by: Gustav Brown and Natasha Bunten
As we move into 2025, private equity activity in healthcare—especially in multi-site healthcare providers—remains dynamic and ripe with opportunities. This is especially true for mid-market private equity funds, which outperformed larger healthcare private equity firms in 2024. In fact, fund-raising by these PE firms has increased 40% over the last three years, a trend that shows no sign of abating.
As deal flow remains strong for private equity in healthcare, so does demand for best-in-class talent. The enduring need for quality leadership has only increased as exit strategies pose a challenge to PE firms due to large bid-ask spreads in recent years. Let’s take a closer look at the most salient trends in private equity activity in healthcare and how these market forces affect the demand for key leadership positions, from CEOs to Directors of Revenue Cycle Management.
Strong Deal Flow in Multisite Healthcare
Private equity deal activity in healthcare surged in 2024, with global investment reaching $115 billion—the second-highest level on record. North America led with 65% of the total deal value, fueled by major consolidations in fragmented markets such as veterinary care, dental services, and primary care. These sectors are attractive for their scalability, cost synergies, and recurring revenue models, which private equity firms leverage to generate superior returns.
This trend is expected to accelerate in 2025 as mid-market private equity funds—historically strong performers—remain highly active. Mid-market healthcare private equity funds (i.e., those managing between $500 million and $4 billion) are seeing increased investor interest and fundraising success, creating ample capital for new acquisitions and add-on investments.
Two broader trends can also be seen over the course of the last year: (1) increased investment in biopharma and (2) a shift towards healthcare IT, staffing, and provider services. The massive deals announced by Catalent ($16.5B) and Sanofi ($17.3B) led the pack, but biopharma and medtech attracted strong interest from middle market sponsors as well.
For these middle market PE firms, however, 2024 was the year that witnessed a shift towards healthcare IT, staffing and support services for physicians and nurses. In large part, this appears to be a recognition of the severe shortages providers currently experience in auxiliary and support services. Health care staffing woes are now at their highest, while the ongoing (and increasing) complexity of revenue cycle management also contributes to this interest sponsoring these companies.
Middle market PE firms continued to invest heavily in physician and other provider services. A common strategy in 2024 was the expansion into ancilliary services, such as incorporating radiology services into an orthopedic practice group or providing laboratory testing onsite.
Key Leadership Roles in Demand
As private equity firms deploy capital and seek operational efficiencies in multi-site healthcare businesses, strategic leadership continues to be paramount. This is especially true as maximizing exit value is vital to decreasing the bid-ask gap noted above. Leadership with experience in acquisitions, tuck-ins, or implementing state-of-the-art billing and IT systems are essential plays for private equity firms seeking to maximize value. As a result, the following executive roles will be in high demand to steer growth and navigate complexities, including:
Chief Executive Officer (CEO)
A CEO role in private equity-backed multi-site healthcare businesses requires vision and agility. CEOs must lead consolidation strategies, oversee integration efforts, and drive top-line growth while maintaining service quality and patient satisfaction.
For middle-market portfolio companies, a CEO in 2025 must be equally adept at driving organic growth through operational excellence (particularly in areas like centralized infrastructure and process optimization) while also having the strategic acumen to identify and integrate value-adding acquisitions, especially in adjacent service lines or capabilities. The ideal leader should also possess deep healthcare sector expertise, particularly in navigating the shift toward value-based care models and leveraging new technologies like AI. Familiar attributes—e.g., strong emotional intelligence in order to maintain strong relationships with both clinical staff and private equity sponsors—will remain highly salient as PE sponsors seek to execute on increasingly complex value-creation strategies.
Read about a case study of a successful interim CEO placement at a pharm company here.
Chief Financial Officer (CFO)
Private equity-backed healthcare businesses rely heavily on CFOs with expertise in financial modeling, capital management, and scaling operations. CFOs also play a pivotal role in managing mergers and acquisitions, a key driver of growth in fragmented healthcare markets.
A mid-market healthcare portfolio company CFO in 2025 needs to be skilled at modeling and executing both organic and inorganic growth strategies, with particular expertise in evaluating tuck-in acquisition opportunities and their potential synergies given the increasing reliance on tuck-ins in the healthcare space. They must have strong operational finance capabilities to drive efficiency in areas like revenue cycle management, procurement, and IT systems consolidation, while being able to clearly communicate the ROI of these investments to PE sponsors.
