Hospital and health system mergers and acquisitions decreased in Q2 compared to recent years, with only eight transactions announced, the lowest since 2017. No mega-mergers were reported, pushing the average seller size down to $175 million. Total transacted revenue hit $1.4 billion, the lowest in Q2 since 2017.

Despite the decline, the number of deals in Q2 saw a modest uptick from Q1. Market volatility and potential Medicaid cuts likely impacted deal numbers. President Trump signed a reconciliation bill with over $1 trillion in healthcare spending cuts, mostly affecting Medicaid, leading to revenue hits for providers.

The chilling effect on M&A from policy uncertainty has carried over into the first half of the year. Business challenges and policy uncertainties have influenced divestitures and affiliations in the market. Providers are expected to refocus their strategy and transformation efforts, potentially sparking greater activity in future quarters.

Read more at Yahoo Finance: Hospital, health system M&A falls in Q2 as Medicaid cuts loom: report