Health systems will continue to “look beyond traditional inpatient services for new growth opportunities,” in 2026, according to a Jan. 15 report from Kaufman Hall.
Kaufman Hall said that health systems are increasingly pursuing non-acute and capability-based partnerships. The firm pointed to two examples from 2025. The first was St. Louis-based Ascension’s June announcement that it entered an agreement to acquire ASC operator AmSurg, which has more than 250 facilities across 34 states.
The second was Grand Rapids, Mich.-based-based Corewell Health’s laboratory joint venture with Quest, which was announced in September and finalized Jan. 5. The partnership created Diagnostic Lab of Michigan and reflects health systems’ growing interest in non-acute, capability-based collaborations.
Kaufman Hall expects continued interest in these types of deals in 2026.
In 2026, Kaufman Hall also expects large and national health systems — particularly for-profit operators and Catholic systems — to continue divesting non-core assets, “based on a growing realization that scale alone is no longer a sufficient growth or margin strategy, particularly without scale at the market or regional level.”
The percentage of transactions involving a divestiture was 45.6% in 2025, according to the report. For-profit systems were the seller in 11 deals, but the acquirer in only one.
“This is a signal of the financial challenges facing hospitals in the current environment and illustrates a shift in for-profit entities’ investments to other healthcare services subsectors or an exit in general,” the report said.
Kaufman Hall said uncertainty surrounding the extension of the enhanced ACA subsidies that expired at the end of 2025 and the anticipated effects of the One Big Beautiful Bill Act beginning in 2027 will weigh on strategic planning and capital deployment decisions this year. The firm predicts the trend of a high percentage of transactions involving financially distressed organizations will continue.
Kaufman Hall also said there are indications that states may be taking a more conciliatory approach to healthcare transactions, “especially in instances where financial distress raises the prospect of a hospital closure.”
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