Though the mergers and acquisitions market for home health remains
“The market for home health agencies could very well be on
Braff Group attributes this development to concerns about ongoing Medicare payment reforms, particularly the US Centers for Medicare & Medicaid Services Patient-Driven Groupings Model (PDGM), which becomes effective Jan. 1, 2020.
The Partnership for Quality Home Healthcare has estimated that PDGM could lead to a 6.42% Medicare base rate reduction for home health, amounting to $1 billion in lost revenue for home health providers in 2020 alone.
Health care M&A advisory firm Mertz-Taggart made a similar forecast.
“We expect 2019 will be another active year for M&A. However, most of the growth will come from hospice and private duty home care” according to Mertz-Taggart, who also cited PDGM as a contributing factor.