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DispatchHealth and Medically Home — two of the most prominent companies in the hospital-at-home space — recently announced plans to become one organization.
Separately, Medically Home and DispatchHealth have each played significant roles in shifting higher-acuity care away from traditional brick-and-morter hospitals, placing the home at the center of care delivery.
I believe the merger is the result of hospital-at-home becoming a more mainstream segment of health care, and also – if the integration of the companies goes according to plan – will help further propel the home as the site of care for a greater variety of more complex services. It’s an idea I explored when I had the chance to speak with the CEOs of both companies this week.
Drawing from these conversations, I developed predictions on what a combined Medically Home and DispatchHealth might look like, in terms of service offerings.
The merger also opens up a number of potential synergies and opportunities for the combined organization that both DispatchHealth and Medically Home are eager to unlock and leverage.
“We believe that by coming together, we strengthen our ability to deliver the right care, in the right place, at the right time, which is the core of what both organizations do today,” Jennifer Webster, CEO of DispatchHealth, told me. “We feel very strongly that the access, choice, and place of care for patients is exactly what we will be delivering.”
DispatchHealth was once known as an in-home urgent care company. Over the years, the company has expanded to offer a range of health care services to patients in their homes, including hospital-at-home. The company has treated more than 1.2 million people across more than 20 states in the U.S. since its inception.
Meanwhile, Boston-based Medically Home partners with organizations to help them deliver hospital-at-home services, as well as emergency department services in the home. The company coordinates in-home visits, sets up the proper technology and equipment and pulls together all of the necessary resources.
In this week’s exclusive, members-only HHCN+ Update, I share more details from my conversation with Webster, as well as Medically Home CEO Graham Barnes. Both share why merging their companies was an attractive proposition, and what the future has in store. I also offer analysis and key takeaways, including:
- How the deal illustrates the evolution of hospital-at-home on a broader scale
- What high-acuity services in the home could look like when delivered from a combined DispatchHealth and Medically Home
Deal origins and hospital-at-home’s evolution
In 2024, Medically Home and DispatchHealth began discussions about a possible merger.
That same year, the companies hammered out an official letter of intent. This enabled DispatchHealth and Medically Home to move on to the next stage, and begin the due diligence process and then finally sign a definitive agreement to merge.
Prior to the merger, Medically Home had been considering different ways to scale its business.
“Being able to figure out the right process and expand and scale is really a key element to success in the market,” Barnes told me. “We had an ongoing strategic options committee that has been looking at private equity investors, various opportunities for mergers and other deals. That had been ongoing, and then the DispatchHealth opportunity rose to the forefront of other alternatives.”
At their core, both Medically Home and DispatchHealth are trying to answer the same question. How do you deliver high-quality, high-acuity care in the home to complex patients?
“We like to say that we came at it from different ends of the spectrum,” Webster said.
DispatchHealth founder Dr. Mark Prather is a former emergency room doctor, and his experiences led him to create an organization that would lead to ER diversion.
On the other hand, Medically Home’s answer to the same question was to extend inpatient stays to the home.
DispatchHealth first launched in 2013, and Medically Home would launch a few years later in 2016. Both companies, notably, came into existence prior to the increased implementation of the hospital-at-home model.
Historically, hospital-at-home was considered a niche care delivery model in the U.S. This changed in 2020 when the U.S. Centers for Medicare & Medicaid Services (CMS) announced its Acute Hospital Care At Home program.
The CMS waiver program, a COVID-19 relief measure, addressed reimbursement, which is one of the biggest reasons hospital-at-home had been slow to see widespread adoption.
Almost overnight, the hospital-at-home market exploded. Currently, there are 142 health systems in 39 states approved to provide care under the CMS waiver.
Plus, the CMS waiver program isn’t the only option. Some state Medicaid programs reimburse hospital-at-home services.
During this time, other hospital-at-home players, including Inbound Health, Biofourmis and Current Health also cemented their spots in the market. These companies ranged from technology-enabled care delivery models to enablement platforms, displaying the diversity of companies that fall under the hospital-at-home umbrella.
Despite the accelerated growth of hospital-at-home since the Covid-19 pandemic, doubts remain about the future of the program. The Covid-era waiver program has not been permanently enshrined, and while short-term extensions have kept the program going, long-term planning and investment in HaH has been risky given that the fate of the model is uncertain.
The DispatchHealth, Medically Home combination is a strong signal that major players have confidence and are moving ahead with strategies to make hospital-at-home a more prominent, and permanent, feature of how health care is delivered in the United States.
“I think this deal is a vote of confidence that [hospital-at-home] is only going to expand,” Barnes said. “It’s a positive indicator for our clients, and potential clients, that they should commit to these programs.”
The future of high-acuity care at the combined entity
DispatchHealth’s offerings include an Advanced Care program that delivers high-acuity care in the home, and same-day medical care and recovery care.
The company has also entered numerous partnerships over the years, including with a variety of at-home care providers and health systems. Their partners have included Home Instead, Blue Shield of California, Saint Francis Health System, Emory Healthcare. The company also collaborated with Reimagine Care to deliver at-home cancer care.
Medically Home has collaborated with Boston Medical Center, BrightStar Care and Cardinal Health Inc. (NYSE: CAH).
Combined, Medically Home and Dispatch Health will operate in 50 major metropolitan areas and have partnerships with almost 40 health systems.
Barnes explained that it’s tough to pin down just how much market share the combined companies will hold.
“When we look at the potential market, we had over 30 million inpatient admissions last year across all 6,000 hospitals in the U.S.,” he said. “Combined, between DispatchHealth and Medically Home, we’re probably talking about 20,000 admissions annually. It’s still pretty significant and proof that these are not pilot programs. This is how to scale programs and how to deliver a significant census of patient volume, but it’s still a drop in the bucket of the overall [volume of] acute patients admitted into hospitals.”
This points to a huge potential for growth going forward, Barnes said.
Though Barnes and Webster noted that it was too early to specify, when asked to describe what a combined Dispatch Health and Medically Home will look like in practice, the phrase “full continuum of care for acute care in the home” is often employed by leaders at both companies.
For me, this brings to mind a one-stop shop of higher-acuity care in the home setting. I imagine we may see the combined entity offer services like mobile radiology, while continuing to leverage health system and home-based care provider partnerships to create that full continuum of care in the home.
This means that home health and private duty companies would be wise to think about what would make them an attractive partner to this combined Dispatch/Medically Home entity, or a partner to any competitors that may take on this newly combined entity in the fast-growing market of at-home acute care services. Given that BrightStar and Home Instead are among those already involved in partnerships, it appears that having significant scale and a strong technology backbone are among the elements that make a home-based care provider a viable partner.
Ultimately, here’s what Barnes had to say about the company’s future and what to expect.
“You’ll probably see some cross-selling, where we’re now able to offer existing clients a broader range of solutions,” he said. “On the DispatchHealth side, they’ll be able to offer some of the Medically Home capabilities for hospital-at-home solutions, and similarly, for the Medically Home clients, we’ll be offering some of the ED at Home, SNF-at-home, post-discharge solutions that Dispatch has. A high-level goal is to integrate into a single organization with that broad range of capabilities across a common platform.”
The deal is slated to close in the middle of the year.
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