JVs a Major Growth Engine for Hospices in 2024

Moving into 2024, more hospices see joint ventures or similar partnerships to be a major growth engine.

Nearly half of 143 respondents to Hospice News’ 2024 Outlook Survey, conducted with Homecare Homebase, said that joint ventures and partnerships were the growth tactics they planned to pursue the most this year. More than 62% of the survey participants were c-suite leaders, vice presidents or directors.

Collaborations and joint ventures are becoming more common in the hospice space as providers try to reach patients further upstream and diversify service lines. Joint ventures can also ease staffing strains across the care continuum, allowing the partners to pool clinicians to work across a variety of settings.

This trend is unlikely to go away anytime soon, according to Tom Lillis, partner at Stoneridge Strategic Consulting. The consulting company is a division of Stoneridge Partners, home, hospice and behavioral health care mergers and acquisitions firm headquartered in Louisville, Kentucky.

“We’ll continue to see more of these JVs and consolidation in the space …,” Lillis previously told Hospice News. “Overall, there’s a lot more interest in joint ventures for health systems in their home health and hospice assets.”

Historically, partnerships with health systems have been the most prevalent, but hospices today are also building collaborations and JVs with primary care providers, Accountable Care Organizations (ACOs) and other entities.

While these strategies are not new to the hospice space, they are gaining momentum.

For example, JVs have been a long standing cornerstone of LHC Group’s approach to growth. The company last year was acquired by the UnitedHealth Group (NYSE: UNH) subsidiary Optum, but those pre-existing relationships remain in place.

Amediys (NASDAQ: AMED) has also been pursuing a range of joint ventures, largely with health systems. In recent years, much of this activity has come through the company’s innovation arm Contessa Health, which has launched numerous hospital JVs that offer high-acuity home care, palliative care and other services.

Other large for-profits are also engaging partners in a number of joint ventures, including AccentCare.

Case in point, that company established a JV with Houston-based Memorial Hermann Health System last year. The two health care organizations combined their home health and hospice operations in south Texas to form a new entity.

Joining forces allowed the organizations’ to strengthen their combined presence in the state and “greatly expand access” to home health and hospice, according to a statement from AccentCare.

“We’re excited to continue our history of transformative care by partnering with AccentCare,” Teal Holden, senior vice president of ambulatory and post-acute services at Memorial Hermann, said in a press release. “Home-based care is a setting that is becoming increasingly important. By joining with a national and local leader like AccentCare, we will significantly advance our capability to both innovate and optimize care in the home-based care setting.”

Memorial Hermann established a similar relationship with Contessa in 2022.

This approach is also gaining ground among nonprofits. Many are building JVs with other individual providers across the continuum, as well as forming regional collaboratives.

BAYADA Home Health Care, which is operated by a nonprofit entity, is among them, having established multiple JVs within the past five years.

Other nonprofits building JVs include Alivia Care, Gilchrist Hospice and Hosparus Health, among others.

“We’re doing a lot of work with partnerships. Some of these partnerships are about goals that these partners are trying to achieve and workforce shortage issues,” Hosparus Health CEO David Cook told Hospice News last year. “There are things that we need to do to be able to support people with health care, and we’ve got to do it smarter, sometimes coming together in a partnership.”