Healthcare mergers and acquisitions are in no short supply as providers, health tech companies, payers and other industry players look to expand their businesses and gain a competitive edge. Here’s a roundup of new deals that were revealed, closed, rumored or called off during the month of June.
Amedisys, a large home health, hospice and palliative care provider, agreed to be acquired by UnitedHealth's Optum in a $3.7 billion all-cash deal that scraps a previous all-stock option from Option Care Health. Amedisys had previously agreed to the Option Care acquisition in May before receiving the unsolicited offer from Optum. As a result, Option Care will receive a $106 million termination fee. Should the new deal close, Optum would add about 18,000 home health employees and 522 care centers to its growing collection of home health offerings.
UPMC signed a nonbinding letter of intent to affiliate Washington Health System, a two-hospital nonprofit community health system based in Pennsylvania. Washington Health System had been on the hunt for a larger health system to partner with and reportedly turned down an offer from Highmark Health’s Allegheny Health Network. UPMC and Washington will be hashing out the terms on a definitive affiliation agreement “over the next several months” in a deal that would be subject to customary regulatory filings. Other potential terms were not disclosed.
Vandalia Health (the recent combination of Mon Health System and Charleston Area Medical Center Health System) signed a nonbinding letter of intent to acquire Davis Health System, which includes an acute care hospital, two critical access hospitals and other specialty care facilities serving West Virginia’s Potomac Highlands region. Terms and an estimated timeline to close were not shared in the announcement.
Beth Israel Lahey’s acquisition of Exeter Health received an all-clear from the New Hampshire attorney general’s office, paving the way for the deal to go live July 1. The merger was announced in June 2022 and adds the 2,500-person, single-hospital Exeter to the 13-hospital Beth Israel Lahey.
Parkview Health System (PDF) wrote in an event filing that it plans to acquire Community Hospitals and Wellness Centers, an Ohio-based nonprofit system with two hospitals and a medical center hosting several outpatient clinics and same-day surgical services. Parkview said it expects to close the acquisition Sept. 1.
Boston Children’s Hospital and pediatric post-acute care provider Franciscan Children’s announced in late June a definitive affiliation agreement that closed July 1. The deal sees Franciscan Children’s retain its branding as a “sister hospital” to Boston Children’s, though it will now be under the umbrella of Boston Children’s parent organization, Children’s Medical Center Corp. The affiliation allows Boston Children’s to begin offering more integrated care offerings related to behavioral health and rehabilitation and paves the way for hundreds of millions of investments into Franciscan Children’s facilities and staff.
Novant Health’s plan to purchase and invest $50 million into the struggling Pender Medical Center in North Carolina was approved unanimously by the Pender County Board of Commissioners. Novant had been operating the facility since 2021 under another agreement but now will work to develop Pender Medical Center into a community general hospital over the next 10 years. Legal documents will be finalized in September, and the deal will be closed in six months, the board said.
The Guthrie Clinic is purchasing ownership of Our Lady of Lourdes Memorial Hospital and its related locations and practices from Ascension. The deal is expected to close by early 2024.
Christus Health announced it would acquire New Mexico-based Gerald Champion Regional Medical Center, a sole community hospital in New Mexico. The deal went into effect July 1.
University of Missouri Health Care has signed a nonbinding letter of intent to fully integrate with Capital Region Medical Center. The pair had been partners for more than 25 years and said they expect to finalize their arrangement by the end of the year.
Adventist Health reportedly acquired the struggling Bakersfield Heart Hospital in California for “a nominal sum.” The hospital had been independently owned by local physicians that, due to pandemic financial struggles, had laid off 114 employees last fall. Adventist leadership reportedly said its purchase will save 300 jobs at the facility.
Atlus Community Healthcare—a portfolio company of ZT Corporate, a private equity firm—acquired Exceptional Emergency Center. The purchase of Exceptional and its 14 free-standing emergency rooms now brings Atlus to 30 such facilities in Texas.
Inova Health System has picked up Northern Virginia Pulmonary and Critical Care Associates, a nine-physician group, for an undisclosed sum. With the deal, Inova created a new pulmonary division and added two practice locations to its tally.
Bright Health is selling off its California plans, the last of its insurance businesses, to Molina Healthcare for up to $600 million in cash. The insurtech had been selling off its pieces in a push to raise capital and stave off bankruptcy. For the deal to go through, however, Bright must remain solvent through the first quarter of 2024, which will likely require a bridge loan. Bright Health has roughly 125,000 members covered through Medicare Advantage prescription drug plans, dual eligible special needs plans and chronic conditions special needs plans across 23 California counties.
Centene closed its previously announced divestiture of artificial intelligence platform Apixio to venture capital firm New Mountain Capital. Financial terms of the deal were not disclosed, though Centene said it expects the deal to be earnings neutral for 2023. The government insurance giant had acquired Apixio in 2020 but has been reconsidering its portfolio as part of a broader value creation plan.
CareSource, a nonprofit health plan with over 2.3 million members, said it has an agreement in place to acquire Metta Healthcare and United Church Homes. The latter organizations will form a new nonprofit entity named Radiant Alliance, which will become an affiliate of CareSource and serve as its innovation platform piloting supportive care and housing capabilities for aging members with complex medical needs. Terms of the deal were not disclosed.
Thirty Madison scooped up the assets of recently bankrupted online birth control and telehealth company The Pill Club in a deal valued at $32.3 million. Thirty Madison, a virtual-first health clinic offering telehealth visits and online prescriptions, said the deal strengthens its position in women’s health.
Cardinal Health announced a deal that merges its Outcomes business, which includes an ecosystem of patient engagement, clinical care, workflow and financial tools for clinical pharmacies, with Transaction Data Systems, which has its own portfolio of clinical pharmacy solutions, in exchange for a minority stake in the combined entity. The deal is expected to close in the third quarter of 2023 and would create an integrated pharmacy workflow software offering.
Premier Inc. signed a definitive agreement to offload its non-healthcare group purchasing operations to OMNIA Partners for about $800 million cash. The deal aims to satisfy stockholders after sequential tough quarters and allows Premier to focus its attention on growth in its core healthcare business. The deal is expected to close in early August subject to regulatory approval and other conditions.