Transaction volume in healthcare IT (“HCIT”) has risen significantly in 2020, with a year-to-date total of 90 transactions, up from 66 year over year. Much of this increase was reflected in Q1, as Q2 totals in 2020 and 2019 were similar, at 35 and 34 HCIT transactions, respectively. Meanwhile, hospital and health system transactions remained steady, with 19 transactions announced, compared with 20 in Q2 2019. The year-to-date volume of 39 transactions is comparable to the 44 transactions announced year-to-date in 2019.

Across all other sectors, volume fell. The post-acute sector, which saw a dramatic slowdown in February and March following a strong start to 2020, experienced a year-over-year decline in volume of 34 percent, with only 45 transactions announced. Specifically, only nine home health transactions were announced in Q2 2020 versus 21 in Q2 2019. The behavioral health sector, meanwhile, recorded 15 transactions, down nearly 44 percent from Q2 2019, an unusually active quarter, when 27 transactions were announced. This compares to an average of 18 transactions over the past six quarters. Managed care and laboratory transaction volume also fell, recording three transactions each in Q2. This represents a 73 and 57 percent decrease, respectively, versus Q2 2019.

Distressed sales of hospitals and health systems picked up in Q2, with sellers cutting deals to ensure patients have access to care during the pandemic and avoid closures. Notable distressed sales include Seton Medical Center (Calif.); Seton Coastside Medical Center (Calif.), Williamson Memorial Hospital (W.V.), St. Francis Medical Center (Calif.), Galesburg Cottage Hospital (Ill.), Easton Hospital (Pa.), and St. Vincent's Medical Center (Ky.).