Michigan-headquartered Residential Hospice has acquired Comfort Hospice in Missouri and Grace Hospice in Ohio for undisclosed amounts.
Residential is a portfolio company of Graham Healthcare Management, which in turn is a subsidiary of the investment firm Graham Holdings Company (NYSE: GHC). Residential purchased the two hospices from health care company U.S. Medical Management, which offers primary care, home health, and a range of other services.
The transaction marks Residential’s first entry into the Missouri and Ohio markets. U.S. Medical Management will retain its hospice locations outside of St. Louis and Maumee.
“With the addition of Comfort Hospice of St. Louis Missouri and Grace Hospice of Maumee Ohio, we are poised for expansion throughout the Midwest as we continue our mission of making hospice care more accessible to our communities,” Justin DeWitte, CEO of Residential Hospice, said in a statement. “We share a commitment of putting patients and families first, by providing exceptional care focused on optimizing the quality of life, comfort, and dignity of our patients.”
Residential Hospice indicated that it would retain employees at Comfort and Grace, and that the company would offer them enhanced benefits while implementing new operational efficiencies and technology improvements.
Favorable demographics are driving interest among providers in the Missouri and Ohio markets.
The proportion of seniors older than 65 in Missouri’s population is expected to reach 19.1% by 2025, up from 13.5% in 2000 and 13.6% in 2008, according to the U.S. Census Bureau.
Hospice utilization in Missouri reached 50.2% among Medicare decedents in 2018, which is in line with that year’s national average, according to the National Hospice and Palliative Care Organization (NHPCO). Utah leads the nation in utilization at 60.4%.
In Ohio, seniors currently represent 17.5% of the overall population, the Census Bureau reported. The number of adults 60 and older is anticipated to reach 30% by 2030, the Ohio Department of Aging has projected. Hospice utilization hit 56.7% in 2018, the sixth-highest in the nation that year, according to NHPCO.
Residential’s parent company Graham Healthcare Group also owns the home-based care providers Residential Home Health, Allegheny Health Network (AHN) Healthcare@Home, and Mary Free Bed at Home. Combined, these companies employ more than 2,800 staff who serve more than 13,000 patients across seven states.
The company’s backer, Graham Holdings Company, emerged from the family of Philip and Katherine Graham, former owners and publishers of The Washington Post newspaper. The Washington Post Company began investing in businesses outside of news publishing during the late 1940s. In 2012, the company purchased its first hospice provider, Celtic Healthcare.
A year later, the Washington Post Company sold its news assets to Amazon (NASDAQ: AMZN) CEO Jeffrey Bezos and reorganized under the Graham Holdings name. Graham went on to acquire Residential Hospice in 2014.
Celtic and Residental merged in 2016 to form Graham Healthcare Group. In 2018, the holding company formed a new health care investment arm, Graham Healthcare Capital. The firm’s investments range in size from $3 million to $30 million in companies that earn between $5 million and $75 million in annual revenue.
Companies featured in this article:
Allegheny Health Network-Healthcare @ Home, Amazon, Celtic Healthcare, Comfort Hospice, Grace Hospice, Graham Healthcare Capital, Graham Healthcare Group, Graham Holdings Company, Mary Free Bed at Home, Residential Home Health, Residential Hospice, The Washington Post Company, U.S. Capital Management