Joint venture partners LHC Group, Inc. (NASDAQ: LHCG) and Capital Region Medical Center (CRMC) have entered an agreement to purchase one hospice agency in Mexico, Mo., as well as two home health agencies, one located in Jefferson City, Mo. Financial terms of the transaction were undisclosed.
The joint venture expects the transaction to close before June 1. LHC Group indicated that it anticipates about $5 million in revenue annually from the venture, and they do not expect it to materially impact its 2019 diluted earnings per share.
SSM Health is a not-for-profit health care system with more than 1,600 employed physicians and 40,000 other employees in four states.
“Both LHC Group and Capital Region Medical Center are focused on growing our service capabilities at these locations, facilitating efficient coordination of care delivery, and seamlessly transitioning patients from the acute to the post-acute setting,” said Keith Myers, LHC Group chairman and CEO.
The three acquired agencies will rebrand as Central Missouri Home Health and Central Missouri Hospice. Combined, they serve 250 patients per day. Post-closing, LHG group will operate 112 hospice locations in 35 states.
“One of the strongest aspects of our value proposition for joint venture partners is our ability to help expand their brand and footprint across their region of influence and in markets they serve,” Josh Proffitt, CFO of LHC Group, told Hospice News. “This acquisition presented an excellent alignment with that strategy, and we see this as a great opportunity to grow our partnership with Capital Region Medical Center.”
CRMC is a 100-bed inpatient hospital that also provides hospice and home health care. LHC Group formed the joint venture with CRMC during 2018. The company currently engages in joint ventures with 350 hospitals nationwide.
LHC Group is poised for further growth in its hospice operations as the company actively pursues additional acquisition opportunities, particularly in markets providing overlap with their home health operations.
“Our goal is to co-locate hospice services in markets where we currently provide home health,.” Proffitt told Hospice News. “Apart from our existing 112 active locations, we have identified an additional 127 markets across the nation where we have a strong home health presence and intend to actively pursue opportunities for co-location of hospice.”