10 Major Healthcare Merger & Acquisition Deals Announced in 2020

Intermountain Health-Sanford Health merger

The most recent transformational healthcare merger and acquisition announced in 2020 involves Utah’s largest hospital system Intermountain Healthcare and South Dakota-based Sanford Health.

In October 2020, the two non-profit health systems signed a letter of intent to develop a strategic partnership.

That partnership would create a combined organization of 70 hospitals and 435 clinics across seven states, as well as senior care and services in 366 locations in 24 states. The organization would also insure 1.1 million people.

Health system leaders from both organizations plan to complete the merger in 2021.

Atrium Health-Wake Forest Baptist Health merger

Charlotte, North Carolina-based Atrium Health and neighboring Wake Forest Baptist Health recently announced the completion of a healthcare merger deal to create a “next-generation academic health system” worth $11 billion.

The health systems agreed to merge last year in a deal that also included Wake Forest Baptist Health’s Wake Forest School of Medicine. Now a single entity, the organization plans to build a second campus for the school of medicine in addition to operating a combined 42 hospitals and 1,500 care locations across North Carolina, South Carolina, Georgia, and Virginia.

“As the healthcare field goes through the most transformative period in our lifetime, in addition to a new medical school, our vision is to build a ‘Silicon Valley’ for healthcare innovation spanning from Winston-Salem to Charlotte,” Eugene A. Woods, president and CEO of the new Atrium Health, said in the announcement.

Advocate Aurora-Beaumont Health merger

A proposed merger between Advocate Aurora Health, based in Illinois and Wisconsin, and Michigan-based Beaumont Health was one of the largest healthcare merger and acquisition deals announced during the pandemic.

The health systems signed a non-binding letter of intent to discuss a potential healthcare merger in June. However, by October, leaders called off the discussions and tabled the proposed deal.

Beaumont Health leader John Fox said they are not moving forward with the a merger deal to focus on local market priorities and the health system’s employees, who have been vocal about their opposition to the merger.

Together, the health systems would have created a $17 billion health system.

Steward Health Care doctors acquire a controlling stake

Steward Health Care recently announced that a team of doctors acquired controlling stake of the Texas system to become the largest physician-owned and operated health system in the US.

The health system explained in the June announcement that it structured a recapitalization transaction with private equity firm Cerberus Capital Management to transfer the controlling interest to the management group of Steward physicians. The group is led by Steward’s CEO Ralph Ralph de la Torre.

“This is a transformational moment for the health care industry, with new realities in a COVID-19 world that must be addressed with an equally transformational, patient-first approach,” said de la Torre at the time. 

Virginia Mason acquisition by CHI Franciscan/Commonspirit Health

Washington-based health systems Virginia Mason and CHI Franciscan, along with its parent company Commonspirit Health, signed an agreement to explore combining into a joint operating company, according to an announcement from July.

The health systems have partnered together in the past and recently came to the decision to explore a closer partnership, stated J. Patel, CEO of CHI Franciscan and president of the Pacific Northwest Division at CommonSpirit Health. 

Commonspirit Health is the new health system from the merger between Dignity Health and Catholic Health Initiatives. The health system giant has nearly $29 billion in revenue and 137 hospitals, with CHI Franciscan representing about $2.45 billion in revenues and 10 hospitals.

Virginia Mason is a smaller health system comprising two hospitals, a primary and specialty care group practice of more than 500 physicians, and outpatient medical facilities and services throughout the Pacific Northwest.

Cone Health-Sentara Healthcare merger

Cone Health and Sentara Healthcare, two multi-billion-dollar health systems in the South, announced in August that leaders from both organizations have signed a letter of intent to merge.

The announcement stated that the health systems are looking to combine in order to implement a “unique value-based approach that is focused on keeping people healthy and well, while providing high-quality, accessible and affordable health care in more ways and in more places.”

The communities served by the two health systems do not overlap, but through a merger, leaders intend to provide more options for patients through the organization’s provider and health insurance services.

Leaders expect the merger to be finalized by mid-2021.

Harrington HealthCare acquisition by UMass Memorial Health Care

Massachusetts health systems UMass Memorial Health Care and Harrington HealthCare revealed in September that both organizations have reached an agreement on definitive terms for a corporate affiliation.

Per the agreement, Harrington would become a member hospital within UMass Memorial Health Care, while allowing Harrington HealthCare System and Harrington Memorial Hospital to maintain local community boards with reserved powers held by a UMass Memorial subsidiary.

Potential benefits of the acquisition deal, according to the health systems, include investments in facility, equipment, and other infrastructure; integration of an Epic EHR system at Harrington; and high-quality, affordable care access.

Novant Health-UNC Health-New Hanover Regional Medical Center partnership

Novant Health and UNC Health unveiled a partnership in May to expand a medical education program at New Hanover Regional Medical Center (NHRMC) in North Carolina.

Novant Health, UNC Health, and UNC School of Medicine signed a letter of intent to partner on the NHRMC venture in the event local officials allowed Novant Health to purchase or affiliate with the medical center. Officials approved the sale in early October.

The health systems plan to leverage the sale to enhance pediatric specialty services, as well as graduate medical education, clinical training, and research.

Lifespan-Care New England merger

Two health systems in Rhode Island – Care New England and Lifespan – recently resumed healthcare merger talks after shelving a potential partnership last year. Leaders signed a letter of intent to merge in September to create a Rhode Island-based, non-profit academic medical center with Brown University.

The combined system would also include seven hospitals and have over 23,500 employees.

The health systems said COVID-19 prompted them to reconsider a merger after the providers came together during the crisis to serve their shared communities.

Four hospitals in South Chicago seek merger

Advocate Trinity Hospital, Mercy Hospital & Medical Center (a member of Trinity Health), South Shore Hospital, and St. Bernard Hospital announced at the start of the year that they wanted to create a single system to address health inequities in their community of South Chicago.

The hospitals would have created an independent, integrated system that would invest $1.1 billion to construct community health centers and at least one destination hospital to replace aging facilities.

However, the hospitals ended talks in May after Illinois lawmakers decided not to approve the funding for the combined system’s goals.