In 2016, home health company valuations hit impressive new peaks. To determine whether this trend will continue through 2017, Home Health Care News tapped Jim Moskal, Partner and Global Healthcare Practice Leader at Livingstone Partners and Luke James, Chief Strategy Officer at Encompass Home Health and Hospice.
The two industry experts believe high valuations will still remain, at least in the short-term. Mergers occur when home health companies choose to increase size due to value-based care reimbursements. Hospital systems and Medicare Advantage payers often want to partner with home health providers in order to expand geographic reach and provide coverage across a region or state. But, says Jim, “You don’t want to partner with 20 or 30 home health providers – you want to partner with one or a couple.”
Mergers and acquisitions became more commonplace as a result. However, the home health industry is facing regulatory uncertainty surrounding the potential repeal of the Affordable Care Act – which may have an effect on valuations. Click here to read more about Home Health M&As here.