After a relative slowdown that’s lingered since the pandemic, healthcare merger and acquisition activity is poised for a “vigorous season” in 2024, underscoring the need for healthcare organizations to gear up strategically, according to advisors from Grant Thornton.
"The key to good diligence planning is having an agile playbook," said Glenn Barenbaum, a Partner in Transaction Advisory for Healthcare Diligence at Grant Thornton, emphasizing the need for leaders to focus on critical aspects that influence the “go/no-go” decision.
Adrianne Boylen, a Healthcare Advisory Partner, stressed the need for founder-owned physician practices to optimize their operations to gain a competitive edge, especially given the lack of tech investment she’s seen in the marketplace.
"It's about being forward-thinking about revenue cycles for growth,” said Boylen, though the speakers noted that it’s challenging to confidently maintain a reliable and responsive revenue cycle amidst the ever-changing healthcare reimbursement landscape.
There were 65 announced M&A transactions in 2023, up from 53 in 2022, according to a separate report from Kaufman Hall. Financial distress was cited as a factor in more than a quarter of announced transactions, compared with 15% in 2022.
"If you're a founder-owned physician practice, they might not need the state of the art,” said Barenbaum. “But if they're seeking to grow, investments are needed.”
Grant Thornton is an international umbrella network of independent accounting and consulting firms that works with both the private and public sectors. Their full video series on the 2024 M&A forecast can be viewed here.
Evan joined TriMed in 2011, writing primarily for Health Imaging. Prior to diving into medical journalism, Evan worked for the Nine Network of Public Media in St. Louis. He also has worked in public relations and education. Evan studied journalism at the University of Missouri, with an emphasis on broadcast media.