Yes, private equity is a consolidator, but there are many other reasons why private healthcare services is set to change dramatically.

Talking to the CEO of a small French regional lab group shows why. Firstly he expects the state payor to gradually retreat and already sees the rises of national mutuals offering supplementary insurance. “These mutuals are all merging and forming billion euro payors who do not want to deal with small groups. They only want to work with national groups.”

After the merger between Harmonie Mutuelle and MGEN, and Mutuelle Générale and Malakoff Médéric; the latest regrouping is to include Adrea Mutuelle, Apréva Mutuelle, Eovi MCD Mutuelle and Solimut, which will be worth over €2bn in revenues.

Meanwhile, he says that links are growing between the largest players in each sub-sector.  What do care homes have to do with lab groups?  The answer is that their residents take a lot of tests. Which is why Orpea, one of the largest nursing home groups, has signed an agreement with Labco, the largest French lab chain.

So consolidation is not driven just by investors, but by what is happening with payors and the way in which the different sub-sectors in healthcare are beginning to join up.