Healthcare Policies on the Line and Shifting M&A Strategies with Alan Condon - Becker’s Healthcare Podcast

Summary4 min read

Episode Overview

Podcast: Becker’s Healthcare Podcast
Episode: "Healthcare Policies on the Line and Shifting M&A Strategies with Alan Condon"
Date: September 22, 2025
Main Theme:
The episode explores two urgent topics affecting healthcare leaders: the high-stakes healthcare policy negotiations in Congress as a potential government shutdown looms, and significant trends in hospital mergers, acquisitions, and divestitures, particularly focusing on the shifting strategies among national and regional health systems.

Key Discussion Points & Insights

1. Critical Healthcare Policies at Risk Amid Congressional Standoff

[00:55 – 03:10]

Government Funding Deadline:
Congress faces a crucial September 30th deadline. There is a risk of government shutdown, with House Republicans proposing a short-term extension to mid-November.
“Congress obviously faces a September 30th deadline with House Republicans proposing a short-term resolution through middle November or so.” – Alan Condon [01:14]
Contentious Healthcare Provisions:
- Democrats' Stance: Refusal to support deals omitting essential provisions, notably the Affordable Care Act's premium tax credits.
- Potential Impact: These credits are set to expire at the end of 2025, which could cause:
  - An estimated 18% median hike in 2026 insurance rates.
  - A projected $28 billion drop in hospital spending over the next decade (per the American Hospital Association).
  “Those tax credits are set to expire at the end of 2025, potentially leading to about an 18% median hike, 2026 coverage rates, and about a $28 billion drop in hospital spending over the next 10 years.” – Alan Condon [01:36]
Expiring Programs:
- Telehealth: Emergency flexibilities for telehealth created during the pandemic are set to expire unless Congress acts.
- Hospital at Home Program: Also at risk of lapsing at the end of September.
- Bipartisan Efforts: Bills are in progress to either extend or permanently authorize these programs, with one proposal to extend Hospital at Home to 2030.

2. Shifting M&A Strategies: National vs. Regional Health Systems

[03:11 – 06:38]

National Health Systems in Retreat:
- Many national giants are selling off hospitals and reorienting their business:
  - Tenet Healthcare, Community Health Systems (CHS), and Ascension:
    - Moving into "divestiture mode" to reduce debt, strengthen margins, and focus on high-return, outpatient, or specialty areas.
    - "Over the last two years or so they've sold or consolidated about 35 hospitals across the country." – Alan Condon [04:05]
  - Community Health Systems:
    - Announced/completed the sale of about 39 hospitals since 2020, debt currently just under $11 billion. “CHS has announced or completed the sale of about 39 hospitals really to reduce its debt load. That stands at just under $11 billion at the moment.” – Alan Condon [04:35]
  - Tenet Healthcare:
    - Exception in that it’s transforming already-profitable operations. Sold 14 hospitals in 2024 for nearly $5 billion, aiming for a more geographically and specialty-aligned portfolio. “In 2024, Tenet sold 14 hospitals for nearly $5 billion really as it looks to create a more geographically aligned and specialty-driven portfolio.” – Alan Condon [05:05]
Regional Health Systems Seize the Moment:
- Opportunistic acquisitions by smaller and regional players:
  - Orlando Health:
    - Major move into Alabama via $900 million acquisition of Tenet’s stake in Brookwood Baptist Health (a five-hospital system).
  - Sanford Health + Marshfield Clinic:
    - Merger created a 56-hospital integrated nonprofit system in the Upper Midwest.
  - Northwell Health + Nuvance Health:
    - Merger forming a $23 billion, 28-hospital nonprofit stretching from New York to Connecticut.
  “Orlando Health, for example, recently made a huge step into Alabama with its $900 million acquisition of Tenet’s majority stake in Brookwood Baptist Health … We look to the Northeast. We've also seen some consolidation there. Northwell Health, headquartered in New York, merged with Nuvance Health from Connecticut. That's created a $23 billion, 28-hospital nonprofit system as well.” – Alan Condon [05:38 & 05:55]
Strategic Divergence:
- Nationals focus on debt reduction, profitability, and core service lines.
- Regionals double down on geographic expansion, community-based care, and growth through acquisition.

“A ton of action, a ton of diverging M&A strategies in terms of what national health systems and regional health systems are doing…” – Alan Condon [06:22]

Notable Quotes & Memorable Moments

“Several high-stakes healthcare policies really hang in the balance here.” – Alan Condon [01:07]
“Close, close eye on what's going on on Capitol Hill.” – Alan Condon [02:39]
“Really spending much of that time revamping its hospital portfolio and its operating model. And recently signaled a return to acquisition mode, but really keeping a sharp eye on performance and alignment.” – Alan Condon [04:18]
“Fantastic leadership. Operates in really great markets across the country.” (on Tenet Healthcare) – Alan Condon [05:00]
“So a ton of action, a ton of diverging M&A strategies…” – Alan Condon [06:22]

Important Segment Timestamps

00:55 – Introduction to key healthcare policies and Capitol Hill dynamics
01:36 – Discussion of Affordable Care Act premium tax credits and potential impact
02:20 – Telehealth and Hospital-at-Home program legislative status
03:11 – Shift to mergers, acquisitions, and divestiture strategies
04:05 – Examples of national system sell-offs and financial strategies
05:05 – Tenet Healthcare’s unique strategic pathway
05:38–05:55 – Regional health system acquisitions (Orlando Health, Sanford/Marshfield, Northwell/Nuvance)

Summary

This episode delivers a compact but insightful briefing for healthcare leaders monitoring critical U.S. policy decisions and the M&A landscape. Alan Condon highlights the immediate risk to key healthcare programs tied to congressional negotiations, detailing the high financial and operational stakes for hospitals nationwide. He also expertly tracks the diverging strategies reshaping hospital ownership, with national systems retrenching while regionals step in to expand. The episode is rich in timely detail—essential listening for executives and policymakers navigating today’s turbulent healthcare environment.

