Home Health Providers to Watch in 2021

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The COVID-19 pandemic delayed the bold plans of most residence well being suppliers. Now practically midway into 2021, many are choosing up proper the place they left off, with a couple of key gamers doubling down on innovation and betting massive on the way forward for home-based care.

There are lots “residence well being suppliers to observe” as the remainder of this 12 months performs out. Initially, Residence Well being Care Information wished to shine a light-weight on simply 5 of them, however that process proved practically unattainable.

The house well being powerhouses on this record are price following for a wide range of causes, whether or not that’s on account of their forthcoming organizational modifications, current industry-shaping acquisitions or attention-grabbing progress methods. Whereas the next firms are very completely different in phrases dimension, companies and possession buildings, they share two key commonalities: a willingness to take probabilities and a dedication to enhancing senior care within the U.S.

Aveanna Healthcare

Aveanna Healthcare Holdings Inc. (Nasdaq: AVAH) has traditionally centered on caring for complicated pediatric sufferers within the residence, nevertheless it not too long ago unveiled plans to take a position extra closely round senior care as a part of its IPO course of.

If it efficiently executes on that mission, it might doubtlessly disrupt the present residence well being market, which is presently dominated by Kindred at Residence, Amedisys Inc. (Nasdaq: AMED), LHC Group Inc. (Nasdaq: LHCG) and a handful of different massive, well-resourced suppliers.

“We consider that we’ve the chance to leverage our nationwide residence well being infrastructure to develop an {industry} main grownup residence well being and hospice enterprise related in dimension and scale to our pediatric residence well being enterprise,” the Atlanta-based Aveanna reported in an S-1 monetary submitting. “We consider this long-term growth technique in grownup finish markets via de novo growth and acquisitions will present Aveanna with a extremely distinctive profile as in comparison with its residence well being friends, with extra diversified reimbursement sources, a decrease danger profile and a broader set of natural and inorganic progress avenues to pursue opportunistically.”

At this time, that “residence well being infrastructure” spans 30 states and practically 250 places. Regardless of predominantly working within the very tough pediatric residence well being house, Aveanna has grown its income from roughly $324.6 million to about $1.5 billion over the previous 5 years, giving it loads of firepower transferring ahead.

Changing into a much bigger senior care residence well being participant seemingly received’t be straightforward for Aveanna, nonetheless.

For starters, caring for seniors may be very completely different than caring for critically in poor health and medically complicated youngsters, each by way of clinician talent units and gear. Moreover, Aveanna management has urged the corporate plans on sustaining its pediatric residence well being enterprise because it concurrently expands into senior care, which might find yourself difficult contemplating the worsening well being care labor crunch.

In April, residence well being employment numbers contracted by about 6,700 jobs, in line with preliminary information from the U.S. Division of Labor. Neighborhood care services for the aged and different residential care services likewise misplaced jobs.

On prime of all that, Aveanna must get well from a considerably rocky market debut. After going public on the finish of April, the corporate’s inventory has but to rise above its preliminary providing value of $12 per share.

But even with these hurdles to beat, the grownup residence well being market gives extra upside and stability than the pediatric house, particularly with the total would possibly of the “silver tsunami” looming.

“Grownup residence well being and hospice are pure extensions of Aveanna’s core residence well being infrastructure,” the S-1 continued. “Particularly, the grownup residence well being enterprise leverages our platform infrastructure and core competencies in scientific program administration, automated and environment friendly nurse recruitment, technology-driven income cycle administration, payer contracting and entry into new geographic markets.”

CenterWell Residence Well being

Haven’t heard of CenterWell Residence Well being earlier than? Nicely, that’s in all probability as a result of it doesn’t exist but.

“CenterWell Residence Well being” is the inheritor obvious of Kindred at Residence, the brand new id for the house well being big as soon as Humana Inc. (NYSE: HUM) features 100% management of the enterprise from non-public fairness sponsors TPG Capital and Welsh, Carson, Anderson & Stowe (WCAS). Humana already owns a 40% stake of Kindred, nevertheless it’s presently within the midst of buying the rest for a cool $5.7 billion.

