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Sentara Healthcare and Cone Health represent the latest in a series of scuttled merger proposals, but it isn't expected to slow M&A activity, industry observers said.
Sentara and Cone abandoned their plans Wednesday to build a more than $11 billion system spanning North Carolina to Virginia amidst internal opposition as well as criticism from community members and state regulators. Around a dozen proposed mergers between relatively healthy not-for-profit systems haven't closed over the past three years as doctors have protested and regulators have become increasingly wary of consolidation.
"I do think it's reflective of this new attitude toward consolidation in healthcare where more than ever, enforcers are suspicious of systems that are growing and skeptical of the benefits they claim they'll bring," said Ken Field, an attorney with Jones Day who works on healthcare antitrust and competition issues. "It's almost as if we're starting from a position of disapproval as opposed to a position that unless we find something illegal, we should let it go through."