Hospital M&A strategy is diverging as certain national and regional health systems pursue contrasting paths.
On one side, several national health systems have shifted into divestiture mode — selling hospitals to reduce debt, improve margins and redeploy capital into higher-return business lines. On the other hand, some regional systems are moving quickly to acquire facilities, expanding their geographic reach and doubling down on community-based care.
Over the last two years, St. Louis-based Ascension has sold or consolidated about 35 hospitals across the country as part of a sweeping financial turnaround plan. After spending much of that time revamping its portfolio and operating model, the Catholic system has recently signaled a return to acquisition mode, but with a sharper eye on performance and alignment.
Franklin, Tenn.-based Community Health Systems, a 70-hospital, for-profit system, has followed a similar path.
Since 2020, CHS has announced or completed the sale of 39 hospitals in its effort to lighten a debt load that stands at $10.8 billion. In 2025 alone, the health system has divested its ownership interest in six hospitals and plans to sell Commonwealth Health — a three-hospital system headquartered in Scranton, Pa. — to Tenor Health Foundation for $120 million. CHS also signed a $195 million deal with Labcorp to transfer leases and sell selected assets of its ambulatory outreach lab services across 13 states.
For CHS, every transaction is part of a broader goal: deleveraging its balance sheet and reshaping its portfolio around markets it can defend and grow.
Dallas-based Tenet Healthcare, a 50-hospital system, is also leaning into divestitures as a path to transformation. Last year it sold 14 hospitals for more than $4.8 billion, a move designed to create a more geographically aligned and specialty-driven portfolio. At the same time, Tenet has been deliberate about preserving connections to former facilities through Conifer Health Solutions, its revenue cycle subsidiary. Many buyers of Tenet hospitals have also expanded their relationships with Conifer, positioning Tenet not just as a seller, but as an ongoing partner.
While for-profit, national systems have been scaling back, nonprofit, regional systems are expanding their reach. Orlando (Fla.) Health made a major leap into Alabama with its $910 million acquisition of Tenet’s 70% stake in Brookwood Baptist Health, effective Oct. 1. Orlando Health now manages day-to-day operations of the five-hospital system — which rebranded in January — in partnership with Baptist Health System.
In the Upper Midwest, Sioux Falls, S.D.-based Sanford Health and Marshfield (Wis.) Clinic Health System merged at the start of 2025, creating a 56-hospital integrated system. The merger brought together two strong regional brands under a unified leadership structure while maintaining separate health plans.
The Northeast has also seen consolidation. New Hyde Park, N.Y.-based Northwell Health merged with Danbury, Conn.-based Nuvance Health in May to create a $23 billion system with 28 hospitals, more than 104,000 employees and over 1,000 ambulatory care sites.
Michigan has emerged as another center of regional expansion. Detroit-based Henry Ford Health recently entered into a joint venture with Ascension Michigan, combining 13 hospitals and more than 550 care sites. The new entity retained all 17,000 Ascension employees and began rebranding facilities under the Henry Ford Health name.
That deal was followed months later by South Bend, Ind.-based Beacon Health System acquiring four hospitals and dozens of outpatient sites from Ascension Southwest Michigan, bringing 2,700 employees and 259 providers into its fold.
The contrast could not be clearer. National systems are paring back to strengthen their balance sheets and concentrate on scalable service lines. Regional systems, meanwhile, are acquiring and integrating to build local strength, community ties and geographic dominance.
Both approaches carry risks. For national systems, success depends on whether tighter focus and lighter portfolios can deliver consistent returns in an unpredictable reimbursement environment. For regional systems, the challenge will be integrating new hospitals, maintaining workforce stability and managing capital demands without overextending.
