The healthcare industry is once again recalibrating after President Donald Trump revoked a Biden-era executive order aimed at limiting hospital consolidation.

While some health system leaders see the move as a green light for growth and regional alignment, others remain skeptical, warning that systemic challenges — from payer leverage to uneven regulation — still pose roadblocks to meaningful change.

The executive order, a 2021 directive issued under the Biden administration, instructed federal agencies to take a more aggressive stance against consolidation across industries. In healthcare, this meant increased scrutiny of mergers and acquisitions, heightened oversight of hospital consolidation and new rules designed to curb what the administration described as anti-competitive practices by payers and providers.

The repeal may ease regulatory pressure on mergers and affiliations, particularly for smaller or regional deals that do not raise immediate antitrust concerns. However, regulators have emphasized that existing antitrust laws remain in force.

Some health system executives see the repeal as a potential opening for more flexible, locally driven mergers, acquisitions and other strategic affiliations.

Michael Charlton, president and CEO of Atlantic City, N.J.-based AtlantiCare, said the revocation may create a more open environment for transactions.

“Regarding hospital consolidation, the revocation may lead to a more flexible environment where hospitals can explore mergers and acquisitions without the previous constraints of the executive order,” Mr. Charlton said. “This could potentially encourage more consolidation as hospitals seek to optimize their operations and resources.”

Looking ahead, he anticipates increased M&A activity in the market as providers aim to strengthen their positions and navigate the evolving healthcare landscape.

“We will be carefully monitoring the situation and adapting our strategies accordingly to ensure that we remain competitive and can continue to provide high-quality care to our patients,” Mr. Charlton said.

David Banks, president and CEO of Altamonte Springs, Fla.-based AdventHealth, said his health system is also focused on delivering whole-person care — body, mind and spirit — in ways that are convenient and connected for the communities the organization serves.

“Our growth strategy is steady and intentional, guided by strong financial stewardship, so people can get the right care close to home with better access and outcomes,” Mr. Banks said.

As part of that work, he said AdventHealth regularly looks at opportunities through the lens of its mission and values — prioritizing being a good community partner, delivering excellent care and supporting employees.

“While the revocation of the executive order on hospital competition may affect the industry overall, we don’t expect a significant impact at AdventHealth,” Mr. Banks said. “Our approach has always been about thoughtful, incremental growth that puts people and communities first.”

Not all health system leaders are optimistic. Some see persistent challenges that may limit the effect of the repeal or even exacerbate existing inequities.

Chris Van Gorder, president and CEO of San Diego-based Scripps Health, believes regional mergers can be valuable for achieving economies of scale — particularly in response to payer and supplier consolidation — but uneven state and federal enforcement continue to be a barrier.

“While it’s not always true that bigger is better or bigger is more economical, hospital mergers — especially if regional — can help counter the leverage insurance companies, pharmaceutical manufacturers and distributors and others in general industry have been permitted to build over the years,” Mr. Van Gorder said. “It’s also true that it’s easier to develop economies of scale regionally than it is for the multistate hospital systems. That will be important when cost reductions are required in the years to come as a result of the reimbursement reductions coming from the recent passage of the One Big Beautiful Bill Act.”

He added that California’s state regulators have historically applied stricter scrutiny to nonprofit hospital mergers compared to transactions involving government or public institutions — such as academic hospitals and health systems — limiting the potential for change, even with federal policy shifts.

“The California attorney general puts almost impossible requirements on not-for-profit M&A while permitting state and government-owned hospitals to acquire hospitals with little review,” Mr. Van Gorder said. “California has also established the Office of Health Care Affordability with the authority to review these types of transactions. However, it’s not clear whether they will also review government (university) transactions. To date, they have not.”

On the other side of the healthcare field, large, national payers continue to hold far more leverage than smaller, fragmented health systems, according to Mr. Van Gorder.

“The same is true for suppliers and drug companies, who exhibit little desire to help lower the cost of care,” he said. “I’m hopeful over the coming years that these characteristics are recognized and that regulatory requirements are rebalanced so that we can make a dent in the cost of healthcare.”

Radha Savitala, founder and CEO of Tenor Health Foundation, a newly launched hospital turnaround company, is skeptical that the repeal will meaningfully accelerate M&A activity.

“I’m not sure many health systems are willing to commit significant resources to acquisitions right now,” Ms. Savitala said during an upcoming episode of the Becker’s Healthcare Podcast. “Even during the first Trump administration in 2018 and 2019, the FTC cracked down on some acquisitions. They remain mindful of competition.”

She emphasized that regardless of federal policy, concentrated health systems can negatively affect communities through higher costs and reduced competition and access to care.

“Even though this executive order has been revoked, we still need to be cautious, and communities must advocate for themselves,” Ms. Savitala said. “We need hospitals, and we need competition, because not every community member wants to go to a tertiary academic medical center. Long wait times and having to wait five or six months for a primary care appointment simply don’t work anymore. I think regulators will be very alert when it comes to reductions in services within their regions.”

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