Even if some of these mergers and acquisitions were inevitable, and some of these trends were underway prior to passage of the ACA [Affordable Care Act], that law envisioned that providers would consolidate. The ACA was predicated on the kinds of changes unfolding in the way healthcare is delivered. They are a necessary precursor to many of the ACA’s constructs. 16
Consolidation is taking place in three distinct but intertwined parts of the healthcare industry: health services providers; 17 healthcare products manufacturers and sellers; 18 and third party-payers for health services and products. 19 Although there are countless organizational and financial permutations, consolidation among health service providers has primarily resulted in mergers and acquisitions, 20 providers going out of business21 or amending their business lines, or joint ventures involving multiple
Acute Care Sector Consolidation: Are We Seeing Trends Emerge From Deals Announced in 2013?, TRIPLE TREE BLOG (Feb. 3, 2014), http://www.triple-tree.com/blog/2014/02/03/post- acute-care-sector-consolidation-are-we-seeing-trends-emerge-from-deals-announced-in- 2013/. 16. Scott Gottlieb, The State of Competition in the Health Care Marketplace, AM. ENTER. INST. (Sept. 10, 2015), https://www.aei.org/publication/the-state-of-competition-in-the- health-care-marketplace; see also Terry L. Corbett, Healthcare Corporate Structure and the ACA: A Need for Mission Primacy Through a New Organizational Paradigm?, 12 IND. HEALTH L. REV. 103, 150-51 (2015) (discussing health care industry consolidation resulting from the ACA); but see Thomas Greaney, Examining Implications of Health Insurance Mergers, HEALTH AFF. BLOG (July 16, 2015), http://healthaffairs.org/blog/2015/07/16/ examining-implications-of-health-insurance-mergers (arguing that the ACA was meant to promote competition rather than consolidation). 17. Zack Budryk, Consolidation in Healthcare Will Continue in 2015, FIERCE HEALTH FIN. (Jan. 14, 2015), http://www.fiercehealthfinance.com/story/consolidation-healthcare-will- continue-2015/2015-01-14. 18. Andrew Ward, Arash Massoudi & Ed Hammond, Medical Device Makers in a Race to Merge, FIN. TIMES (June 16, 2014), http://www.ft.com/intl/cms/s/0/fa3061ba-f565-11e3- 91a8-00144feabdc0.html#axzz45jvbqP5C. 19. Robert Laszewski, Health Insurer Merger Mania – Muscle-Bound Competitors and a New Cold War in Health Care, FORBES (July 27, 2015, 2:55PM), http://www.forbes.com/ sites/robertlaszewski2/2015/07/27/health-insurer-merger-mania-muscle-bound-competitors- and-a-new-cold-war-in-health-care/#38919fff2647. 20. Michael E. Porter & Thomas H. Lee, Providers Must Lead the Way in Making Value the Overarching Goal, 91 HARV. BUS. REV. 51, 58 (2013) (“Most hospitals and physician groups still have positive margins, but the pressure to consider a new strategic framework has increased dramatically. Market forces are driving increasing numbers of hospital mergers and acquisitions”); see Stephen T. Moore, Orchestrating Successful Mergers and Acquisitions of Health Care Providers, ASPATORE, 2013 WL 2729766 (May 2013); see also Neal T. Goldstein & Deborah Gordon, Health Care M&A: Legal and Business Trends and Issues, ASPATORE, 2013 WL 2729772 (May 2013). 21. Melissa Newton, Home Health Care Providers Worry State Might Force Them Out of Business, CBS (Mar. 25, 2011, 5:01 PM), http://dfw.cbslocal.com/2011/03/25/home-health- care-providers-worry-state-might-force-them-out-of-business.