Florida is now one of the most active markets in the country, with the number of 2018 transactions roughly double that seen from 2013 through 2017. 

With seven deals in 2018, Florida was second only to Texas in the number of state-level transactions last year.


Average Deal Size Grows Larger

Not only has the number of deals increased, but the average deal size has grown larger as well. Average seller size by total annual operating revenue grew to $510 million in 2018, compared to an average seller size of $180 million in the five previous years. 

This growth in deal size is attributable in part to strategic partnerships between larger, financially stable health systems—such as Martin Health System and Health First—and even larger national and regional partners, as Florida-based systems seek to increase their scale and enhance capabilities to compete more effectively in a value-based environment.

2018 also marked a shift away from the prevalence of Community Health System (CHS) divestitures seen in recent years.

Not-for-Profit Systems Take Center Stage

In all seven of the 2018 Florida transactions, not-for-profit health systems were the acquirers. Large national systems such as Ascension and Advent Health continue to shore up their competitive position in the state. Cleveland Clinic has acquired two hospitals on Florida’s east coast, enabling it to gain scale in the highly competitive Florida market and diversify operations outside of Ohio. 

The trend of larger health systems jumping state lines to seek new growth opportunities is increasingly common throughout the Southeast region. Recent examples include North Carolina-based Atrium Health’s acquisition of Navicent in Georgia, and Louisiana-based Franciscan Missionaries of Our Lady (FMOL) Health System’s acquisition of St. Dominic Health Services in Mississippi.

Although for-profit systems did not make any Florida acquisitions in 2018, we expect that they will remain active acquirers going forward. HCA acquired six Florida hospitals between 2013 and 2017, and Steward Health Care, LifeBrite Hospital Group, and Prime Healthcare Services have been active acquirers in the state.

Heightened Activity Along Florida’s Competitive East Coast

Four of the seven deals in 2018 were along Florida’s east coast, with three of the four involving a seller with annual operating revenue in excess of $500 million. Given the highly competitive nature of the east Florida market, these assets have commanded high enterprise value to revenue and enterprise value to EBITDA multiples, in excess (on average) of 1.0X and 15.0X, respectively.


Competition in Florida is expected to increase with passage of a repeal of Florida’s certificate of need (CON) laws. As new competitors put pressure on the existing business model, health systems likely will accelerate strategies to lower costs and enhance patient experience and outcomes.  

Key Takeaways for Hospitals and Health Systems

  • Expect high activity levels to continue as both in-state and out-of-state systems seek opportunities to build scale and enhance geographic presence in Florida. 
  • Define your organization’s desired strategic position in the market, including a detailed understanding of the capabilities needed to maintain or achieve this position.
  • Seek partners that best support your specific goal and needs as statewide interest and activity provides access to a range of potential partners with unique value propositions.
  • Refine, communicate, and demonstrate your specific value proposition if your organization is seeking to acquire assets in the state, as sellers consider the potential benefits of multiple competing growth-oriented acquirers.