HCA Capitalizing on Growing Demand for Hospice, Home Care

Hospital system HCA Healthcare (NYSE: HCA) has recognized the growing demand for home-based health care services and associated growth opportunities. This formed the impetus for the company’s purchase of an 80% stake in Brookdale Senior Living’s (NYSE: BKD) home health and hospice business for $400 million earlier this year. 

Bringing care to the home is a trend that began in earnest long before the COVID-19 pandemic, but the pace has accelerated — a boon for both patients and providers. A side effect of public anxiety about entering hospitals and facility-based care settings is that more care is moving towards the home. 

“[Brookdale home health and hospice] provides us with a large platform that complements our local provider systems,” said HCA Healthcare CEO Samuel Hazen during an earnings call. “Additionally, we believe the home will become a more important setting for health care in the future, with continuing growth in demand.”


The Brookdale transaction is expected to close in the third quarter of this year. The deal expands HCA’s service offerings across its patient networks and could lead to improved care coordination according to Hazen. Brookdale will retain a 20% interest in the segment. Following the transaction’s closing, Brookdale will consider their stake as an equity investment and will no longer report earnings on home health or hospice.

Brookdale is not alone among large players in the industry seeking to take advantage of record-high valuations for hospice assets. Late last year, home health and hospice provider Encompass Health (NYSE: EHC) announced that it also was considering a spin off or sale for its hospice and home health operations.

Nashville-based HCA Healthcare operates 185 hospitals, surgery centers, freestanding emergency rooms, urgent care centers, and physician clinics in 20 states and the United Kingdom, more than 2,000 sites of care all told. This opens up a substantial network that stands to boost hospice census and referrals for their newly acquired business.


HCA sees about 32 million patient encounters annually and a solid proportion will need home health and hospice care. The system’s hospitals discharge about 250,000 patients annually into home-based care. 

The company’s first quarter 2021 revenues reached $13.97 billion, up from $12.86 billion in the prior year’s quarter. First quarter adjusted EBITDA for HCA totaled $3.02 billion.

Hazen indicated that HCA Healthcare would consider future home health and hospice acquisitions as well as building out its traditional business lines. 

“We believe home care provides multiple channels of value for us,” CEO said. “Some of this is in better case management and discharge planning, and some of it is staying connected to the patient when they repurchase health care. We are fortunate to have a balance sheet that can take advantage of those opportunities as presented.”

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