Hospital merger and acquisition activity spikes by 15% in second quarter, Kaufman Hall report says

Hospital merger and acquisition activity saw a notable uptick in the second quarter of 2017, according to advisory firm Kaufman Hall, with activity swelling by 15 percent to 31 transactions from 27 this time last year.

So far this year, 58 transactions have been announced, compared to 52 in second quarter 2016.

Large-scale transactions with organizations with nearly one billion or more in revenues rode the wave, with six in the first half of the year already. In 2016, only four of these were announced all year long.

Nonprofit organizations are leading the M&A activity, with 22 of the 31 deals involving a nonprofit acquirer. For-profit acquirers were involved in eight of the deals, and one transaction involved a for-profit/not-for-profit combination.

[Also: Tracking 2017 mergers and acquisitions]

Pennsylvania and Texas hosted the most merger activity, with four announced transactions each in the second quarter. In Massachusetts, five hospitals have revealed plans to merge into a regional system. Those hospitals are Anna Jaques Hospital, Beth Israel Deaconess Medical Center, Lahey Health, New England Baptist Hospital, and Mount Auburn Hospital.

"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," Kaufman Hall Managing Director Patrick Allen said.

Twitter: @BethJSanborn