Minnesota-headquartered St. Croix Hospice has moved into the state of Michigan with the purchase of CNS Hospice for an undisclosed amount. The Troy, Mich.-based provider serves the Detroit metropolitan area.
St. Croix, a portfolio company of the private equity firm H.I.G. Capital, has been aggressive in pursuing growth during 2020 and 2021. St. Croix opened seven new locations during 2020 and four so far in 2021, including one in Wisconsin last week.
The company is also no stranger to acquisitions. The company moved into Illinois earlier this year with the acquisition of Hospice Care of America. Financial terms of that transaction were not disclosed. In March 2020, St. Croix acquired Serenity Care Hospice in Missouri for an undisclosed sum.
“We’re excited to broaden our ability to serve patients and their families by opening our first location in Michigan,” said Heath Bartness, St. Croix Hospice CEO. “The CNS Hospice team is a welcome addition to the St. Croix Hospice family. They know the community well and are aligned with our agency commitment to offer outstanding care for local patients and families.”
St. Croix looks for symmetries between potential new locations and their existing operations when they enter new markets as they recently did in Michigan and Illinois. They estimate the extent to which they can increase access to the hospice benefit and identify opportunities to establish relationships with new referral partners. The company plans to accelerate its de novo and acquisition activities during 2021, according to CFO Stephen Phenneger.
St. Croix is retaining CNS Hospice’s current staff. The company’s average daily census hit more than 2,200 patients during 2020 from 40 locations in seven states. H.I.G. Capital acquired St. Croix from PE firm the Vistria Group last year in one of 2020’s largest private-equity backed hospice deals. St. Croix operates in Iowa, Illinois, Kansas, Minnesota, Missouri, Nebraska, Michigan and Wisconsin. While looking to continue expanding its footprint, the company is concentrating on the Midwestern region.
“We continue to receive a fair amount of inbound interest with folks looking to partner with a larger player in the space, and we would continue to accelerate our acquisition strategy and our partnership strategy with smaller operators in our markets.,” Phenneger told Hospice News.
Michigan had the 10th highest rate of hospice utilization among Medicare decedents during 2018 at 53.8%, according to the National Hospice & Palliative Care Organization. The national average that year was 50.3%. Utah led the nation with 60.5%.
Companies featured in this article:
CNS Hospice, H.I.G. Capital, Hospice Care of America, Serenity Care Hospice, St. Croix Hospice, The Vistria Group
