For investor-owned healthcare providers, the story of 2013 is expected to be similar to the narrative of 2012: consolidation, consolidation, consolidation.
For-profit hospital systems are expected to continue, and even accelerate, their acquisition spree in the new year, as they seek to gain even more strength and scale.
The debt and equity markets will remain open to these chains, which will also be able to dip into the healthy amounts of cash sitting on their balance sheets, says John Stein, who leads the for-profit healthcare business in the Nashville office of Bank of America Merrill Lynch. “I think we'll see for-profit entities acquiring not-for-profit entities, and for-profit entities acquiring for-profit entities,” Stein says. “There's so much momentum around consolidation—I just don't see that slowing down.”