In the first quarter of this year, home healthcare, hospice and home care companies took a break from a buying binge. But that respite might be short-lived, according to advisory firm Mertz Taggart, which recently released its first quarter mergers and acquisitions update.
The three sectors saw 23 combined transactions from January through March, compared to 52 during the final quarter of 2020. Private equity firms accounted for 18 of those transactions.
Mertz Taggart managing partner Cory Mertz attributed the drop off to “potential buyers finalizing deals executed in the second half of last year.”
Move to home health
While most of the M&A activity last year was in the hospice segment, this year it has shifted to home healthcare. That sector saw the most activity in the first quarter, followed by hospice and home care, respectively. The trend appears to be continuing in the second quarter as well.
So far this month, private equity firm Pharos Capital Group added Houston, Tx-based Providence Home Health to its Charter Health Care Group. Additionally, San Diego, CA-based Mission Healthcare acquired Loma Linda Medical Center Home Health.
Mertz told McKnight’s Home Care Daily there are a variety of reasons why home healthcare will continue to be ripe for acquisitions. He said some companies are still struggling under the weight of the COVID-19 pandemic, as well as the new Patient Driven Grouping Model (PDGM) payment system.
“Those agencies that have not adapted to PDGM, along with its longer revenue cycle, are going to have issues,” said Mertz.
There’s another source of potential trouble for home healthcare firms. Some are on the hook now for the Accelerated and Advanced Payments the Centers for Medicare and Medicaid Services (CMS) began recouping earlier this month. Providers who received COVID-19 relief funds last year must repay CMS in full within 20 months.
Those that struggle to repay the money could be ripe for acquisition, as McKnight’s Home Care Daily reported last month. During a virtual healthcare conference Amedisys (AMED) CEO Paul Kusserow said his firm is on the hunt to acquire home healthcare agencies that might have difficulty paying back CMS.
Private equity on the hunt
Amedisys will likely be competing with private equity firms that are also looking to score more deals. Mertz said some PE firms could be looking to expand their reach into other states, while others could be looking for opportunities to complement businesses they already own.
“If they have a home health presence in a service area, they will want to add a hospice or vice versa,” said Mertz.
Despite the slower first quarter, Mertz thinks M&A activity “is all but guaranteed to pick up throughout the rest of 2021.”
"activity" - Google News
April 21, 2021 at 11:08AM
https://ift.tt/3v87Z0Q
After slow start, M and A activity set to take off for home health: advisory report - Home Care Daily News - McKnight's Senior Living
"activity" - Google News
https://ift.tt/3ddCXMh
https://ift.tt/2WkO13c
Bagikan Berita Ini
Dewalotto dan hanya dewalotto yang bisa memberi anda pengasilan tambahan dengan bermain bersama kami seru cepat dan havefun lohh...
ReplyDeleteADD WA +855 888765575 Terima Kasih admint...:)