based Steward Health Care and Tennessee-based IASIS Healthcare announced a deal that would make Steward the country's largest private for-profit hospital operator with 36 hospitals in 10 states. Also announced was the acquisition of Providence, Rhode Island-based Care New England Health System by Boston-based Partners HealthCare.

Patrick Allen, managing director at Kaufman Hall, said in a statement the uptick will likely continue.

"Traditional providers face an array of uncertainties, from changing federal healthcare policies to shifting payment and care delivery models. Health systems across the country are looking to grow and transform their operations to ensure stability in the face of turbulent times,” Allen said.