Home Health Businesses Acquired by KKR Through $9.9 Billion Envision Deal

Private equity powerhouse KKR has acquired Nashville-based Envision Healthcare Corporation (NYSE: EVHC), one of the largest doctor-staffing companies in the United States with roughly half a dozen in-home care entities under its umbrella.

The $9.9 billion deal, announced Monday, is one of the biggest by a private equity firm in the past couple years, easily placing it among the ranks of JAB’s $7.5 billion play for bakery chain Panera Bread or Sycamore Partners’ $6.9 billion purchase of office supplies giant Staples. The all-cash acquisition, which includes debt, comes exactly one week after KKR sold back half of its stake in Baton Rouge-based home health provider Amedisys, Inc. (Nasdaq: AMED) for about $178 million.

“Envision is a leading provider of physician-led services in a health care system in which physician-patient interactions have a pronounced impact on nearly all health care decisions,” Jim Momtazee, head of KKR’s health care investment team, said in the announcement. “We are excited to partner with the outstanding team … to help build upon the strong foundation in place and accelerate Envision’s growth going forward.”


The result of a 2016 merger with AMSURG Corp., Envision Healthcare offers wide-ranging physician-led, ambulatory and post-actute services to more than 1,800 clinical departments in health care facilities across 45 states and Washington D.C. The company owns and operates 261 surgery centers and one surgical hospital. It also offers in-home care services though its Evolution Health business and several wholly or partly owned subsidiaries, including Ascension Health at Home, Care Connection of Cincinnati, Gem City Home Care, Guardian Healthcare, Millennium Home Care and Valley Health Home Care.

Ascension Health—a national partnership between Ascension and Evolution Health formed in 2014—was the the 33rd-ranked home health agency in terms of market size in 2017, according to the LexisNexis. The partnership between Evolution Health and Ascension Health includes Ascension-affiliated home health, hospice, home infusion therapy and private-duty services.

Evolution Health had about 2 million care encounters in 2016, according to an annual report from the business. Combined, Evolution Health and Ascension Health at Home had a total workforce of about 4,000 people in 2016, about 37% working in Evolution Health operations and 63% in Ascension Health at Home joint venture operations.


Kirk Allen currently serves as Evolution Health’s president. He also serves as president of Ascension Health at Home.

KKR and Envision Healthcare did not respond to Home Health Care News’ requests for comment as of publication.

It is unclear exactly how much of Envision Healthcare’s revenue is derived from its home health operations. More than half of the company’s revenue comes from emergency department and hospitalist services, according to U.S. Securities and Exchange Commission financial filings. Anesthesiology services account for 28% of the Envision Healthcare’s revenue mix, with radiology services and children’s services combine for about 10%. “Office based, surgery and other” make up the remainder, about 8% in total.

Envision Healthcare’s net revenue in 2017 was $7.8 billion, according to financial filings. Despite the high revenue total, it recorded a loss of about $228 million.

KKR’s acquisition of Envision Healthcare follows the recent pattern of private equity investors buying into health care, especially when it comes to in-home care and hospice companies. Throughout the last two years, there have been more than 32 private equity investments into the home health and hospice spaces, according to proprietary data from The Braff Group.

Envision Healthcare has been under fire in recent months after a study conducted at Yale found that hospitals where Envision’s EmCare unit operated appeared to charge more out-of-network bills for at least one insurer. The company had been looking to make a move for the past seven months in order to enhance shareholder value, reaching out to more than two dozen potential buyers before agreeing to terms with KKR.

Written by Robert Holly

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