LHC Group (NASDAQ: LHCG) is leveraging its separate business lines to create a health care ecosystem focused on developing long-term relationships with patients and families. The company providers hospice, home health and home- and community-based services nationwide.
A cornerstone of this effort is LHC Group’s strategy of co-locating its home health and hospice businesses in the same markets, creating a continuum of care that often works in concert with the company’s hospital joint venture partners.
LHC Group has more than 400 hospital and health system joint venture partnerships and recently entered into recent ventures with Orlando Health throughout Central Florida, with University Health System in both Georgia and South Carolina, and then with Northeast Georgia Health System in Gainesville.
“We’re really trying to create a health care ecosystem within the home environment. It’s like a health system in the home as opposed to a health system within four walls, and it’s that whole longitudinal relationship with the patient,” Myers said at the Jeffries Virtual London Healthcare Conference.
With multiple service lines available in a single market, the company can follow patients as they progress through the health care system, often beginning with home health. The patient may need home- and community-based services along the way, and ultimately may need hospice care, Myers explained.
Key to the strategy is bringing more patients and families under their wings. Thus, the company is also taking steps to promote same-store, organic growth by boosting admissions.
Same-store admissions has risen in both their hospice and home health business lines through 2020 despite COVID-19 headwinds. Organic hospice growth rose 12.8% during the third quarter from the prior year’s period, and 4.3% sequentially from Q2. They saw a similar rise in their home health business, which was up 4.7% year-over-year and 11.6% from the second quarter.
The company has remained bullish on expansion into the hospice space in recent years, with acquisitions as a key component of those plans. The company has completed numerous acquisitions during 2019 and 2020 alone.
During October and November alone the company acquired five hospice companies, including Santa Rita Hospice in Colorado, Grace Hospice in Oklahoma, and East Valley Hospice and East Valley Palliative Care in Arizona. The company also acquired Santa Rosa Hospice in Texas with its joint venture partner CHRISTUS Health.
Statements from the company’s leaders suggest that more transactions are on the way in the fourth quarter and into next year both in home health and hospice.
“The phone has been ringing more over the past two months. There was a little bit of a lull during the outset of the pandemic, but we’ve seen some pickup and momentum,” LHC Group President Joshua Proffitt said at the conference. “The market consolidation in general in both home health and hospice in this country is really at that place where in the next three to five years we’re going to see more acquisitive growth than we’ve seen over the past several years, just because of all the market dynamics employed.”