Skip to main content
Subscribe
  • Login
  • My Account
  • Logout
  • Register For Free
  • Subscribe
  • News
    • Current News
    • Providers
    • Insurance
    • Government
    • Finance
    • Technology
    • Safety & Quality
    • Digital Health
    • Transformation
    • ESG
    • People
    • Regional News
    • Digital Edition (Web Version)
    • Patients
    • Operations
    • Care Delivery
    • Payment
    • Midwest
    • Northeast
    • South
    • West
  • Blogs
    • AI
    • Deals
    • Layoff Tracker
    • HLTH 2024
    • Sponsored Content: Vital Signs Blog
  • Opinion
    • Letters
    • From the Editor
  • Events & Awards
    • Awards
    • Conferences
    • Galas
    • Virtual Briefings
    • Webinars
    • Nominate/Eligibility
    • 100 Most Influential People
    • 50 Most Influential Clinical Executives
    • 40 Under 40
    • Best Places to Work in Healthcare
    • Healthcare Marketing Impact Awards
    • Innovators Awards
    • Diversity Leaders
    • Leading Women
    • Best in Business Awards
    • The 2030 Playbook Conference
    • Innovations in Patient Experience
    • Leading Women Conference & Awards Luncheon
    • Leadership Summit
    • Workforce Summit
    • Best Places to Work Awards Gala
    • Diversity Leaders Gala
    • - Looking Ahead to 2025
    • - Financial Growth
    • - Hospital of the Future
    • - Value Based Care
    • - Looking Ahead to 2026
  • Multimedia
    • Podcast - Beyond the Byline
    • Sponsored Podcast - Healthcare Insider
    • Sponsored Video Series - One on One
    • Sponsored Video Series - Checking In with Dan Peres
  • Data & Insights
    • Data & Insights Home
    • Hospital Financials
    • Staffing & Compensation
    • Quality & Safety
    • Mergers & Acquisitions
    • Skilled Nursing Facilities
    • Data Archive
    • Resource Guide: By the Numbers
    • Surveys
    • Data Points
  • Newsletters
  • MORE+
    • Contact Us
    • Advertise
    • Media Kit
    • Jobs
    • People on the Move
    • Reprints & Licensing
    • Sponsored Content
MENU
Breadcrumb
  1. Home
  2. Mergers & Acquisitions
June 21, 2021 02:25 PM

LifePoint eyes vertical expansion with Kindred deal

Alex Kacik
  • Tweet
  • Share
  • Share
  • Email
  • More
    Reprints Print

    LifePoint Health signed a definitive agreement to acquire Kindred Healthcare, the for-profit health systems announced Monday.

    The transaction would create a massive national health system that combines LifePoint's 87 hospitals with Kindred's vast post-acute footprint. In addition to the transaction, LifePoint plans to invest $1.5 billion in the new entity over the next three years, the organizations said in a news release.

    "Kindred's focus on healing and hope, provided through its long-term acute care hospitals, rehabilitation centers and most recently its behavioral health services – an important and growing need across the country – is highly complementary to the current LifePoint network," LifePoint CEO David Dill said in prepared remarks.

    The deal is expected to close in the fourth quarter.

    The $1.5 billion investment aims to boost workforce development, particularly nurses and frontline staff, spur capital projects and improve access by upgrading the company's technology and equipment, executives said.

    LifePoint has hospitals in 29 states as well as more than 50 affiliated post-acute providers and 35 outpatient facilities. The Brentwood, Tenn.-based private-equity backed hospital chain has around 53,000 employees.

    Kindred operates 62 long-term care hospitals, 25 inpatient rehabilitation facilities, more than 100 acute rehabilitation facilities and two behavioral health centers. The Louisville, Kent.-based company has around 24,000 employees. The health insurer Humana and two private equity companies divided and bought Kindred's long-term care and home healthcare divisions in 2018.

    The acquisition is not being financed with any funds that have been received as a result of the Coronavirus Aid, Relief and Economic Security Act and related legislation, according to the release.

    While regulators have been more critical of horizontal transactions, such as when hospitals buy other hospitals, vertical consolidation like the proposed deal between LifePoint and Kindred have typically drawn less scrutiny.

    "LifePoint and Kindred have an early opportunity to align and integrate their human capital systems, which will improve their ability to organize their organizational structure, shape future desired culture and assess and leverage talent," said Jennifer Perry, managing principal at consultancy FMG Leading. "Too many merged healthcare organizations skip this step and see their integration plans falter."

    The Federal Trade Commission updated its vertical merger guidelines last year for the first time since 1984. But healthcare antitrust experts said that the guidelines were too ambiguous to prevent anticompetitive vertical consolidation. For instance, health systems have incrementally acquired physician practices via small transactions that don't typically trigger regulatory oversight.

