3 takeaways on the large number of mergers and acquisitions in healthcare revenue cycle management and IT

Greenberg Advisors, an investment bank in revenue cycle management (RCM) and healthcare IT (HCIT), recently released its 2021 Mergers and Acquisitions (M&A) Update, which describes investment and M&A activity in the RCM and HCIT sectors.

Three key takeaways in the report were:
• There was record-shattering M&A activity in healthcare exceeded $27 billion across 246 transactions.
• 86% of the transactions involved sellers with up to $50 million in revenue.
• There was increased appetite for targets with physician end-clients.

Among the reasons for the high level of activity, Greenberg Advisors said buyer interest was fueled by the abundance of and low-cost of capital combined with a multitude of opportunities created by the systemic and technological evolution occurring in the healthcare industry. Sellers further contributed given their concerns of a possible capital gains tax hike and the highly attractive valuations being placed on well-run businesses.

“2021 was a spectacular year for so many of our clients and for the market overall. Based on what we’re hearing from investors, combined with the velocity of capital pouring into the market, we expect this pace to continue well into 2022,” explained Brian Greenberg, CEO of Greenberg Advisors.

He said 2021 was a critical year, because of concerns about COVID and how it would impact investment activity. “The market definitely bounced back, showing its resilience and proving that the underlying forces that drive investments are alive and well in RCM and HCIT,” he added.