Dollars committed to the healthcare merger, acquisition and takeover market declined 38 percent from $231 billion in 2011 to $143.3 billion in 2012, according to a report from Irving Levin Associates.

Measured by dollars spent, that amount represents the second lowest total in 10 years, with only 2003’s $94.2 billion coming in lower, according to the Norwich, Conn.-based publisher. While there were slightly more deals in the biotechnology, e-health, medical device and pharmaceutical sectors in 2012 than in 2011, there was a 41.6 percent decline in dollars spent on those deals.

Several sectors performed better. The home healthcare sector experienced a 20.7 percent increase in deals and an 1872.1 percent increase in dollars spent on deals from 2011 to 2012. Investment in physician medical groups experienced high growth. Although the number of deals in 2012 fell 37 percent compared with 2011, the dollar value of those deals shot up 845.6 percent, to $4.4 billion, thanks to the $4.2 billion acquisition of HealthCare Partners by DaVita. Similarly, the behavioral care sector experienced a 30.8 increase in deals and a 230.6 percent increase in dollars spent on deals from 2011 to 2012. While there were fewer deals involving physician medical groups in 2012 than in 2011, dollars spent on those deals increased 845.6 percent.

The report attributed shifts in long-term trends to an aging population and the early phases of the Patient Protection and Affordable Care Act’s (PPACA) implementation. “Healthcare mergers and acquisitions will stay strong through 2013 as the services sector particularly looks forward to welcoming many more insured patients once PPACA takes effect on Jan. 1, 2014,” said Lisa E. Philips, editor of Irving Levin Associates’ Health Care M&A Report. “The technology side could make a good comeback as the FDA issued a record number of approvals in 2012 and as those drugs and devices come to market.”

For more information on the report, visit Irving Levin Associates website.