After a brief slowdown, hospital consolidation is accelerating again, threatening to give large health systems even more leverage to demand higher prices from employers and working families across the country.
New reporting from WP Intelligence finds that 40 hospital mergers and acquisitions were announced in just the first half of 2026. That’s a sharp reversal from 2025, when deal activity fell to a 15-year low of 46 transactions across the entire year.
For employers already struggling with rising healthcare costs, the resurgence of hospital consolidation should raise alarms. As health systems grow larger and markets become more concentrated, purchasers face fewer choices, weaker negotiating positions and higher prices for care.
Here’s what to know:
Hospital deals are getting bigger— and so is their negotiating power.
Some of the largest health systems are expanding their reach across multiple states and markets.
- Sutter Health and Allina Health are pursuing a merger that would span California, Minnesota, and Wisconsin, bringing together 39 hospitals and more than $26 billion in annual revenue.
- Sanford Health’s newly completed acquisition of North Memorial Health creates a system with 60 hospitals, 310 clinic sites, and 4,950 physicians and advanced practice providers.
- Lifepoint Health’s June acquisition of eight hospitals across six states leaves the combined system with 68 community hospitals, more than 70 rehabilitation and behavioral health hospitals, and more than 300 additional sites of care.
For employers, the concern is not simply that health systems are getting bigger. It’s what greater market power can mean at the negotiating table. As systems expand across hospitals, physician practices, and other sites of care, employers and benefit purchasers can have fewer alternatives when negotiating networks and prices.
Consolidation across geographical markets are more likely to fly under the radar despite their potential to increase prices
Many of these deals involve health systems operating across different geographic markets. Because the hospitals may not directly compete with one another, regulators can have a harder time demonstrating that a merger reduces competition in any single geographic market.
However, research shows that cross-market consolidation can still result in higher prices. A 2024 study examining commercial claims data found that prices were nearly 13% higher six years after cross-market acquisitions took place. Among systems that completed four or more cross-market acquisitions, prices were roughly 16% higher.
And the price effects of hospital consolidation can be even more severe. A federal report found that studies of hospital acquisitions and mergers have documented price increases ranging from 6% to as much as 65%— saddling patients and plan sponsors with bloated costs for the same services
Policymakers are paying attention.
Concern about hospital consolidation is increasingly bipartisan. Joel White, president of the Council for Affordable Health Coverage, testified about consolidation before Congress four times between November and January and told WP Intelligence that he encountered “strong bipartisan concern” about how consolidated healthcare markets have become.
“Every time a dominant health system swallows up a competitor or physician practice, it gains more power, raises prices, and squeezes employers and families,” White said.
Employers have seen this play out before: consolidation gives dominant health systems greater market power, and that power can translate into higher healthcare prices.
Employers and health plan purchasers are doing their part— using data, negotiating with providers, and pursuing innovative purchasing strategies to keep coverage affordable, but they cannot negotiate their way out of increasingly concentrated healthcare markets while competition continues to disappear.
As another wave of hospital consolidation takes hold, policymakers at the state and federal levels should carefully scrutinize potentially anticompetitive transactions, including cross-market consolidation, and consider their impact on those whose who ultimately foot the bill – employers and working families.