Hospital and health system merger and acquisition activity remained strong during the second quarter of 2026, with 18 announced transactions marking one of the busiest second quarters since 2019, according to a new analysis from the Chicago-based consulting firm Kaufman Hall, a Vizient company.

The report found that transaction momentum carried over from the first quarter as more health systems pursued partnerships as part of long-term strategic planning rather than in response to financial distress.

Transacted revenue reached $7.7 billion during the quarter, rebounding from second-quarter 2025 levels. Kaufman Hall attributed part of the increase to three "mega mergers," defined as transactions involving a smaller organization with more than $1 billion in annual revenue. Those deals pushed the average seller size to $428 million.
Two-thirds of second-quarter transactions involved independent health systems seeking a partner, a trend the firm said reflects organizations pursuing growth, expanded capabilities and long-term sustainability.

“The strong pace of M&A activity continued through the second quarter while the profile of the organizations pursuing partnerships and the underlying strategic rationale continued to shift,” said Courtney Midanek, managing director and coleader of Kaufman Hall’s M&A practice.

Kris Blohm, managing director and coleader of the firm's M&A practice, said health systems are evaluating partnership options earlier in their planning cycles and focusing on complementary capabilities instead of waiting until consolidation becomes necessary.

Separately, Kaufman Hall's latest National Hospital Flash Report found that outpatient volumes continued to increase year over year through May 2026, reflecting the ongoing shift of care from inpatient to outpatient settings.

At the same time, hospitals continued to face financial pressure from elevated labor, non-labor and purchased services expenses compared with the same period last year.

“Health systems must adapt their portfolios and operations to support the future of care delivery,” said Erik Swanson, managing director and leader of the Data and Analytics Group at Kaufman Hall.

The National Hospital Flash Report is based on data from more than 1,300 hospitals collected by Strata Decision Technology.

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