Deloitte Point of View: After Health Care Reform, Mergers and Acquisitions Not So Clear Cut

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Deloitte

Oct 20, 2010, 10:00 ET

NEW YORK, Oct. 20 /PRNewswire/ --

What: "Health Plans and Providers: Implementing Strategic M&A Transactions in a Post-reform Environment"

Who:

Brian Flanigan, principal, Deloitte Consulting LLP

Phil Pfrang, partner, Deloitte & Touche LLP

Simon Gisby, principal, Deloitte Financial Advisory Services LLP

Kyle Woitel, partner, Deloitte Tax LLP

When: Available immediately

Where: www.deloitte.com/us/planandproviders

Passage of the Patient Protection and Affordable Care Act (PPACA or the Act) of 2010 presents a unique set of opportunities and challenges for the health care industry as a whole. Moreover, the new legislation also is likely to significantly increase the level of merger and acquisition (M&A) activity for health plan and health care providers in the United States including mergers, acquisitions, joint ventures, partnerships and affiliations.

As a result, health care organizations may need to strategically evaluate the risks and opportunities of potential transactions to complete a successful deal in today's complex, post-reform environment.

"Health Plans and Providers: Implementing Strategic M&A Transactions in a Post-reform Environment," a new paper from Deloitte, offers insights on how health care organizations can strategically evaluate the risks and opportunities of potential transactions in today's complex, post-reform environment. In the paper, Deloitte looks at the various types of companies, including:

Providers. Many physician practices currently are in play; either they are looking to sell or — if they are a larger IPA — looking to acquire. It is the same with hospitals – there is considerable M&A activity, particularly among those organizations that may face the prospect of deteriorating financial performance. Adding impetus to these changes is an influx of capital and activity from private equity buyers increasing their participation in the sector.

Health Plans. As health plans, large and small, begin to develop the strategic responses necessary to effectively address health care challenges, many will look to M&A activity for either offensive or defensive purposes. Some smaller health plans with less scale may seek the safe haven of larger players with bigger balance sheets and more diversified business portfolios. Larger players, in turn, may seek to enter new lines of business to further diversify their revenue streams, and/or aggressively seek either distressed targets or other like-minded players with complementary assets, values and objectives.

To view a full version of the paper, please go to: www.deloitte.com/us/planandproviders.

Please contact John La Place at [email protected], or +1 212-492-4267 to arrange an interview.

About Deloitte

As used in this document, "Deloitte" means Deloitte LLP and its subsidiaries. Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries.

SOURCE Deloitte