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Health system mergers in the U.S. at record high

Christopher Snowbeck, Star Tribune (Minneapolis) on

Published in Health & Fitness

"The goal is not efficiency, it's the power that comes with size -- the power to tell your workers and suppliers how much you'll pay them and to tell your customers what they will pay you," Sullivan said in an e-mail.

Sullivan noted that mergers among health insurers have been going on for a long time too, and are no less troubling. They started in the 1980s, he said, with HMOs getting bigger in order to extract discounts on services from hospitals.

"Hospitals learned quickly that to prevent their own demise, they needed to develop power commensurate with the power of the burgeoning insurance companies," Sullivan said by e-mail. "As the hospitals merged into big chains, the insurance companies responded with more mergers among themselves, and so on."

More Health System Deals

A consulting firm says 2017 set a record for merger and acquisition activity among hospitals and health systems across the country.

Year Number of Transactions Collective Revenue of Sellers/Merger Targets

2013 98 $31.3 billion

2014 102 $23 billion

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2015 112 $32 billion

2016 102 $31.3 billion

2017 115 $63.2 billion

Source: Kaufman Hall

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