The Home Health & Hospice (HH&H) market experienced a decline in deal activity, totaling 95 transactions, compared to the 113 announced in 2022. The deals were evenly distributed throughout the year, with 47 deals announced in the first half of 2023, and 48 deals announced in the second half. However, the larger transactions were announced at the start of the year, with approximately $4.7 billion in announced spending during the first half, and only $32 million announced during the second half, when there were much smaller deals and only one disclosed price. While large buyers dominated the start of the year, smaller buyers took the lead in the latter half.
Here are the top five HH&H transactions of the year:
1.) UnitedHealth Group’s subsidiary Optum acquired Amedisys, one of the largest home health and hospice operators nationwide, for $3.7 billion in June 2023. Initially, Option Care Health agreed to acquire the provider in the hopes that it could create an “end-to-end” continuum in the home. Ultimately, UnitedHealth Group’s Optum won out in the end, luring Amedisys away with an all-cash deal. This acquisition marked one of the most significant transactions in the HH&H industry in terms of valuation and buyer trends. If the deal closes, it will position UnitedHealth to become one of the largest home health and hospice operators in the United States. However, in August 2023, the Department of Justice asked Amedisys for more information, and there is yet to be a timetable for when the deal will be completed.
2.) Optum also closed on its acquisition of Lafayette, Louisiana-based LHC Group for $6 billion in February 2023. LHC Group has a national presence, with its 30,000 employees deliver home health, hospice, home- and community-based services and facility-based care in 37 states and the District of Columbia, reaching 60 percent of the U.S. population aged 65 and older. This acquisition continues the trend of payers venturing into home and community-based care.
3.) CenterWell Home Health (formerly Kindred at Home), a subsidiary of Humana, announced that it would acquire Trilogy Home Health for an undisclosed price in April 2023. Based in West Palm Beach, Trilogy provides home health care, personal care and care coordination services from 11 locations across the state of Florida. The Trilogy acquisition expanded CenterWell Home Health’s density in Florida, a state it already had significant density in.
4.) Gentiva, a portfolio company of private equity firm Clayton, Dubilier & Rice (CDR), announced in February 2023 the acquisition of ProMedica’s Heartland hospice and home-based care assets. This marked Gentiva’s first acquisition since it emerged from Humana’s $2.8 billion divestiture of 60% of Kindred at Home’s hospice and personal care business to CDR in April 2022. With a purchase price of $710 million, this transaction was among 2023’s largest HH&H deals in terms of valuation and size.
5.) Addus HomeCare announced its acquisition of Tennessee Quality Care for $106 million in June 2023. The Tennessee-based home health, hospice and private duty nursing provider covers more than half of that state’s 95 counties and is anticipated to generate nearly $40 million in annual revenue, Addus CEO Dirk Allison said in the announcement. The transaction also brings Addus into its third state in which it offers three of its services, along with New Mexico and Illinois.
