CompHealth Sizes Up Merger Activity

Monday's announcement that Aetna will buy Coventry Health Care underscores the trend in health care consolidation.  CompHealth, a Salt Lake City-based health care staffing firm, offers an interesting visual to illustrate the industry's merger activity based on a 2011 survey.  >>View: Healthy Growth?

Some of the findings for 2012:

• 75% of hospitals and health systems considering merger or acquisition
• 52% of merger deals valued < $50M
• Top reason for deal cancellation:  Culture Incompatibility

Source:  EMR Daily News

More Consolidation to Boost Govt Share

On the heels of the Wellpoint acquisition announcement of Amerigroup, Aetna has agreed to buy Coventry Health Care Inc. in a deal expected to close mid-2013.

"Integrating Coventry into Aetna will complement our strategy to expand our core insurance business, increase our presence in the fast-growing government sector and expand our relationships with providers in local geographies," according to Mark T. Bertolini, Aetna's chief executive.

The acquisition is expected to increase Aetna's share of government business to more than 30% from 23%.  >>Read more

More Health Care Deals Expected

Unless you've been under a rock, you know that the Supreme Court upheld the Affordable Care Act in late June.  Analysts expect the ruling to spur consolidation of health care companies looking to cash in on an increase in Medicaid enrollment.  Wellpoint led the way with its $4.9B acquisition of Amerigroup. Antoine Gara's article (Health Care:  Obamacare M&A Trumps Weak Earnings Outlook) suggests Humana, Cigna, Aetna and UnitedHealth could follow suit.  Recent comments regarding Centene may have elevated it to the takeover target frontrunner.