Vistria Group, Large Hospice Companies Invest in Muse Healthcare, Medalogix

Chicago-based private equity firm The Vistria Group has agreed to recapitalize and invest in the growth of the post-acute data analytics and machine learning companies Muse Healthcare and Medalogix. Joining Vistria as minority investors are the home health and hospice providers LHC Group (NASDAQ: LHCG), Amedisys (NASDAQ: AMED), and Encompass Health (NYSE: EHC). The dollar amount of the investment has been kept confidential.

Following this investment, Medalogix and Muse will merge and operate under the Medalogix brand. The combined enterprise will develop machine learning solutions designed to identify patients in need of home health, hospice or palliative care services as early as possible in the course of their illnesses. The company’s platforms also identify patients at high risk of hospitalization or clinical decline and assist in care coordination across the health care continuum.

“Integrating our technology with the Medalogix solution platform allows us to cover the entire care continuum for patients in the home, giving our customers the insights and care guidance to obtain the most appropriate outcomes,” said Tom Maxwell, chairman and co-founder of Muse Healthcare. “Together, we will accelerate the growth of our customers, ensuring they are using data to support every care decision, and appropriately increase the days of care provided in the place where the patient deserves to be: their home.”

The combined company’s platform will engage nearly one-third of all Medicare home health and hospice beneficiaries, including support for more than 325,000 home health patients and 50,000 in hospice.

The Vistria Group is a large investor in the hospice space. Current portfolio companies include hospice providers Mission Healthcare and Agape Care, as well as other health care holdings. Last year, the firm sold Minnesota-headquartered St. Croix Hospice to H.I.G. Capital for an undisclosed sum. St. Croix has a substantial Midwestern footprint that extends across six states.

“The Vistria Group shares our vision of providing the best possible solutions to our customers and impacting change in healthcare by ensuring patients can be cared for in their home,” said Elliott Wood, president and CEO of Medalogix.

Engaging patients earlier in their disease trajectories is a priority for hospice providers. While hospice utilization is rising, lengths of stay for many patients remains too short for them to receive the full benefit of hospice care.

Hospice utilization among Medicare decedents exceeded 50% for the first time in 2018, according to the National Hospice & Palliative Care Organization (NHPCO). More than 27% of patients in 2017, however, were in hospice for seven days or less, with another 12.7% in hospice for less than 14 days, NHPCO reported.

Investor LHC Group expects these expanded machine learning capabilities to foster their continued growth in the hospice space, according to a document the company shared with Hospice News.

Hospice acquisitions are a top strategic focus for LHC Group. Their primary strategy is to build up their hospice footprint in markets where they already have a home health presence. LHC Group has earmarked $502.5 million for acquisitions this year, with 71% of those dollars weighted towards hospice.

“Leveraging leading solutions such as Muse and the Medalogix Bridge, Care, Nurture and Touch solutions — as well as our own proprietary clinical care model — complements other components of our value-based care strategy,” an LHC Group spokesperson said. “These solutions fit in well with our proprietary model that was developed by clinicians using evidenced-based outcomes.” 

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