Dealmaking across healthcare services cooled further in the second quarter of 2026, with physician practice groups taking the brunt of the slowdown while ASCs held up better, according to a new report from PitchBook.
The organization’s “Q2 2026 Healthcare Services Report: Gusting Macroeconomic Headwinds Impede Progress,” published Aug. 14, analyzed private equity activity within the healthcare industry.
Here are eight numbers to know from the report.
- Overall deal count fell 18.5% year-over-year in the second quarter, and total deal value for the first half of 2026 was 7.3% lower than the same period last year, as anticipated interest rate hikes and soft hospital utilization weighed on activity.
- Exits are shrinking too — the number of healthcare services exits is projected to end 2026 down 26.5% from 2025, with exit value down 30.9%.
- ASCs were a bright spot in the industry. Deal activity in the broader “ancillary and outsourced services” category, which includes ASCs, clinical staffing and diagnostic labs, is on pace to finish 2026 only 4.9% below 2025’s full-year count, making it the most resilient segment in the report.
- Physician practice management deals have taken the hardest hit. The second-quarter count of 71 deals is down 35.8% from 111 in the same quarter of 2025, and full-year 2026 volume is on track to fall 46.1% below 2025’s full-year volume. Vision and fertility platforms were two bright spots within the segment.
- A wave of new state oversight is adding friction to physician practice deals. California’s AB 1415, effective Jan. 1, requires at least 90 days’ advance notice and detailed financial and governance disclosures for material healthcare transactions. Rhode Island’s rules, effective Jan. 28, require advance notice for deals involving private equity firms and management services organizations. Hawaii and Pennsylvania have proposed 180-day and 120-day advance-notice requirements, respectively, and Oregon adopted corporate practice of medicine restrictions in January aimed at limiting the “friendly physician” model.
- The quarter’s two largest transactions were an initial public offering and a take-private buyout. KKR’s $3.4 billion initial public offering of Global Medical Response topped the list, followed by Knox Lane’s $416 million take-private leveraged buyout of staffing company Cross Country Healthcare in May.
- Private equity buyers are still paying up for quality assets, even as volume falls. Median entry multiples for 2025 deals hit 13.6 times EV/EBITDA on median entry revenue of $162.5 million and a 20.5% EBITDA margin, up from 13.5 times, $147.1 million and 17.8%, respectively, in 2024.
- The report expects AI to be a long-term tailwind for physician groups. The report describes physician practice management groups as “fundamentally long-term beneficiaries” of the throughput and efficiency gains agentic AI tools could generate, though it cautions that those benefits will take time to show up in returns as operating playbooks adapt.
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