Choice Homecare of Texas, LLC has purchased Nextgen Hospice for an undisclosed sum. Nextgen will rebrand under the Choice name.
Choice Homecare provides hospice, rehab services and home health care in more than 100 counties throughout Texas. The post-acute provider has been on a growth trajectory for a number of years both due to acquisitions and same-store growth.
This expansion marks the company’s entry into the Houston hospice market, where it already has home health and rehab operations.
“Our home health and rehab service lines — some of the client facilities that we serve through our rehabilitation staffing company — they’ve expanded significantly in Harris County. We’ve seen excellent growth in our Houston-based home health agencies, and specifically at this time we are really excited about the 35 employees that were with NextGen in the nursing and CNA sector of the business,” David Jackson, president and CEO of Choice, told Hospice News. “The staff and what they had built there was very attractive and gave us that component of care. Before we acquired Nextgen, we did not have the capability to provide hospice services in Houston.”
This is the latest in a string of transactions growing the Choice footprint. The company in April 2019 acquired Legacy Hospice, also in Texas, for an undisclosed amount. In the following month Choice purchased two home health agencies from Dallas-based CP Holdings. The company entered the hospice space in 2018 with the purchase of Charis Hospice in the Dallas-Fort Worth region.
Choice expects to complete two additional acquisitions during the second quarter of this year, with a third in its pipeline for Q3, according to Jackson.
“All in all, effectively $20 million in acquisitions are planned over the next two quarters,” Jackson said.
Demographic tailwinds have been fueling a thriving hospice market in Texas. The Lone Star State has the third largest elderly population in the nation, according to the Texas Demographic Center, a state institution. The number of Texans 65 or older grew by 49.5% between 2000 and 2014. Only California experienced a higher rate of increase among their senior population.
Texas ranks 13th among the states in hospice utilization, with 52.1% of Medicare decedents electing hospice in 2018, according to the National Hospice & Palliative Care Organization. Utah has the highest rate of utilization at 59.4%.