Whereas Kindred is way from the one home-based care instrument in Humana’s toolbox, it has the potential to be essentially the most impactful. The supplier has places in 40 states, using roughly 43,000 caregivers who ship residence well being, hospice and community-based companies to greater than 550,000 sufferers yearly.

CenterWell Residence Well being is arguably a supplier to observe due to its dimension alone. But it’s what Humana management has mentioned concerning the enterprise because the takeover information broke that makes it so attention-grabbing. 

Gaining a minority stake in Kindred again in 2018 allowed Humana to experiment with Kindred and formulate a plan for shifting companies away from conventional fee-for-service cost fashions. The insurer is assured it has mapped out a path for doing simply that, propelled by its standing as a prime Medicare Benefit group and considered one of simply 53 direct-contracting entities (DCEs).

“Absolutely integrating Kindred at Residence will allow us to extra carefully align incentives to concentrate on enhancing affected person outcomes and lowering the overall value of care,” Humana CEO Bruce Broussard mentioned in the course of the Louisville, Kentucky-based firm’s first-quarter earnings name. “That is crucial to deploying, at scale, a value-based, superior residence well being mannequin that makes it simpler for sufferers and suppliers to profit from our full continuum of home-based capabilities.”

Humana’s takeover of Kindred at Residence is anticipated to shut in the course of the third quarter. As soon as that occurs, Humana will rebrand Kindred to CenterWell whereas offloading its hospice and private care companies operations.

It is going to then speed up CenterWell’s participation in value-based care preparations, intertwining it with in-home pressing care, acute care and first care companies as wanted.

“In some methods, I feel Humana is making an attempt to construct out an Optum-like payer-agnostic mannequin, therefore the rebranding to CenterWell, which they’ll promote to members exterior of their respective MA membership base,” Eugene Goldenberg, a managing director at Edgemont Companions, beforehand instructed HHCN.

CenterWell is positioned to be a boon for Humana, nevertheless it might additionally pave the best way for different residence well being suppliers trying to migrate away from payment for service.

“We’ve acknowledged for a while that the present volume-based, fee-for-service mannequin has restricted the innovation in residence well being,” Broussard famous in the course of the Q1 name.

AccentCare, BrightSpring Well being Companies

AccentCare Inc. and BrightSpring Well being Companies are two extremely diversified in-home care firms which have made loads of headlines over the previous few years. But it’s what would possibly occur within the not-so-distant future that makes them each residence well being suppliers to observe.

Previously referred to as ResCare, BrightSpring is likely one of the largest suppliers of home- and community-based companies (HCBS) within the U.S. The corporate — backed by KKR and an affiliate of Walgreens Boots Alliance — has been more and more energetic within the residence well being house, with its most up-to-date acquisition being Abode Hospice and Residence Well being.

Broadly, Louisville-based BrightSpring has sought to tell apart itself with its “three-legs-of-the-stool” technique centered round residence well being for medical wants, private take care of assist with actions of every day dwelling (ADLs) and pharmacy companies for ongoing remedy administration.

“We actually have a novel platform, and we’re hopeful that it will likely be useful sooner or later,” BrightSpring President and CEO Jon Rousseau instructed HHCN in its 2020 “Changemakers” sequence. “Our platform is centered round providing a number of important companies that we expect are all required to optimally and holistically deal with a person with excessive wants, anyone with important acute and/or continual wants.”

In the meantime, Dallas-based AccentCare — owned by world PE agency Creation Worldwide — was already one of many largest residence well being suppliers within the nation going into 2020. In December of final 12 months, it merged with Seasons Hospice & Palliative Care, making it one of many 5 largest hospice suppliers as properly.

The mixed AccentCare-Seasons enterprise operates over 225 websites of care throughout 26 states, using practically 30,000 employees. It has greater than 60 whole partnerships with well being methods and doctor practices.

