Kindred Healthcare has made a name for itself in the home health sector, but now the healthcare company is looking to expand in the behavioral healthcare space. On June 1, Kindred announced the acquisition of two behavioral health hospitals, WellBridge Greater Dallas and WellBridge Fort Worth from WellBridge Healthcare. Each hospital has 48 licensed beds.
The acquisition of the two facilities is part of an effort to boost the Kindred Behavioral Health (KBH) brand, Kindred Healthcare’s behavioral health services division. It plans to grow its behavioral health footprint across the U.S. through joint ventures and distinct part unity management with leading hospital systems, in addition to acquisitions. This transaction is expected to close in the summer of 2020. No financial terms were disclosed.
Additionally, on June 11, Kindred Healthcare announced it recently reached an agreement with Riverside Healthcare to operate Riverside Medical Center’s behavioral medicine program, providing inpatient and outpatient care to adults, adolescents, pediatrics, and geriatrics. The agreement builds on Kindred’s existing partnership with Riverside, through which Kindred Rehabilitation Services has managed an acute rehabilitation unit at Riverside Medical Center for eight years.
Kindred Healthcare was purchased in 2017 for $4.1 billion by a consortium of 3 companies: Humana Inc (NYSE: HUM).; TPG Capital; and Welsh, Carson, Anderson & Stowe. Under the terms of the deal, Kindred’s home health, hospice and community care businesses were separated from Kindred and operated as a stand-alone company owned 40% by Humana and 60% by TPG and WCAS. The LTAC hospitals, IRFs and contract rehabilitation services businesses became a separate specialty hospital company owned by TPG and WCAS called Kindred Healthcare.
Shortly before Kindred was purchased, the company sold its skilled nursing business in June 2017 to BM Eagle Holdings, a joint venture led by BlueMountain Capital Management, LLC, for $700 million.
However, according to our Deal Search Online database, Kindred Healthcare hasn’t been an active buyer in healthcare M&A since it was purchased and is focusing on partnerships and new development projects instead. The last deal Kindred Healthcare announced was back in February 2019 when it bought Promise Hospital of East Los Angeles for $20 million.
One of Kindred Healthcare’s wholly owned subsidiaries, Lacuna Health, announced a deal shortly around the same time, in January 2019. Lacuna, a nurse-led clinical engagement company, purchased American Chronic Care, LLC for an undisclosed price. American Chronic Care provides chronic care management services to physician groups, accountable care organizations, and federally qualified health centers.
This deal added not only chronic care management services to Lacuna and Kindred’s platform, but it gave them access to Centers for Medicare & Medicaid Services sponsored programs including transitional care management and remote patient monitoring.
Since Kindred was taken private, it appears to be growing in a very measured way. Behavioral health, however, is very different from the company’s traditional business of healing the body, rather than healing the mind. But this sector could use some corporate professionalism in the mix, especially with a new dedicated unit to grow the business.
