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Ahla hosp merger slides (2013)

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Ahla hosp merger slides (2013)

  1. 1. Center for Healthcare Economics and Policy1
  2. 2. Center for Healthcare Economics and Policy2
  3. 3. Center for HealthcareEconomics and PolicyHospital Mergers and Acquisitions: 2007-2012April 2013
  4. 4. Center for Healthcare Economics and PolicyOverviewThe Center for Healthcare Economics and Policy (“Center”), a separate business unit in theEconomics Practice of FTI Consulting, Inc.*, was commissioned by the American Hospital Associationto conduct this study of mergers and acquisitions over the last 6 years (2007-2012). The study usesinformation from: Irving Levin Associates, Inc, including The Hospital Acquisition Report 2012 Modern Healthcare, Hospital Mergers and Acquisitions Reports, 2007-2012 American Hospital Association, Healthcare QuickDisc, 2008, 2010, 2011 Center for Healthcare Economics and Policy, proprietary research* The study was conducted by Margaret E. Guerin-Calvert, President and Senior Managing Director,Senior Consultants, Eliot Davila, Colin O’Laughlin and Consultant, Russell Keathley.4
  5. 5. Center for Healthcare Economics and PolicyNumber of Transactions and Hospitals Involved in Them Per Year2007-20125 From 2007 to 2012, there were 316 transactions involving 551 acquired hospitals The average number of acquired hospitals per transaction was between 1 and 2Note: Reported transactions exclude acquisitions by private equity firms or physician groups, verticaltransactions, abandoned transactions and other non-hospital-to-hospital transactions. It does includepending transactions.AcquiredHospitalsYearNumber ofTransactionsTotalHospitalsAverage Number ofHospitals Per TransactionTotal 316 551 1.72007 45 111 2.52008 46 52 1.12009 36 61 1.72010 49 90 1.82011 69 107 1.62012 71 130 1.8
  6. 6. Center for Healthcare Economics and PolicyFrequency of Transactions by Number of Acquired Hospitals2007-2012 The majority of transactions between 2007 and 2012 involved a single acquired hospital6
  7. 7. Center for Healthcare Economics and PolicyProportion of All Transactions where there was an Overlap in Oneor More MSAs*; 2007-20127*Note: The term ‘MSA’ denotes either a metro- or a micropolitan statistical area An MSA overlap occurs when both parties are in the same MSA The proportion of transactions that resulted in at least 1 MSA overlap fell fromapproximately 60% in 2007 and 2008 to less than 35% in 2012
  8. 8. Center for Healthcare Economics and PolicyPercentage of MSA* Overlaps Occurring in MSAs with More than 4Competitors (162 MSA Overlaps in 153 Transactions); 2007-2012 More than 91% of the overlaps were in MSAs with more than 4 competitors8*Note: The term ‘MSA’ denotes either a metro- or a micropolitan statistical area
  9. 9. Center for Healthcare Economics and PolicyPercentage of MSA* Overlaps Occurring in MSAs with More than 5Competitors (162 MSA Overlaps in 153 Transactions); 2007-2012 Almost 90% of the overlaps were in MSAs with more than 5 competitors9*Note: The term ‘MSA’ denotes either a metro- or a micropolitan statistical area
  10. 10. Center for Healthcare Economics and PolicyOverlap MSAs* with 5 or Fewer Competitors (20 MSAs):MSA Population and Count of Overlaps; 2007-2012 20 MSA overlaps occurred in MSAs with 5 or fewer competitors 16 of these 20 MSAs had populations of less than 200,00010*Note: The term ‘MSA’ denotes either a metro- or a micropolitan statistical area
  11. 11. Center for Healthcare Economics and PolicyDistribution of Acquired Hospital Size in the 20 Overlap MSAs*2007-201211*Note: The term ‘MSA’ denotes either a metro- or a micropolitan statistical area
  12. 12. Center for Healthcare Economics and PolicyDistribution of 20 MSA Overlaps by State and Year12State Year AcquiredHospital BedSizeGeorgia 2011 41Louisiana 2008 171Michigan 2007 1812008 992010 34Minnesota 2011 852012 134New Mexico 2011 12New York 2009 199North Carolina 2008 25Ohio 2010 25Oklahoma 2012 45Pennsylvania 2007 200South Carolina 2007 41Tennessee 2012 118Texas 2007 502009 120Virginia 2008 135West Virginia 2010 435Wisconsin 2011 25

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