Leading financial analysts scoffed at the notion of a healthcare IT “bubble” that could slow the pace of mergers and acquisitions this year. Speaking on a panel called “Financing The Deal” at the Nashville Health Care Council, they predicted that 2012 M&A activity would be brisk, though not superheated.

In the health IT sector, there’s currently a glut of buyers and not enough companies to acquire. There are many non-healthcare players like Lockheed-Martin wanting to buy healthcare IT companies – and many suitors for a limited number of clinical decision support companies. “There are still a lot of great opportunities for technology-enabled healthcare companies with a demonstrable ROI,” said David Jahns, managing partner at Galen Partners.

The analysts agreed that deal-making this year won’t be dampened by uncertainty surrounding the future of healthcare reform. If anything, there’s greater pressure to make deals this year in advance of possible post-election efforts at tax reform.

“There’s still a stable financing environment despite the upcoming election and the events in Europe,” said Jon Santemma, global co-head of healthcare investment banking at Jefferies & Company. “Valuations are down in some sectors like nursing homes and home health, which makes them good deal-making opportunities this year. And we anticipate a lot of deals this year involving private-pay companies.”

There’s still about $350 billion in private equity “overhang”, which sets the stage for some rapid-fire M&A this year. “I look for a lot of activity in the mid-market private equity arena, with a lot of possible deals in the $200 million to $800 million range,” added Santemma.

According to Irving Levin & Associates, hospital M&A reached a 10-year high last year, when 86 deals were completed. “I look for hospital transactions to increase,” said Ravi Sachdev, managing director at J.P. Morgan. “The attitude we’re now seeing is, ‘If I can’t be No. 1 or No., 2 in my service area, I want out’.”

Panelists were reluctant to make long-range forecasts. “Five years ago, who would have predicted that you’d have payers acquiring HIEs?” said Jahns. “But that’s exactly what’s happening now.” The panel members agreed that one long-term trend is rock-solid: a lot of money will continue to flow through America’s healthcare system – enough money to allay dealmakers’ concerns about declining state and federal reimbursements.

As for overseas deals, look for increased activity in telemedicine in 2012. China and India have been quick to harness the potential of telemedicine. And as one panelist quipped, “It’s easier for U.S. telemedicine companies to operate in China than across state lines.”