Becker's Hospital Review

17 THOUGHT LEADERSHIP Healthcare being both complicated and complex, it is going to be a thoughtful and concerted effort to bring independent hospitals together and talk about right- sizing care and scaling services to insure communities have access to the right care, by the right provider, in the right place. Brandi Fields, DNP, RN. Vice President of Clinical Services and Quality Improvement at UK King's Daughters (Ashland, Ky.): In my experience, hospital consolidations and the subsequent development of small- to-large integrated health systems have proven to be an effective strategy for reducing overhead costs while streamlining processes and advancing evidence-based practices to improve quality. When executed thoughtfully, these integrations can drive performance outcomes across the continuum of care impacting quality and patient experience. at said, it's equally important to regularly assess whether these consolidations are truly delivering on their intended goals, not only from a financial standpoint, but perhaps more importantly, from a quality and patient outcome perspective. Maintaining agility with the ongoing complexities of healthcare will remain essential to ensuring sustainability and continued excellence in patient care. Be open to pivot structures if intended impact is not seen. I imagine that in the next three to four years nearly every community hospital will either be affiliated with an integrated healthcare system or will be in discussion to do so. Gil Padula, MD. Chief Medical Officer and Market Medical Director of Case Management, St. Elizabeth Hospital and Youngstown Market at Bon Secours Mercy Health (Cincinnati): Looking to 2026 and beyond, I predict many more health systems will merge and form multi-state consortia and health delivery systems like we have not seen in the past. Declining reimbursement, inflation, and the need to develop more economies of scale will force our hand. Centralized IT, HR, and system-level board governance will continue to emerge. Local control of hospitals will continue to evolve and change. Jay S. Grider, DO, PhD, MBA. Chief Quality Officer and CEO of Kentucky Medical Services Foundation at University of Kentucky (Lexington): We've all heard of the health systems that are at risk of destabilizing because of financial constraints and government payer changes because of recent legislation. ese market forces will continue to drive health systems to seek consolidation. In Kentucky, we are attempting to take a little bit of an innovative approach in that we are attempting as an academic Medical Center to help support, where needed, underserved areas, and supply scarce clinical expertise to systems that are vulnerable. is initiative called Advancing Kentucky Together, seeks to stabilize and support rather than acquire and compete. It is our hope that through this work, we strengthen the infrastructure of healthcare across central and eastern Kentucky. Wayne Gillis. President and CEO of Rehoboth McKinley Christian Health Care Services (Gallup, N.M.): Consolidation will continue over the next three to four years but become more strategic and targeted rather than driven by blockbuster megamergers. Key drivers • Financial pressure (rising labor, inflation, capital costs) pushes weaker hospitals toward scale or partnerships. • Value-based care and payer risk contracts favor larger systems that can manage population health. • Labor shortages incentivize centralized staffing and shared services. • Tech costs (EMR, analytics, telehealth, AI) push smaller hospitals into networks or managed-service deals. • Growth will focus on ambulatory/ specialty (ASCs, oncology, cardiac, behavioral health). • Regulatory and antitrust scrutiny will limit some large deals but oen allow vertical or clinically justified integrations. • Rural hospitals will see more closures, affiliations, leases, or creative partnerships. Patterns to expect • More bolt-on acquisitions, regional roll-ups, MSOs and joint ventures (including PE and payer partnerships). • Specialty platform plays and care-at- home capabilities expand. • Activity concentrated in distressed rural and fragmented markets; highly concentrated metros see fewer transactions. Risks & signals to watch • Credit markets and capital availability, CMS reimbursement changes, and antitrust enforcement. • Watch bolt-on deal volume, rural affiliations/closures, payer-provider JVs, and PE activity in specialty services. Bottom line: Expect steady, selective consolidation focused on scale, specialty platforms, tech enablement, and flexible partnership models — not a new wave of blockbuster mergers. Robert Corona, DO. John B. Henry Professor of Pathology at SUNY Upstate Medical University; CEO of SUNY Upstate Medical University Hospital (Syracuse, N.Y.): My outlook is that hospital consolidation makes great sense for several reasons like spreading fixed operating costs and having scale to address rising labor costs and technology costs. Many of our regional standalone hospitals are struggling with negative margins and are reaching out to our AMC for help. We tried to consolidate with a large private teaching hospital located right next store which is connected to our hospital by a bridge. We ran into objections from the FTC and we couldn't find a way to overcome their concerns despite the solid and sensible business plan. We spent approximately two years working on that deal. Mark Whalen. Executive Vice President and Enterprise Chief Strategy and Transformation Officer of Jefferson Health (Philadelphia): Over the next three to four years, I expect hospital consolidation to continue, driven by a convergence of structural and strategic factors. Rising costs — particularly labor, pharmaceuticals and supply chain — are pushing systems to seek scale. At the same time, health systems are making significant investments in technology, especially AI, creating a need to spread the expenditures across larger networks. Finally, shiing demographics and the growing complexity of population health management make integrated, systemwide care models more attractive and sustainable. Sandy Balwan, MD. Chief Medical Officer of Northwell Direct; Senior Vice President and Executive Director of Northwell Health IPA at Northwell Health (New Hyde Park, N.Y.): My outlook is that hospitals will continue to consolidate over the next several years for several reasons. Need to increase their share of the commercially insured market, especially given the aging population Efficiency- survival of financially stressed organizations may be buttressed by larger, more stable organizations who can provide MSO type services at a lower cost Power in numbers- stronger negotiating

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