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Health system M&A scorecards: A data-driven look at likeness

To understand and evaluate current mergers and acquisition activity for U.S. health systems, Becker's Healthcare leveraged Trilliant Health's SimilarityEngine™ to analyze how similar — or dissimilar — top-performing hospitals of merged health systems are to one another.

The SimilarityEngine™ evaluated the following key metrics for its M&A analysis to develop more tailored cohorts compared to hospital cohort criteria leveraged in the publicly available SimilarityIndex™ | Hospitals

"While many factors influence the success of a transaction, the similarity of the health systems is a powerful predictor of the likelihood that the systems will successfully integrate," Trilliant Health CEO Hal Andrews said. 

Competitive and financial metrics are critical to informed health system M&A decision-making, in addition to understanding market dynamics and service mix. Each M&A scorecard uses Trilliant Health's SimilarityEngine™ to compare hospitals across numerous financial, operational and competitive metrics.

SimilarityIndex™ | Hospital M&A Cohort Metrics
SimilarityIndex™ | Hospitals Cohort Metrics
Intern Residents per Bed Operating Expenses per Adjusted  Discharge Intern Residents per Bed
Bed Size Occupancy Percent Bed Size
Medicare Case Mix Index Return on Capital Medicare Case Mix Index
Population Size Inpatient Market Share Population Size
Age Distribution Outpatient Market Share Age Distribution
Discretionary Income Third Party Payer Mix Percent Discretionary Income
Household Debt Hospital Share of Care Household Debt
Net Patient Services Revenue (NPSR) per Adj Discharge System Share of Care Service Mix

The more similar these hospitals are based on markets, services, financial and competitive metrics, the higher probability that the merged system will continue with the established "playbook" and fully integrate (i.e., the merger will play to systems' strengths). The more dissimilar these hospitals are, the more likely it is that systems will have greater difficulty fully integrating.

Below, find a menu of M&A scorecards detailing combinations' SimilarityIndex™ M&A Score, powered by Trilliant Health SimilarityEngine™ for 12 transactions and deals announced or pursued so far in 2023. For mergers, the similarity of each system's flagship hospital is analyzed. For each hospital listed, scorecards contain the number of other hospitals that are more similar than the one being merged or acquired.

Announcement Hospital Rank Similarity
Flagler Health+, which announced a merger with UF Health in Florida  UF Health Shands Hospital 863 59.3
Flagler Hospital 1709
Singing River Health System in coastal Mississippi announcing its decision to merge with Louisiana-based Franciscan Missionaries of Our Lady (FMOL) Health System Our Lady of the Lake Regional Medical Center 793 72.5
Singing River Gulfport 1089
Community Health System announced the sale of two North Carolina hospitals (Lake Norman Regional Medical Center and Davis Regional Medical Center) to Novant Health Lake Norman Regional 1799 57.9
Forsyth Memorial Hospital 1625
Steward Health Care announced the sale of its Utah care sites, including five hospitals to CommonSpirit Health/Centura Health Penrose/St. Francis Healthcare 542 75.3
Jordan Valley Medical Center 840
John Muir Health buying out Tenet Health's 51% ownership stake in San Ramon Regional Medical Center John Muir Medical Center 7 84.7
San Ramon Regional Medical Center 12
BJC HealthCare of St. Louis (BJC) and Saint Luke’s Health System of Kansas City (Saint Luke’s) have signed a letter of intent to merge Barnes–Jewish Hospital  45 76.6
Saint Luke's Hospital of Kansas City  667
The University of Pittsburgh Medical Center (UPMC) has signed a letter of intent to acquire Washington Health System (WHS)  UPMC Presbyterian Shadyside 811 64.7
The Washington Hospital 1407
Froedtert Health and ThedaCare have signed a letter of intent to merge  Froedtert Memorial Lutheran Hospital 1018 70.9
Thedacare Regional Medical Center  433
Vandalia Health announcing a non-binding letter of intent for Davis Health System to join Vandalia Health  Charleston Area Medical Center 991 61.7
Davis Medical Center 465
Ascension: Ascension Providence Hospital will be sold to the University of South Alabama, based in Mobile  USA Health University Hospital 229 73.3
Providence Hospital 1134
Binghamton, NY-based Our Lady of Lourdes Memorial Hospital will be sold to the Pennsylvania-based Guthrie Clinic  Robert Packer Hospital 530 66.1
Our Lady of Lourdes Memorial Hospital 1132
St. Luke’s to merge with Aspirus Health   St. Lukes Hospital  1418 68.3
Aspirus Wausau Hospital  311
OHSU and Legacy Health agree to merge  OHSU Hospital  98 73.9
Legacy Emanuel Hospital  511

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