[UPDATED] Humana, Private Equity Firms to Acquire Hospice Provider Curo for $1.4 Billion

Insurance giant Humana (NYSE: HUM) and two private equity firms—TPG Capital and Welsh, Carson, Anderson & Stowe (WCAS)—have agreed to acquire privately held hospice operator Curo Health Services for about $1.4 billion.

The consortium of acquiring companies is already in the midst of buying the nation’s largest home health provider and second-largest hospice provider, Kindred at Home, as part of a takeover of post-acute care company Kindred Healthcare (NYSE: KND).

Curo is based in Mooresville, North Carolina, about 45 minutes north of Charlotte. The company encompasses 245 locations in 22 states, and the consortium intends to merge it with Kindred at Home once the transactions close. This would create the nation’s largest hospice operator, the consortium announced Monday.


Humana and TPG Capital had not responded to requests for comment as of press time. WCAS declined to comment beyond what was in the press release.

The plan is for the existing Curo executive team to lead the hospice division once Kindred and Curo are unified, a banker with knowledge of the deal told Home Health Care News. David Causby—currently president of Kindred’s home health division—would lead the team focused on home health.

“Curo brings a highly capable management team and a tech-enabled, centralized model for hospice care that presents the opportunity for Humana and its consortium partners to be a leader in managing the continuum of home health, palliative care and hospice in an integrated fashion, creating a positive and differentiated experience for patients and their families – as well as their care providers,” the consortium stated in a press release.


The three companies are seeking to leverage data and analytics to more “seamlessly coordinate” transitions along this continuum of care. Curo was attractive to the consortium in large part because of its capabilities in opening new hospice locations to match up with Kindred at Home markets, the banker told HHCN, adding that there is already some market overlap between Curo and Kindred, but the deal is not expected to have a notable impact on clinician staffing—however, there are more significant opportunities to cut costs through back-office labor reductions.

Humana will have a 40% stake in Curo and intends to fund its portion of the acquisition through cash on hand. Evercore acted as exclusive financial advisor to Humana in the deal, and Jefferies acted as exclusive financial advisor to Curo.

The Curo deal is expected to close during the summer of 2018, after the Kindred at Home deal closes. The Curo transaction is not contingent on the Kindred at Home transaction closing.

Hospice has been a hot segment of the mergers and acquisitions market of late, with large players in Medicare-certified home health and Medicaid-certified at-home personal care seeking to build out their hospice offerings.

Addus HomeCare (Nasdaq: ADUS), ResCare and Encompass Health (NYSE: EHC) are among the providers to be pursuing hospice opportunities. The thinking is that by offering a more complete continuum of care, the providers can better control costs and outcomes for a patient population of older adults. This should make them more attractive partners to managed care systems and payors.

Humana is itself one such payor, being one of the country’s largest Medicare Advantage insurers. The acquisition of Kindred at Home is a play, in part, to have more impact over the management of these beneficiaries. It appears the Curo deal is part of this strategy as well, even though hospice itself is not an allowed benefit under Medicare Advantage.

Even as Humana builds out a stable of post-acute and senior care-focused health providers, rumors have surfaced that the Louisville-based company could be an acquisition target for Bentonville, Arkansas-based retail behemoth Walmart (NYSE: WMT).

Written by Tim Mullaney

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