In a move that will reshape the healthcare landscape in Missouri, St. Louis’ largest health system, BJC HealthCare, and Kansas City’s second-largest, Saint Luke’s Health System, will join forces. This merger, which brings together 28 hospitals across the state, is just one of the latest in the ongoing consolidation of the hospital industry.
How many healthcare mergers and acquisitions occurred in 2023?
In 2023 so far, Definitive Healthcare tracked more than 200 articles on mergers and acquisitions (M&As), reflecting the strategic realignment and consolidation within the healthcare sector. Collectively, the top 10 health systems now manage over 1,400 hospitals, or 18% of all hospitals managed by health systems. The top health systems also manage more than 186 million hospital beds, or 18% of all health system beds, and account for about one in five discharges. Below are the top 10 health systems by number of staffed hospital beds.
Top 10 health systems by number of staffed hospital beds
Rank | Health system name | State | # of staffed beds | # of discharges | # of hospitals |
1 | HCA Healthcare | TN | 41,586 | 1,928,025 | 215 |
2 | Department of Veterans Affairs | DC | 25,260 | N/A | 161 |
3 | Universal Health Services | PA | 21,055 | $696,218 | 181 |
4 | CommonSpirit Health | IL | 19,495 | 802,162 | 158 |
5 | Ascension Health | MO | 17,701 | 701,372 | 129 |
6 | Trinity Health | MI | 15,014 | 676,270 | 110 |
7 | Tenet Healthcare | TX | 13,976 | 507,497 | 85 |
8 | Advocate Health | NC | 11,789 | 509,716 | 70 |
9 | Providence St. Joseph Health | WA | 10,435 | 415,055 | 57 |
10 | Community Health | TN | 10,035 | 396,321 | 81 |
Fig. 1 - Data is from the Definitive Healthcare HospitalView product, according to the most recent 12-month interval tracked in our database. Data is sourced from the October 2023 Medicare Cost Report release. Accessed December 2023.
What were the biggest healthcare mergers and acquisitions in 2023?
Health systems may opt to merge for various strategic, financial, and operational reasons. Notable health system mergers and merger announcements this year include the following:
- CommonSpirit completed its acquisition of five hospitals in Utah and more than 25 medical group clinics, including a clinically integrated network, from Steward Health Care.
- Kaiser Permanente agreed to acquire Geisinger Health in a deal that will make the Pennsylvania-based health system the first to join Risant Health, a new nonprofit organization.
- St. Louis-based BJC HealthCare and St. Luke’s Health System, based in Kansas City, finalized plans to merge in a deal that will form a 28-hospital, $10 billion academic health system in Missouri.
- Two Wisconsin health systems, Froedtert Health and ThedaCare, have signed a letter of intent to combine into a single, 18-hospital system.
- The University of Michigan Health acquired Sparrow Health System to become a $7 billion health system with more than 200 care sites across Michigan.
We also saw at least one big deal fall apart this year: New Mexico-based Presbyterian Healthcare Services and Iowa-based UnityPoint Health called off a cross-market merger that would have resulted in an $11 billion entity with almost 50 hospitals.
Beyond hospitals, health systems are also snapping up ambulatory surgery centers (ASCs), urgent care clinics, and other sites of care as more care continues to shift from inpatient to outpatient settings. Below, we highlight the top 10 health systems by number of affiliations.
Top 10 health systems by number of affiliations
Fig 2- Data is from the Definitive Healthcare HospitalView product. Accessed December 2023.
HCA has the most hospitals in the U.S., with 215 hospitals. Among the top 10 health systems based on affiliations, HCA also has the largest number of physician groups and urgent care clinics. The health system will add even more urgent care clinics to its network with its pending acquisition of 41 Texas urgent care clinics from FastMed.
Meanwhile, CommonSpirit Health leads the way with the total number of skilled nursing facilities (SNFs) and home health agencies. Ascension Health operates by far the most hospices, while Tenet Healthcare dominates the ASC space with 360 ASCs – the most of any health system by a long shot.
As more care steadily shifts to outpatient settings like ASCs and urgent care centers, look for health systems to ramp up investments and form joint ventures with additional outpatient partners.
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