Private equity is paying increasing attention to the mental and behavioral health space, according to a white paper from Vector Medical Group and Epstein, Becker Green.
The aftermath of the COVID-19 pandemic is the prime mover: PitchBook data shows an avalanche of deal volume in Q4 2020, with a record 22 deals in the space to close out the year. Historically, only a handful of mental and behavioral health deals have been completed each quarter, thus leading to modest annual numbers compared with other healthcare services. This momentum continued into 2021, with at least 11 transactions made in each of the past three quarters. Like other healthcare services, the mental and behavioral segment is highly fragmented and lacks scale. And, also like other healthcare services, those factors set the stage for private equity-guided consolidation—particularly for outpatient services. Read more.