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Transcript4 lines

[00:01]
A
Exciting things are happening at Beckers Healthcare Stay ahead of industry trends with the new Beckers CFO plus Revenue Cycle Podcast Your go to source for insights from top healthcare finance leaders. Tune in wherever you get your podcasts and don't miss the 10th annual Health IT Digital Health RCM Conference happening September 30 to October 3, 2025 in Chicago. Join thousands of executives, engage with industry leaders and explore the future of healthcare innov. Learn more about our upcoming events@beckershospitalreview.com See you there. This is Gracelyn Keller with the Becker's Healthcare Podcast, and I'm excited today to be joined by one of our regular guests, Alan Condon. Alan, thanks for being here. I understand you have two different stories and topics you'd like to discuss today, so I'm going to turn it over to you and let's hear what you've prepared.
[00:55]
B
Yeah, absolute pleasure. Thanks so much for teaming me up. Grace. So I think to your point, two stories following closely at the moment. I think first and foremost, certainly for hospital leaders, is really what's happening on Capitol Hill with a number of key health care policies as we approach a potential government funding shutdown on September 30th. So several high stakes health care policies really hang in the balance here. I just heard a couple quick kind of takeaways from what we're focused on and what hostile executive audience are really keeping a close eye on. So Congress obviously faces a September 30th deadline with House Republicans proposing a short term resolution through middle November or so. Democrats on one hand are saying that they won't support any deal that really excludes key health care provisions, such as, for example, the Affordable Care Act's premium tax credits. So those tax credits are set to expire at the end of 2025, potentially leading to about an 18% median hike, 2026 coverage rates, and about a $28 billion drop in hospital spending over the next 10 years. That's the latest, according to the American Hospital Association. A couple of other healthcare policies that are also in the mix here, telehealth, future hospitals and providers across the country, and also the hospital at home program as well. So both of those programs are set to expire as well on September 30 unless extended by lawmakers. There's a couple of bipartisan bills in the works at the moment that would make those pandemic era flexibilities for telehealth extend them or potentially make them permanent. Another bill would potentially extend the hospital at home program through 2030 so a couple of key healthcare policies really ongoing at the moment. Close, close eye on what's going on on Capitol Hill. Grace, just a quick kind of breakdown there of what we're paying close attention to for hospital ears and then jumping right into our next story. So more of a trend piece with something we've been paying close attention over the last few quarters the last year or so seeing a lot of those national health systems exit tough markets across the country as some of those more regional health systems really look to capitalize on growth opportunities here. So just to pull out a few key examples to kind of highlight this trend, we've seen several national systems, like I said, the likes of tenant healthcare, Community Health Systems, two Big for profits and Ascension, a large faith based nonprofit system shifting into divestiture mode recently selling hospitals to reduce death, improve their margins, redeploying capital into higher return business lines, focusing on outpatient specialty areas and growth. There's on the other hand of the spectrum we've seen some regional health systems moving quickly to acquire some of those hospital facilities. So expanding their geographic reach, doubling down on that community based care essentially I just kind of noted there over the last two years or so they've sold or consolidated about 35 hospitals across the country. That's really as part of a sweeping financial turnaround plan, really spending much of that time revamping its hospital portfolio and its operating model. And recently signaled a return to acquisition mode. But really keeping a sharp eye on performance and alignment. Community Health systems, who I touched on a little bit, there are 70 hospital for profit system followed a very similar path since 2020. Over the last five, five and a half years or so CHS has announced or completed the sale of about 39 hospitals really to reduce its debt load. That stands at just under $11 billion at the moment. The one caveat here is tenant healthcare. Big, large for profit system, 50 hospitals in the portfolio. It is also lean into investors, but more as a path to transformation rather than a financial turnaround as it's highly, highly profitable. Fantastic leadership. Operates in really great markets across the country. I believe $6 billion in operating income, nearly 29% operating margin last year. But in 2024, Tenet sold 14 hospitals for nearly $5 billion. Really as it looks to create a more geographically aligned and specially driven portfolio. So that's the nationals. That's what's going on in the national footprint. Just a quick little breakdown of what we're seeing on the regional health system footprint. Or Orlando Health for example, recently made a huge step into Alabama with its $900 million acquisition of tenants majority stake in Brockwood Baptist Health. It's a five hospital system in Alabama. Orlando Health, of course, located and headquartered in Florida. We're seeing some more traction in terms of mergers and acquisitions in the upper Midwest. Recently, Sanford had merged with Marshfield Clinic from Wisconsin, creating a big 56 hospital integrated nonprofit. We look to the Northeast. We've also seen some consolidation there. Northwell Health, headquartered in New York, merged with Nuvance Health from Connecticut. That's created a $23 billion, 28 hospital nonprofit system as well. Just a couple of deals to kind of highlight that trend there, Grace. So a ton of action, a ton of diverging M and A strategies in terms of what national health systems and regional health systems are doing and then some key, key health care policies, really. Hospital leaders across the country will be keeping a close eye on as the clock ticks for September 30th with the potential government shutdown there.
[06:39]
A
Wonderful. Well, Alan, thank you so much for taking the time to join me today and to share these two very important topics with our audience.
[06:47]
B
My pleasure. Thanks so much, Grace.