Five small-scale deals in the fourth quarter bucked a trend for larger acute-care acquisitions in the U.S. hospital sector, while major for-profit players beefed up their outpatient offerings.

The five acquisitions were consistent with the volume of acute-care hospital deal-making in the third quarter, but less than half of the 11 deals of the second, an S&P Global Market Intelligence analysis found.

The largest was Jefferson Health System, Inc.'s acquisition of fellow Philadelphia-based Albert Einstein Healthcare Network, including its four hospitals and 14 outpatient centers. The partnership between the two health systems will result in an integrated 18-hospital network, Jefferson Health said in its Oct. 4, 2021, news release.

The following month, Tennessee-based Ballad Health completed its acquisition of Johnston Memorial Hospital, Inc. and Smyth County Community Hospital Corp in rural southwest Virginia. The remaining acute care deals in the quarter involved the sale of a single hospital each.

Tenet, HCA expand

Beyond acute care, Tenet Healthcare Corp. said Nov. 8 that its United Surgical Partners International Inc. unit would acquire 92 ambulatory surgery centers from Surgical Center Development, Inc. The Dallas-based hospital company also acquired minority ownership interest in nine ambulatory surgery centers from Raleigh, N.C.-based Compass Surgical Partners LLC in October.

Tenet has an estimated stockpile of over $1.1 billion in capital to deploy for M&A, SVB Leerink analyst Whit Mayo said in a Feb. 9 note. Tenet's targets imply the acquisition of over 60 ambulatory surgery centers by the end of 2023 to keep the company on track for its 2025 goals, Mayo said.

HCA Healthcare Inc. expanded its own ambulatory care sites by 14% in the past year, bringing the total number of in-network sites to about 2,200, CEO Samuel Hazen said on a Jan. 27 earnings call. The Nashville-based hospital network began 2022 with the Jan. 4 acquisition of MD Now Medical Centers Inc., a group of 59 urgent care centers in Florida.

"These investments continue to add depth to our networks and convenience for our patients, creating an easier and more cost-effective accessibility for our healthcare systems," Hazen said on the earnings call.

There was a trend across 2021 for a smaller volume of hospital M&A being offset by a higher percentage of large transactions, hospital consulting firm Kaufman Hall said in a Jan. 10 report.

Eight of the announced transactions in 2021 were so-called mega-mergers, or transactions where the seller or smaller partner had over $1 billion in revenue. This marked the largest percentage of these transactions in the last six years, Kaufman Hall said.