The COVID crisis is affecting U.S. healthcare even at the level of high finance, suppressing merger and acquisition activity in the provider sector by almost 20% in 2020’s second quarter (327 transactions) versus its first (404 deals).
Further, M&A spending dove 91% compared with the second quarter of 2019.
And subsectors showing activity drops in the double digits included physician group practice, behavioral health, long-term care and home health & hospice.
The scorekeeping comes from HealthCareMandA.com, which publicized the findings July 24.
The website’s editor, Lisa Phillips, comments that the falloff was no surprise, given the pandemic.
“Some analysts were hoping for a rebound in deal activity in Q3 and we are seeing that in some areas,” she says. “But with the virus surging in some of the largest states, it will likely be another soft quarter for healthcare deals.”
Phillips also notes that deals involving hospitals ticked up a bit, 11% by one measure, “as some small rural hospitals closed due to the financial strains of closing down elective surgeries and dealing with critically ill COVID-19 patients.”
Dave P. has worked in journalism, marketing and public relations for more than 30 years, frequently concentrating on hospitals, healthcare technology and Catholic communications. He has also specialized in fundraising communications, ghostwriting for CEOs of local, national and global charities, nonprofits and foundations.