Gary W. Herschman, Member of the Firm, and Yulian Shtern, Associate, in the Health Care and Life Sciences practice, in the firm’s Newark office, were cited in McKnight's Long-Term Care News,in “LTC Leads Hot Healthcare Market in First Half of 2019,” by Kimberly Marselas.
Following is an excerpt:
Citing slightly different numbers, attorneys and analysts with Epstein, Becker & Green reported in Bloomberg News last week that the long-term care sector is the most active in health-care sector through June. Their analysis included 143 announced or closed transactions.
That is up 43% from the 100 long-term care transactions through the first six months of 2018, according to the Bloomberg Law-Healthcare Advisory Panel.
The Epstein experts, writing with representatives from ECG Management Consultants, pointed to the surging aging population and recent healthcare initiatives that expanded insurance coverage as major M&A drivers. While volume has grown, the shifting payer mix and lower reimbursement rates provided for Medicare and Medicaid patients means providers are seeking more strategic alignments.
“Long-term care organizations have shifted focus to improving operational efficiencies via economies of scale, resulting in further industry consolidation,” they wrote. “In addition to strategic acquisitions, long-term care organizations also have attracted interest from financial sponsors such as private equity groups and real estate investment trusts (REITs) due to the sector’s relatively stable cash-flows and inherent value of the real estate that comes packaged with business operations.”