    Some argue that vertical integration can boost quality and lower healthcare costs through improved economies of scale. Aligning incentives across providers, insurers, suppliers and other stakeholders could better coordinate care, they contend.

    Others claim that large, integrated healthcare companies can stave off competitors, which can increase costs and lower quality.

    It has been an area of focus for the FTC and Justice Department, which are gathering more data on vertical mergers and acquisitions.

    "Vertical integration represents one of the most important changes in how healthcare services are delivered, and we need to pay attention to the implications," Gary Young, director of the Center for Health Policy and Healthcare Research at Northeastern University, told Modern Healthcare in May.

    Both LifePoint and Kindred are privately held companies that do not disclose their financial statements.

    Letter
    to the
    Editor

    Send us a letter

    Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.

    Recommended for You
    handshake deal
    GHR Healthcare acquires Barton Healthcare Staffing
    Northwell-Health-and-Nuvance
    Northwell Health acquires Nuvance Health
    Most Popular
    1
    Here are new state healthcare laws taking effect in 2025
    2
    Meet Modern Healthcare's 2025 Leading Women
    3
    New York-Presbyterian layoffs affect 2% of employees
    4
    Evernorth, Optum, CenterWell units buoyed insurers in Q1
    5
    Epic CEO Judy Faulkner on AI, antitrust and consolidation
    Sponsored Content
    Modern Healthcare Alert: Sign up for this breaking news email to be kept in the loop as urgent healthcare business news unfolds.
    Get Newsletters

    Sign up for enewsletters and alerts to receive breaking news and in-depth coverage of healthcare events and trends, as they happen, right to your inbox.

    Subscribe Today
    MH Magazine Cover

    MH magazine offers content that sheds light on healthcare leaders’ complex choices and touch points—from strategy, governance, leadership development and finance to operations, clinical care, and marketing.

    Subscribe
    Connect with Us
    • LinkedIn
    • Twitter
    • Facebook
    • RSS

    Our Mission

    Modern Healthcare empowers industry leaders to succeed by providing unbiased reporting of the news, insights, analysis and data.

    Contact Us

    (877) 812-1581

    Email us

     

    Resources
    • Contact Us
    • Help Center
    • Advertise with Us
    • Ad Choices
    • Sitemap
    Editorial Dept
    • Submission Guidelines
    • Code of Ethics
    • Awards
    • About Us
    Legal
    • Terms and Conditions
    • Privacy Policy
    • Privacy Request
    Modern Healthcare
    Copyright © 1996-2025. Crain Communications, Inc. All Rights Reserved.
    • News
      • Current News
      • Providers
      • Insurance
      • Government
      • Finance
      • Technology
      • Safety & Quality
      • Digital Health
      • Transformation
        • Patients
        • Operations
        • Care Delivery
        • Payment
      • ESG
      • People
      • Regional News
        • Midwest
        • Northeast
        • South
        • West
      • Digital Edition (Web Version)
    • Blogs
      • AI
      • Deals
      • Layoff Tracker
      • HLTH 2024
      • Sponsored Content: Vital Signs Blog
    • Opinion
      • Letters
      • From the Editor
    • Events & Awards
      • Awards
        • Nominate/Eligibility
        • 100 Most Influential People
        • 50 Most Influential Clinical Executives
        • 40 Under 40
        • Best Places to Work in Healthcare
        • Healthcare Marketing Impact Awards
        • Innovators Awards
        • Diversity Leaders
        • Leading Women
        • Best in Business Awards
      • Conferences
        • The 2030 Playbook Conference
        • Innovations in Patient Experience
        • Leading Women Conference & Awards Luncheon
        • Leadership Summit
        • Workforce Summit
      • Galas
        • Best Places to Work Awards Gala
        • Diversity Leaders Gala
      • Virtual Briefings
        • - Looking Ahead to 2025
        • - Financial Growth
        • - Hospital of the Future
        • - Value Based Care
        • - Looking Ahead to 2026
      • Webinars
    • Multimedia
      • Podcast - Beyond the Byline
      • Sponsored Podcast - Healthcare Insider
      • Sponsored Video Series - One on One
      • Sponsored Video Series - Checking In with Dan Peres
    • Data & Insights
      • Data & Insights Home
      • Hospital Financials
      • Staffing & Compensation
      • Quality & Safety
      • Mergers & Acquisitions
      • Skilled Nursing Facilities
      • Data Archive
      • Resource Guide: By the Numbers
      • Surveys
      • Data Points
    • Newsletters
    • MORE+
      • Contact Us
      • Advertise
      • Media Kit
      • Jobs
      • People on the Move
      • Reprints & Licensing
      • Sponsored Content