Private Equity Shake-up: Are You Ready for Health Care's New Reality?

IMC Board
Feb 18
7 min read

If you think private equity is just a Wall Street story, think again. Private equity investors are quietly rewriting the rules of health care delivery, putting insurance carriers, agents, and digital marketers directly in the line of fire.

Key Takeaways:

Health care private equity deal volume rose nearly 10% in 2025, and 2026 is shaping up to be an even stronger year as the regulatory landscape stabilizes.
Ambulatory surgery centers, skilled nursing, and specialty pharmacy are the hottest investment targets right now.
Consolidation is shifting network leverage, intensifying prior authorization battles, and reshaping the Medicare Advantage landscape.
AI is a baseline expectation, not a differentiator anymore.

Why Every Insurance Professional Should Be Watching Private Equity Right Now

The numbers tell a compelling story. Health care private equity (PE) deal volume climbed nearly 10% in 2025, with close to 750 transactions announced or closed during the year. Globally, disclosed deal value exceeded an estimated $191 billion. This is a record high, surpassing even the frenzied peak of 2021.

That kind of capital movement has downstream consequences for every stakeholder in the health care ecosystem, from the insurance products you sell to the provider networks your clients depend on.

Understanding where that money is flowing and why can give carriers, agents, and digital marketers a significant strategic edge.

Big Picture: Why 2026 Is Shaping Up as a Breakout Year

The backdrop for health care PE in 2026 is more favorable than it has been in years.

Interest rates are easing, and PE firms are sitting on record levels of what investors call "dry powder" (i.e., capital raised, but not yet deployed). That backlog, combined with a growing cohort of sponsor-owned assets reaching the end of their fund lives, is creating pressure to transact. Analysts at multiple firms, including J.P. Morgan, have issued favorable outlooks for health care and life sciences after several years of sector underperformance.

That said, caution remains warranted. Deal activity slowed noticeably in the fourth quarter of 2025, projected to finish roughly 15% below the same period in 2024, as investors waited for regulatory clarity. Questions around the future of Affordable Care Act (ACA) enhanced premium tax credits, shifting reimbursement models, and heightened state-level scrutiny of PE ownership created hesitation. As clarity emerges through 2026, analysts broadly expect deal volume and value to accelerate.

Hot Sectors: Where PE Capital Is Flowing

Not all health care deals are created equal. Here's where PE investors are concentrating their attention and why it matters for insurance professionals.

Ambulatory Surgery Centers

Ambulatory surgery centers (ASCs) are the crown jewel of health care PE right now. Health systems with strong balance sheets are aggressively moving to acquire and expand ASC networks, driven by favorable reimbursement trends and lower-cost care delivery.

One of 2025's most watched transactions was a proposed $3.9 billion acquisition of a major ASC management company that would add approximately 250 centers to a large nonprofit health system's footprint. For insurance carriers, the continued shift of procedures from hospital outpatient settings to ASCs has direct implications for claims cost management and network strategy.

Skilled Nursing and Specialty Pharmacy

These two sectors posted the most dramatic deal growth in 2025. Skilled nursing deal counts surged 143%, while specialty pharmacy deals rose 138%. Both are riding powerful demographic tailwinds as the U.S. population ages.

Specialty pharmacy, in particular, has become an increasingly attractive sector for providers, insurers, and PE firms alike due to its high-margin revenue profile and recurring patient relationships. For insurance professionals, consolidation in both spaces is likely to affect contracting leverage and cost trends.

Physician Practice Management

Interest in physician practice platforms remains strong, though the mix is shifting. Oncology and musculoskeletal care are expected to lead deal activity in this category through 2026.

AI tools are playing a growing role in making these practices more operationally efficient by compressing labor costs, streamlining clinical documentation, and improving revenue cycle performance. Platforms that can demonstrate AI-enabled efficiency gains are commanding meaningfully higher valuations.

Health Information Technology

Health information technology (health IT) is drawing sustained PE interest, especially businesses built around AI-enabled revenue cycle management, interoperability, and predictive analytics. Among the most active PE subsectors tracked in 2025, health IT led all categories with more than 150 deals.

For digital marketers, this sector represents a rich opportunity: PE-backed health IT platforms are aggressively investing in growth, and they need sophisticated marketing solutions to scale.

Cold Spots: Where PE Is Pulling Back

Understanding what PE investors are avoiding is just as important as knowing where they are leaning in.

Gastroenterology

Gastroenterology experienced the steepest drop among physician practice management deals in 2025. Two factors converged to create caution. First, a major acquirer in the space was preoccupied with a large platform acquisition of its own, the $1.9 billion purchase of a urology management services organization, leaving a gap in buyer activity.

Second and more structurally significant, the rise of Glucagon-like peptide-1 (GLP-1) medications has introduced genuine uncertainty about the long-term volume outlook for gastroenterology practices. Investors are grappling with a fundamental question: what does a gastroenterology practice's revenue trajectory look like in a world where GLP-1 adoption continues to climb?

Until there's more data to answer that question, expect continued hesitation.

