A Run-Down of M&A Activity in the Healthcare Industry in Early 2023

Merger and acquisition activity flourished in the healthcare industry in early 2023, with providers, payers, and tech companies closing significant deals. Here’s a run-down.

CVS Health announced a definitive agreement to acquire Oak Street Health in an all-cash deal valued at $10.6 billion. Oak Street is a Medicare-focused primary care provider that is tech-enabled, multi-payer and value-based. It has 169 medical centers in 21 states and is expected to reach 300 by 2026.

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Also, UnitedHealth Group has closed on its $5.4 billion acquisition of LHC Group, following a lengthy FTC probe.

In tech, Amazon’s $3.9 billion deal to buy One Medical has closed, strengthening its healthcare presence.

In a $685 million deal, CommonSpirit Health announced the purchase of five Steward Health Care hospitals, 35 group clinics, and a network of providers in Utah. The transaction was made via the Catholic system’s Centura Health joint venture.

In North Carolina, Community Health Systems said it signed a deal to sell two hospitals to Novant Health for $320 million, increasing Novant’s number of facilities to 15.

Also, the 335-bed Flagler Health+ and the University of Florida’s UF Health have entered into an exclusive nonbinder letter of intent to merge later in 2023.

In the behavioral health market, Lifepoint Health has acquired a majority ownership interest in the operating company of provider Springstone. Under the deal, 18 behavioral health hospitals and 35 outpatient facilities will be added in nine states.

Also, six-hospital, 622-bed system Logan Health has signed a letter of intent to merge with Billings Clinic, a multi-specialty group practice with a 336-bed hospital and trauma center serving Montana, Wyoming and the western Dakotas.

And, according to Bloomberg, ProMedica has agreed to sell its hospice and homecare assets to Gentiva for $710 million, increasing Gentiva’s locations from 380 to 500 and patient base from 25,000 to 34,000.