Literature Review

VITAS touts significant Q3 success, projects future growth McKnights Home Care; by Adam Healy; 10/31/24 VITAS, the home care and hospice subsidiary of Chemed, achieved robust financial results in the third quarter of 2024 and is poised for continued growth, company leadership said Wednesday during an earnings-related conference call. “We are excited about the continued strong results of VITAS,” Kevin McNamara, president and chief executive officer of Chemed, said, according to a transcript. “We are very bullish on the prospects for VITAS for the remainder of 2024 and beyond.” In the quarter ended Sept. 31, VITAS generated $53.4 million in profits, a 20.6% increase compared with the prior year quarter. Revenues rose 17.2% to $391.4 million. Chemed as a whole produced $75.7 million in net profit, a 1% increase year-over-year, behind revenues that increased nearly 7.4% to $606.1 million, according to an earnings report.

BrightSpring CEO: Home health, hospice acquisitions offer ‘high return on investment’ Home Health Care News; by Audrie Martin; 11/1/24 The newest home-based care face on the public market, BrightSpring Health Services (Nasdaq: BTSG), is making strides. The company announced a successful third quarter during its earnings call Friday. Leaders reported an overall increase in business and raised 2024 revenue and adjusted EBITDA guidance. Provider service segment revenue grew across service lines for the Louisville, Kentucky-based company. This was primarily attributed to billable hours growth and its Rehab in Motion program supporting Medicare Part B outpatient rehab patients. ... “From an acquisition strategy perspective, I think it’s going to be consistent with what we’ve done over the past couple of years,” he said. “On the provider side, it’s been rehab, home health and hospice, and then home-based primary care as well. We currently have three or four very small tuck-ins for home health and hospice, which are high returns on investment. On the de novo side, it’s really on home health, hospice and rehab.”

Covenant Care deal a growth engine for Vitas Hospice News; by Jim Parker; 10/30/24 VITAS Healthcare’s acquisition of Covenant Health and Community Services hospice business has emerged as a growth engine for the company. In April, VITAS acquired Covenant’s hospice operations as well as one assisted living facility in an $85 million deal. The transaction brought VITAS into the Alabama market and expanded its geographic footprint in Florida and marked the company’s entry into the assisted living space. Covenant Health contributed close to $11 million to VITAS’ $391.4 million third quarter revenue, which is up 17.3% year over year. In addition to the acquisition, the company in Q3 saw an 15.5% increase in average daily census (ADC) reaching 21,785. Admissions also rose 6.3% to 16,775.

UnitedHealth Group, Amedisys to meet with Justice Department to push for acquisition’s closure Hospice News; by Jim Parker; 10/26/24 Executives from UnitedHealth Group and Amedisys reportedly will meet with U.S. Justice Department officials in an effort to seal their pending deal. Amedisys has indicated that it expects the deal to close in Q4. However, the Justice Department (DOJ) has been making inquiries into the transaction and reportedly has been considering a lawsuit to block it, due to potential antitrust concerns. To date, neither Amedisys nor UnitedHealth Group have been accused of any wrongdoing. Bloomberg first reported on the DOJ meeting, which might begin on Monday, according to sources “familiar with the matter.” The meeting will include Jonathan Kanter, assistant attorney general for the DOJ’s Antitrust Division, Bloomberg reported.

New FTC regulations could create obstacles for hospice M&A Hospice News; by Jim Parker; 10/24/24 Changes to federal rules governing mergers and acquisitions could have sweeping effects on hospice and other health care transactions. The Federal Trade Commission (FTC) recently finalized a rule that will implement changes to required pre-merger notification forms. Pursuant to the Hart-Scott-Rodino Act, parties to certain transactions must submit these documents to the FTC and other regulatory agencies to help identify and address potential antitrust concerns. The law requires that transactions exceeding $120 million must submit the form, which agencies will use to conduct a 30-day premerger assessment, according to Luke Smith, member at the law firm Bass, Berry and Sims. The final rule will likely complicate the closing of some hospice acquisitions.

Martis Capital rumored to purchase Three Oaks Hospice’s in $150m deal Hospice News; by Holly Vossel; 10/18/24 The private equity firm Martis Capital may soon acquire Dallas-based Three Oaks Hospice for a price tag ranging from $150 million to $160 million. Rumors of the potential sale appeared today in an Axios report, in which unnamed sources reportedly confirmed the deal. The Nashville-based investment and management company Petra Capital currently owns Three Oaks Hospice, which reportedly generates between $10 and $13 million in EBITDA, Axios indicated. Rumors that the hospice was considering a potential sale were first reported last month by the website Ion Analytics. The private-equity backed company provides hospice, palliative care and bereavement services across 28 locations in seven states. 

