VITAS Healthcare’s acquisition of Covenant Health and Community Services hospice business has emerged as a growth engine for the company.

In April, VITAS acquired Covenant’s hospice operations as well as one assisted living facility in an $85 million deal. The transaction brought VITAS into the Alabama market and expanded its geographic footprint in Florida and marked the company’s entry into the assisted living space.

Covenant Health contributed close to $11 million to VITAS’ $391.4 million third quarter revenue, which is up 17.3% year over year. In addition to the acquisition, the company in Q3 saw an 15.5% increase in average daily census (ADC) reaching 21,785. Admissions also rose 6.3% to 16,775.

During the prior quarter, Covenant brought in an estimated $8.2 million to $8.7 million of revenue, according to Chemed CFO Michael Witzemant.

VITAS is a subsidiary of Chemed Corp. (NYSE: CHE).

“We have now generated nine quarters of sequential net growth in licensed health care workers and eight quarters of sequential growth in ADC. We have also demonstrated the ability and interest in partnering with other providers through acquisitions to ensure communities continue to receive the best possible patient care,” VITAS Chairman and CEO Nick Westfall said in an earnings call. “We are extremely optimistic about the ability of VITAS to maintain an above average historical growth, both organically and through potential acquisitions over the next few years.”

Covenant was VITAS’ first deal in several years, but more are likely on the way, Westfall indicated.

Covenant Health and Community Services Inc., d/b/a/ Covenant Care, provided hospice across six cities in the panhandle and northwest region of Florida and in three markets across southeast Alabama. The former nonprofit also operates a 32-bed assisted living facility in Pensacola, Florida.

VITAS also recently opened a de novo in Pasco County, Florida.

The company did not sustain any “significant property loss or damage” as a result of Hurricane Helene, but the massive storm did cause a slow down in admissions.

“We estimate that admissions were negatively impacted during the quarter by approximately 60 to 100 patients,” Chemed CEO Kevin McNamara said in the earnings call. “We also believe that the Florida admission impact will be more significant in the fourth quarter with a combination of Hurricanes Helene and Milton.”