Cornerstone Healthcare, a subsidiary of hospice, home health and senior living company the Pennant Group (NASDAQ: PNTG), has purchased Montana-based Hospice of Missoula for an undisclosed amount, marking the company’s first foray into that state’s market.
Pennant indicated that the company intended to seek out further acquisition opportunities throughout 2020, targeting strategic and underperforming organizations of all sizes.
“We are delighted to announce our entry into Montana through this hospice acquisition,” said Danny Walker, Pennant’s president and CEO said. “We believe health care is a local endeavor, so we are very methodical about entering a new state, ensuring we spend significant time beforehand to better understand its regulatory, clinical and operational nuances. We have carefully looked for the right opportunity to bring our innovative operating model and high-quality hospice care to the residents of the Big Sky State and believe we have found that opportunity with this acquisition.”
More than 13% of Montana’s 1 million residents are older than 65, according to the the U.S. Census Bureau. The bureau expects this number to hit 30% by 2020.
Hospice utilization in the state is low in comparison to other states with 43.4% of Medicare decedents electing hospice during 2018. Utah has the highest utilization at 59.4%. Nationally, utilization for 2018 topped 50%.
“The team at Hospice of Missoula has a reputation for excellent care in the communities they have the pleasure of serving,” said Brent Guerisoli, president of Cornerstone. “We are grateful to be entrusted with this legacy and look forward to continuing and building upon it through the application of Pennant best practices and with the aid of our world-class systems and resources.”
Pennant emerged in 2019 as a hospice, home health and senior living spin-off from The Ensign Group (NASDAQ: ENSG). As part of the spin off, Ensign’s stockholders were given one share of Pennant common stock for every two shares of Ensign common stock they held at the end of the business day on September 20, 2019.
Pennant operates 65 home health and hospice agencies, 51 senior living operations, and mobile diagnostics and lab operations located across 14 states, with 23 of the senior living assets subject to leases with third-party landlords, as well as mobile diagnostic services and clinical laboratory operations. Pennant also manages 28 senior living communities pursuant to a new, long-term triple-net leases with Ensign subsidiaries.