Stat of the Week: ‘Other Services’ Drops 19% in Q3:17

Stat of the Week: ‘Other Services’ Drops 19% in Q3:17

by | Dec 1, 2017 8:40 pm | Other Services

Investors have flocked to the “Other Services” sector this year, as its ancillary nature keeps the companies that comprise it largely outside the purview of reimbursement regulations and other stroke-of-the-pen sectors. The 42 transactions announced in this sector in the third quarter represent a 19% decrease from the previous quarter, and a 32% decrease compared with the year-earlier quarter.  Deal volume accounted for 22% of the 192 deals announced in the past 12 months. The “Other Services” category covers products and services related to human health care, but in an ancillary way, such as contract research organizations, ambulatory surgery centers, institutional and... Read More »

MCOs Make Deals to Combat High Drug Costs

by | Jun 15, 2017 4:06 pm | Managed Care, Pharmaceuticals

The rising cost of prescription drugs was part of many candidates’ campaign platforms in the 2016 national elections. The topic has not gone away, and is certainly a factor in the dearth of Big Pharma deals in 2017.  Through June 15, M&A in the Pharma sector is down 43%, to 44 transactions, compared with the same period in 2016, which had 77 transactions. Spending is also down in for the first six months of 2017. Through June 15, acquirers announced $19.2 billion in committed financing, down 66% from the same period in 2016, when approximately $56.5 billion was spent. There are deals being done, regarding this issue, but most are not M&A. In fact, several managed care... Read More »

More Big Deals for Doc Groups

by | May 26, 2017 5:32 pm | Physician Medical Groups, Private Equity

The Physician Medical Group sector started off the year strong and hasn’t lost any momentum as physician groups continue seeking scale to survive. As of May 26, 2017, 77 deals have been announced. The largest disclosed deal was Optum’s (NYSE: UNH) $3.3 billion acquisition of Surgical Care Affiliates, Inc. (NASDAQ: SCAI) in January. In May, the second largest deal of the year was announced. The acquirer, Surgery Partners (NASDAQ: SGRY), operates surgical facilities in the United States. Its target is National Surgical Healthcare,  a portfolio company of Irving Place Capital, for $760 million. National Surgical Healthcare owns and operates 21 surgical facilities in partnership with local... Read More »

The MACRA Effect Keeps Building

by | Mar 23, 2017 2:55 pm | Managed Care, Physician Medical Groups, Private Equity

Last year, the Centers for Medicare and Medicaid Services asked for comments and then rolled out the final rules on the implementation of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). Many industry observers predicted the rules would drive the majority of independent physician practices “right into the arms” of a local hospital, health system or other entity. Those predictions appear to be true. As of mid-March 2017, 46 acquisitions of physician practices have been announced, a 105% increase from the same period a year ago. Only one of the deals disclosed a price,  Optum’s (NYSE: UNH) $3.3 billion acquisition of Surgical Care Affiliates Inc. (NASDAQ:... Read More »

What’s Next for Managed Care?

by | Feb 24, 2017 8:38 pm | Managed Care, Physician Medical Groups, Private Equity

The managed care mega-deals of 2015 have blown up. Aetna (NYSE: AET) and Humana (NYSE: HUM) amicably terminated their $37 billion merger, following a federal judge’s order in January to block the deal on antitrust grounds. The $1 billion termination fee was in the works. A different federal judge blocked Anthem (NYSE: ANTM) and Cigna’s (NYSE: CI) $54.2 billion merger on similar grounds. Things turned ugly quickly, as Cigna declared the deal dead and sued Anthem for the $1.85 billion termination fee, and another $13 billion in damages on behalf of its shareholders. Anthem says it will go ahead with the merger. What do the Big Five health insurers do now that they’re... Read More »