Researchers raise concerns about the financial sector's rising role in US illness care Medical Xpress; by Mary Ann Liebert, Inc; 10/16/24 The authors of a new article in Journal of Palliative Medicine state that the "growing role of the financial sector in home health and hospice, a reflection of larger trends in U.S. health care, is concerning and has major implications for care quality unless reforms are undertaken." Co-authors Lauren Hunt, Ph.D., RN, FN, with the University of California, San Francisco, and R. Sean Morrison, MD, with the Icahn School of Medicine at Mount Sinai in New York, observe that home health and hospice began as nonprofit organizations with close ties to their communities. However, the overwhelming majority are now for-profit entities, many of which have become targets for private equity buyouts. The authors note that "big business's emphasis on maximizing profit can be at odds with patient welfare. Indeed, a substantial body of evidence now demonstrates that care quality is consistently worse in for-profits as compared to nonprofits," they state. The authors further express concern that "pressure to achieve high returns on very short-term time horizons may conflict with the need for longer-term investments in quality, training, and staffing, thus reducing care quality.

Optum’s home-based care arm propelling growth at UnitedHealth Group Hospice News; by Jim Parker; 10/15/24 UnitedHealth Group’s subsidiary OptumHealth is a growth engine for the massive health care and insurance company. In addition to other services OptumHealth holds a substantial home health and hospice business. Optum is in the process of acquiring the home health and hospice provider Amedisys (NASDAQ: AMED), with closing expected before the end of the year, pending some regulatory hurdles. Optum last June penned its agreement to acquire Amedisys in an all-cash transaction of $101 per share, or about $3.3 billion. The Amedisys deal is among a slew of large acquisitions by Optum, which include the home health and hospice provider LHC Group and the health care tech company Change Healthcare. Optum closed its $5.4 billion acquisition of LHC Group in February 2023. 

Private equity’s role in US healthcare remains unchecked after California veto The Guardian; by Jessica Glenza; 10/7/24 Hopes to rein in private equity investment in healthcare died in California last weekend, as a nationally watched bill was vetoed by the Democratic governor, Gavin Newsom. The bill was the nation’s most high-profile legislative effort to regulate such investments in healthcare, and would have given the state attorney general discretion to deny mergers.Its demise comes amid US Senate hearings over mismanagement at Steward Health, a chain of more than 30 private equity-backed hospitals in Massachusetts whose CEO and investors siphoned “hundreds of millions” of dollars from community hospitals even as they developed one of the worst patient care records in the country. 

Vitas Healthcare introduces premier hospice care in Bakersfield and Fresno GlobeNewswire; by Vitas Healthcare; 10/1/24 To meet the growing need for quality end-of-life care in California’s Central Valley, Vitas Healthcare hospice services are now available for residents of Bakersfield and Fresno. With local interdisciplinary teams based in each city, Vitas now offers expert clinical, emotional and spiritual care for seriously ill patients in their homes, nursing homes, assisted living communities and inpatient care settings. 

Hospital mergers and health care price increases: A primer for reporters Association of Health Care Journalists (AHCG); by AHCG Staff; 9/24/24 Hospital mergers — market consolidation — can lead to health care price increases of anywhere from 3% to 65%, according to a 2022 RAND Corporation review. The FTC’s director of the Bureau of Economics has said hospitals that merge may charge 40% to 50% more than if they hadn’t merged. Mergers can also result in layoffs and lower tax revenues and have a negative impact on patient care by reducing access to some health care services. With so much research confirming negative effects and as health care prices continue to rise, what — if anything — can be done to slow market consolidation and/or reduce the harms to patients and local economies?

Gentiva leaning into staff development, advanced illness management business Hospice News; by Jim Parker; 9/23/24 Gentiva in 2024 and 2025 is laser-focused on staff retention and building out its palliative care platform Empatia. ... Gentiva, among other initiatives, is investing in staff education to help develop clearer career paths, stave off burnout and boost retention, according to Chief Clinical Officer Jacqueline Lopez-Devine. “Education is very, very important to the concept of staff retention — taking newer staff that walk into the industry. We have thoughtful training programs that teach them even the concept of work-life balance, professional balance,” Lopez-Devine told Hospice News. “It’s really important that, as organizations, we teach our team members those concepts of joy in work, taking care of self and professional boundaries. That’s what’s going to make us different in some of these other health care industries that maybe don’t take the time.” ... Gentiva is a portfolio company of the private equity firm Clayton, Dubilier & Rice (CDR). The Atlanta-based provider emerged from the former hospice and personal care segments of Kindred at Home. CDR in 2022 purchased a 60% stake from the insurance mammoth Humana, Inc., for $2.8 billion. The firm later rebranded the hospice provider as Gentiva.