Mid-Year Review of M&A Transactions and Trends
This Bulletin is brought to you by AHLA’s Behavioral Health Practice Group.
- August 29, 2023
- Mason Motal , VMG Health
- Clinton Flume , VMG Health
Behavioral health M&A deals have continued to show a downward trend through the second quarter of 2023. Based on data gathered by VMG Health, these deals are down approximately 32% compared to year-to-date (YTD) 2022. This decline in deal volume is primarily driven by economic turmoil from high staffing costs, reimbursement challenges, rising interest rates, pressure on existing out-of-network strategies, and conflicts overseas. However, the outlook for behavioral health is still positive with future opportunities in artificial intelligence (AI), telehealth services, and mutually beneficial partnerships between behavioral health operators and nonprofit health systems. According to Dexter Braff, president of The Braff Group— one of the nation’s leading advisers in behavioral health care transactions—demand for behavioral health services is still strong and far outweighs the supply. Investors are just taking a more disciplined approach on the volume of deals they seek out and what they are willing to pay.
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