Home Health and Hospice M&A Activity Holding Steady

With more than 20 deals total, home health and hospice merger-and-acquisition activity held steady in the third quarter of 2018.

This quarter’s M&A action marks the third-consecutive quarter with more than 20 acquisitions, according to newly released data from Norwalk, Connecticut-based market intelligence firm Irving Levin & Associates. So far, 2018 has seen a “much higher” quarterly volume than during most of 2017.

There were 22 deals during the third quarter of 2018, according to the Irving Levin & Associates data. That’s one more deal compared to Q2’s 21 transactions, but one fewer than the first quarter’s 23 acquisitions.


“Consolidation is driving the recent activity in this market, despite reimbursement and regulatory headwinds,” Lisa Phillips, editor of The HealthCare M&A Report, which publishes the data, said in a statement. “As health systems seek to drive down costs, we expect more to turn to home health care and hospice agencies over traditional post-acute settings like skilled nursing facilities or long-term acute care facilities.”

Indeed, the home health and hospice industries are facing regulatory headwinds from multiple directions. The Patient-Driven Groupings Model is attempting to overhaul the home health payment system, while a revived pre-claim review demonstration is threatening added billing oversight for agencies in certain states.

Regulatory obstacles come as both home health and hospice providers also face staffing challenges as demand for services rises.


Continuing a recent trend, home health companies backed by private equity groups were the most active buyers in the third quarter.

AccentCare, Inc., a portfolio company of Oak Hill Capital Partners, acquiring two home health and hospice businesses in Texas is one example of that PE action. Other examples include Bristol Hospice’s deals for Optimal Health Services and the operations of Suncrest Hospice Colorado. Bristol Hospice is a portfolio company of Webster Capital.

AccentCare’s acquisition of Accolade Home Care and Hospice marked its sixth acquisition in Texas since 2017.

Private equity firms or their portfolio companies accounted for 13 of the 22 acquisitions during the third quarter of 2018, according to the Irving Levin & Associates data. Four publicly traded companies made acquisitions, including Baton Rouge, Louisiana-based Amedisys, Inc. (Nasdaq: AMED).

Citing concerns over quality of care, some skeptics have raised concern over the robust PE interest.

Only two of the 22 transactions in this year’s third quarter disclosed a price, totaling just $1.525 million in dollar volume.

Written by Robert Holly

Companies featured in this article: