Hospital and health system M&A activity ramps up in Q1
CHICAGO – April 9th, 2026 – Hospitals and health systems were involved in 22 announced M&A transactions in the first quarter of 2026—the highest level of Q1 M&A activity since 2020—according to the latest analysis from Kaufman Hall, a Vizient® company.
“Health system M&A activity continues to rebound from the policy and market-related uncertainty of early 2025,” said Courtney Midanek, managing director and co-leader of Kaufman Hall’s M&A practice. “Organizations are increasingly aware that partnerships can help them face future challenges and opportunities.”
Transacted revenue totaled $14.5 billion, the highest Q1 figure in recent years. There were three mega mergers, or transactions in which the smaller organization has annual revenue in excess of $1 billion.
Only four of the 22 transactions (18%) involved a financially distressed seller, a relatively low proportion compared to recent trends. Divestitures represented 15 of the 22 transactions (68%).
“This quarter’s trends reflect an industry undergoing transformation,” said Kris Blohm, managing director and co-leader of Kaufman Hall’s M&A practice. “Health systems are repositioning by withdrawing from underperforming or non-core markets, building capital to invest in new capabilities, proactively seeking partners to increase resilience or enhance access to care and services, and placing big bets on new combinations of resources and capabilities.”
Hospital financial outlook softens
Hospitals are experiencing a fragile financial outlook in early 2026, according to Kaufman Hall’s most recent National Hospital Flash Report.
Hospital expenses remain elevated, while revenues are pressured by an eroding payer mix and remain below sustainable levels. Patient days have softened in early 2026, while the average length of stay remains relatively steady, reflecting both demographic shifts and changes in where care is delivered.
“Hospitals are off to a relatively soft start in 2026,” said Erik Swanson, managing director and leader of the Data and Analytics Group at Kaufman Hall. “Outpatient care strategies offer a potential path forward, though hospitals must manage both revenue dilution and a greater concentration of high-acuity patients as a result.”
The National Hospital Flash Report draws on data from more than 1,300 hospitals from Strata Decision Technology, LLC.
About Kaufman Hall, a Vizient Company
Kaufman Hall, a Vizient® company, provides management consulting solutions to help society’s foundational institutions realize sustained success amid changing market conditions. Since 1985, Kaufman Hall has been a trusted advisor to boards and executive management teams, helping them incorporate proven methods, rigorous analytics, and industry-leading solutions into their strategic planning and financial management processes, with a focus on achieving their most challenging goals.
Kaufman Hall services use a rigorous, disciplined, and structured approach that is based on the principles of corporate finance. The breadth and integration of Kaufman Hall advisory services are unparalleled, encompassing strategy; financial and capital planning; performance improvement; treasury and capital markets management; mergers, acquisitions, partnerships, and joint ventures; and real estate.
FOR IMMEDIATE RELEASE: Thu., April 9, 2026
CONTACT: Nancy Matocha, nancy.matocha@vizientinc.com