Reimbursement-Sensitive and Regulation-Exposed Segments

These segments are seeing PE capital shift away. Investors are increasingly favoring software and services platforms over direct care delivery businesses that carry reimbursement and regulatory risk.

Areas with uncertain Medicaid reimbursement profiles or exposure to ACA exchange enrollment volatility are facing a higher bar.

What This Means for Insurance Carriers

PE consolidation is an active force reshaping the competitive dynamics carriers face every day.

Here are three specific implications worth monitoring:

Network leverage is shifting—As PE-backed platforms consolidate physician practices, ASCs, and specialty pharmacy networks, the contracting leverage balance between payers and providers is evolving. Large, well-capitalized platforms have more negotiating power than independent practices. Carriers should anticipate more structured and assertive contracting conversations.
Medicare Advantage is under concurrent pressure—While PE is building out provider infrastructure, the Medicare Advantage market is simultaneously contracting at the carrier level. Major national insurers pulled back from hundreds of counties in 2026, and per-beneficiary funding dynamics remain complex. PE-backed provider platforms are stepping into this space with value-based care models designed to capture Medicare Advantage dollars, creating both partnership opportunities and competitive dynamics for carriers.
Prior authorization and denials management is intensifying—PE-backed health systems are increasingly hiring specialized revenue cycle management firms to push back harder on insurer denials and prior authorization decisions. This trend is already straining relationships between large health systems and payers, and it is likely to become more pronounced as PE-owned platforms invest in AI-powered claims advocacy tools.

What This Means for Insurance Agents

For agents operating in the Medicare Advantage and employer group markets, the PE wave has a few direct consequences worth understanding.

The consolidation of PE-backed provider platforms can create network disruptions that affect plan choices. When a PE firm acquires a physician group, that group may renegotiate its insurer contracts or move to a different network entirely. Staying ahead of those changes, and proactively communicating them to clients, is a meaningful service differentiator.

The broader Medicare Advantage market contraction also creates fresh opportunity. With major national carriers exiting hundreds of counties and approximately 2.6 million beneficiaries finding themselves in terminated plans for 2026, there's real demand for agents who can navigate the shifting landscape with expertise and empathy. Regional carriers and newer entrants are actively expanding, and members who lose their plans need guidance.

What This Means for Digital Marketers

PE-backed health care organizations are among the most marketing-hungry in the sector. They are under pressure to grow revenue, demonstrate scale, and build brand equity ahead of future transactions or exits.

A few specific opportunities stand out:

AI-enabled platforms need demand generation—Health IT and revenue cycle management businesses backed by PE are scaling fast. They are looking for digital marketing partners who understand complex B2B buyer journeys and can generate qualified pipeline efficiently.
Patient acquisition is a priority at PE-backed practices—Physician groups and ASC networks under PE ownership face explicit growth targets. Digital patient acquisition through paid search, local SEO, content marketing is increasingly core to hitting those targets.
Data and analytics are due-diligence criteria—PE investors are evaluating marketing infrastructure as part of their operational assessments. Organizations with clean, robust marketing data and measurable return on investment are more attractive acquisition targets. This gives digital marketers a seat at the strategic table.

Regulatory Wild Card

One factor that could meaningfully alter the PE health care trajectory in 2026 is regulatory action.

State governments are increasingly passing legislation that requires prior approval or notification for PE acquisitions of health care entities, especially in larger states. Federal scrutiny of physician practice consolidation and cross-market mergers has also intensified. PE firms are responding with more disciplined capital deployment, favoring structures like joint ventures, minority investments, and carve-outs over outright acquisitions in more exposed markets.

For insurance professionals, heightened regulatory oversight of PE ownership is a double-edged development. It may slow some network disruptions and reduce consolidation-driven leverage shifts. But it also introduces uncertainty for PE-backed platforms that are your network partners or vendors, which requires proactive monitoring.

Sources:

Bain & Company: Healthcare Private Equity Market 2025: Resurgence and Record Growth
DLA Piper: Healthcare Private Equity M&A: Divergence in 2025, Convergence Ahead in 2026
Forbes: Humana Bolsters CenterWell Primary Care With Another Deal
Healthcare Dive: Health insurers brace for impact in 2026
Healthcare Finance: Humana's CenterWell adds network of senior primary care centers
Modern Healthcare: What's hot, what's not in healthcare private equity dealmaking
Private Equity Stakeholder Project: Private equity healthcare dealmaking remained steady in 2025
PwC: Health Services: US Deals 2026 Outlook: M&A Trends

Further Thoughts

Insurance carriers, agents, and digital marketers need to closely follow private equity's deepening footprint in health care. Capital is moving, networks are shifting, and the competitive landscape is being redrawn quarter by quarter.

The professionals who'll navigate this environment most successfully are those who understand what PE is buying and why. When you understand the investment thesis behind a PE-backed provider platform or health IT company, you can anticipate how that organization will behave as a partner, competitor, or vendor. That kind of strategic literacy is increasingly the difference between reactive and proactive decision-making.

The deal count will keep rising, and you need to position yourself to benefit from it.