Ensuring one’s Presence in a Growth-Driven Healthcare Market

06.09.2017

Martin Henrichs from UBS discusses the rapid progress of M&A transactions and the key drivers for hospital and lab consolidation.


Consolidation – Key drivers and approaches for healthcare providers:

1. Why do we need to talk about consolidation?
Consolidation, the merger and acquisition (M&A) of different payers or providers, continues to be highly prevalent and fueled by powerful global trends in healthcare. These trends include a rise in global healthcare spending due to an aging population; the growing incidence of chronic diseases and comorbidities; the rapid scientific and technological progress; and increasing patient expectations. As a result, both payers and providers are in a race to grow their business through consolidation.

2. What are the benefits of consolidation to payers and providers?
Consolidation provides various, clinical, operational and financial benefits to payers and providers. On the one hand, both parties strive to increase their size to reach the critical mass which, for example, strengthens their negotiating position. On the other, M&A promises economies of scale and efficiency gains, which gives growing enterprises opportunities to improve profitability and leverage investments in modern technology, modern hospital architecture, and new delivery concepts.

3. How can providers make themselves essential in a consolidating market?
Consolidation activities are becoming increasingly common and may even gain momentum in the years ahead. There is a need for action, especially among smaller and less specialized providers. They can prepare by differentiating, acquiring, or joining forces with other health networks. While mergers frequently involve a considerable integration of expenditures, collaborations and strategic partnerships can also lead to desired results.
Want more insights? Download our white paper and find out more about how healthcare payers and providers jointly strengthen their respective market positions through consolidation.
 


About Siemens Healthineers

Our new name expresses our mission and what we stand for: Helping healthcare providers become more successful in caring for their patients.  

Our new name is unique. It embodies our pioneering spirit and our engineering expertise in the healthcare industry. It reflects the fact that this industry is increasingly driven by the skills of individuals. It also contains a commitment and a promise to our customers that we will use our pioneering spirit and our engineering expertise to help drive their success.


Share this page:

The statements by Siemens’ customers described herein are based on results that were achieved in the customer's unique setting. Since there is no "typical" hospital and many variables exist (e.g., hospital size, case mix, level of IT adoption) there can be no guarantee that other customers will achieve the same results.