Agape Care CEO: Staffing Shortage a Factor in Hospice M&A

Widespread consolidation continues in the hospice space, but the industry’s staff shortage is having a greater influence on M&A decisions.

Despite a cool down in early 2022, many expect the hospice M&A market to rebound in the second half of the year. Last year saw a record-number of hospice deals, and many of those buyers focused on integrating those assets during the first quarter.

The long-standing hospice and palliative care workforce shortage has worsened substantially during the pandemic. Many in the space see the labor issue as the greatest threat to not only their businesses but to access to care for patients and families.

“I certainly think [staffing] is a consideration when you look at opportunities and could possibly be a cultural indicator as you learn more about how companies deal with turnover, establish operating expectations and strive to retain employees,” Agape Care Group CEO Troy Yarborough told Hospice News. 

South Carolina-headquartered Agape Care is a portfolio company of the private equity firm Ridgemont Equity Partners. During the past two years, the company has expanded to two other states through acquisitions and de novos.

Most recently, Agape Care Group entered North Carolina by acquiring Hospice of the Carolina Foothills for an undisclosed sum. The acquired agency operates in eight counties in its home state and will not rebrand in the near term.

As long as health care labor shortages persist, a hospice’s leadership team and workplace culture can either seal or kill a deal. An organizational culture in which staff feel supported can be a key differentiator for buyers as well as prospective employees.

“What we saw in Hospice of the Carolina Foothills was a strong and tenured team that carries a phenomenal reputation in the market,” Yarborough said. “Those are all factors that help retain and attract talented clinicians and will make Agape Care a better company.”

This recent transaction is Agape’s second of the year. The company in January acquired Lanier Hospice in Georgia for a confidential amount..

Agape first entered Georgia in 2021 with a de novo in the Augusta community, near the South Carolina border. The company followed that up with the acquisitions of Serenity Care, also in June, and Integrity Hospice in July, both in the town of Dublin, Ga.

“Our Agape Care vision is to continue building a premier, high-quality hospice and palliative care organization across the Southeast,” Yarborough told Hospice News. “In order to do that, you have to be very selective on the M&A front. The ability to expand our geography in a contiguous and dense fashion in NC was extremely appealing.”