The ideal CFO should also be adept at navigating complex healthcare reimbursement models, particularly as organizations shift toward value-based care, and be able to develop clear metrics and KPIs to track progress against value-creation initiatives.
Chief Operating Officer (COO)
COOs are responsible for optimizing operational performance across geographically dispersed locations. In 2025, COO roles will increasingly demand expertise in digital transformation to streamline processes and enhance patient experiences through technology.
A COO for a mid-market healthcare portfolio company in 2025 must excel at implementing operational efficiency initiatives across multiple locations while maintaining high quality standards, with particular focus on centralizing core functions like billing, IT systems, and procurement without disrupting patient care or clinical workflows. They should have proven experience in post-merger integration, as the role requires seamlessly incorporating tuck-in acquisitions while capturing synergies and standardizing best practices across expanding organizations.
The ideal COO needs to possess strong change management skills to drive adoption of new technologies and processes, while being able to effectively collaborate with clinical leadership to ensure operational improvements align with patient care objectives and value-based care initiatives.
Regional Operations Directors
With private equity firms consolidating healthcare providers, regional operations directors are critical to scaling operations while maintaining consistency. These leaders oversee performance metrics, standardize best practices, and implement efficient staffing models to drive profitability.
A Regional Operations Director at a mid-market healthcare portfolio company in 2025 must excel at balancing standardization of operational processes across multiple sites while maintaining enough flexibility to accommodate local market needs and regulatory requirements, particularly in value-based care environments. They need to be skilled at rapidly integrating newly acquired locations into the broader organization, with expertise in implementing technology solutions, revenue cycle management improvements, and staffing optimization without disrupting patient care. The ideal candidate should have a proven track record of driving operational KPIs while managing relationships with local clinical leadership, as well as experience in executing post-merger integration playbooks to capture synergies from the increasing number of tuck-in acquisitions occurring in the healthcare PE space.
Director of Revenue Cycle Management
The Director of Revenue Cycle Management ensures that billing, collections, and revenue processes are efficient, compliant, and scalable. This role is increasingly strategic as reimbursement models evolve, and companies face heightened scrutiny on payment accuracy and cash flow management.
A Director of Revenue Cycle Management in a PE-backed healthcare company in 2025 should have expertise in leveraging new healthcare IT solutions and artificial intelligence to optimize revenue cycle processes, while maintaining deep knowledge of evolving reimbursement models, particularly as organizations shift toward value-based care arrangements. They should possess strong change management skills to implement standardized processes across multiple locations and newly acquired entities, while being able to quantify and report on the ROI of revenue cycle initiatives to PE sponsors and executive leadership.
The ideal candidate must also excel at building and managing high-performing teams across distributed locations, with the ability to quickly identify and resolve revenue leakage points, optimize working capital through reduced days in A/R, and drive continuous process improvements that can be scaled across a growing organization.
Navigating Talent Challenges in a Competitive Market
While the demand for executive talent is high, finding the right leadership fit for private equity-backed healthcare companies is increasingly competitive. The ideal candidate must possess a balance of sector expertise, operational discipline, and private equity fluency. Additionally, companies will prioritize candidates who can navigate the expected regulatory challenges and cybersecurity threats, both of which are pressing concerns in 2025.
Conclusion
Looking ahead to 2025, the healthcare private equity landscape remains robust, particularly in the mid-market segment, where strong deal flow and operational improvements continue to drive attractive returns. The success of these investments will increasingly depend on securing top-tier leadership talent who can navigate complex value-creation strategies, including tuck-in acquisitions, technological transformation, and the shift toward value-based care models. As the competition for experienced healthcare executives intensifies, private equity firms must focus on identifying leaders who combine deep sector expertise with private equity fluency, while also possessing the change management skills necessary to drive operational excellence across expanding multi-site organizations.
Read more about ECA’s talent solutions for private equity-sponsored healthcare portfolio companies here.
Steven Haug is a Managing Director at ECA Partners. He can be reached at [email protected]. Evan Markgraf is a Senior Director at ECA Partners. He can be reached at [email protected].