AccentCare and BrightSpring are price watching as issues stand right now, however some {industry} insiders have speculated that both might search to go public inside the subsequent 12 to 18 months. Public market multiples are presently via the roof, with the demand for residence well being care solely projected to extend.

Neither AccentCare nor BrightSpring must go public, however the alternative could also be too enticing to go up. For what it’s price, Assist At Residence can be seen as a possible candidate to go public by market consultants.

So far as stacking up towards different publicly traded firms, AccentCare would fall someplace between LHC Group and Embody Well being Corp. (NYSE: EHC) by way of annual revenues.

“Let’s simply say we’ll be quick approaching that basic dimension and breadth,” AccentCare CEO Steve Rodgers instructed HHCN when the Seasons deal was first introduced.

HCA Healthcare, Embody Well being

HCA Healthcare Inc. (NYSE: HCA) and Embody Well being are additionally residence well being suppliers to observe for related causes, although the previous isn’t technically even within the residence well being house but.

In February, HCA revealed that it’s shopping for 80% of Brookdale Senior Dwelling Inc.’s (NYSE: BKD) residence well being and hospice phase for $400 million. Throughout its footprint, the Nashville, Tennessee-based HCA Healthcare runs greater than 180 hospitals and a couple of,000 websites of care, nevertheless it presently doesn’t have a house well being presence.

A pair months earlier, Embody Well being introduced it was “exploring strategic options” for its residence well being and hospice enterprise, together with a doable sale or spinoff. Shortly after that information broke, April Anthony, CEO of the corporate’s residence well being and hospice phase, introduced she deliberate to step down from her submit in June.

Embody Well being hasn’t settled on which different it’s taking, at the least not publicly. Stories positioned the corporate’s company jet in Rhode Island at varied factors in 2021, nonetheless, main some to take a position a couple of doable deal involving CVS Well being (NYSE: CVS).

Brookdale and Embody Well being are residence well being leviathans. The sheer quantity of change occurring with these organizations proper now make them ones to observe over the subsequent few quarters.

Lifesprk

Lifesprk solidified a spot on this record simply earlier this week, when the Minnesota-based senior care supplier outlined plans to amass Tealwood Senior Dwelling.

The transfer is extraordinarily distinctive, as few in-home care suppliers have aggressively gone after actual estate-based enhances to their enterprise. It’s additionally classically “Lifesprk-ian,” which has made a reputation for itself because of its willingness to take dangers and its payer-agnostic, setting-agnostic strategy to senior care.

Based in 2004, Lifesprk’s companies embrace residence well being, hospice, palliative care, major care and extra. After buying Tealwood, it is going to additionally run 35 senior dwelling communities situated throughout Minnesota and Wisconsin, plus a handful of expert nursing services (SNFs).

“There’s plenty of segregation in [senior living],” Lifesprk CEO Joel Theisen instructed HHCN. “There’s plenty of alternative. We felt like the identical points across the damaged well being care system have been plaguing these populations, so we did make an energetic effort to begin occupied with, ‘Man, we must always actually in all probability do the total property administration.’”

Lifesprk may also obtain actual property curiosity as a part of the deal.

Dr. Invoice Thomas — Lifesprk’s chief independence officer — and different senior care leaders have repeatedly referred to as for a revisioning of the normal senior dwelling neighborhood. Lifesprk’s curiosity in Tealwood is a step in that path.

Following the deal, Tealwood will fall beneath the “Lifesprk Senior Dwelling” model. Integration is already underway, with Lifesprk presently attempting to find its subsequent senior dwelling contracts and properties.

If Lifesprk finds success in a hybrid residence health-senior dwelling mannequin, it might encourage different firms to launch related efforts. Residence care franchise firm BrightStar Care is among the many solely different in-home care gamers to noticeably put money into the senior dwelling house.

As of September, BrightStar had a number of communities in Wisconsin, Indiana and Ohio. Initially, BrightStar determined to begin shopping for land to construct senior dwelling areas for its sufferers who have been starting to have higher-acuity wants.

“Households wished to have the ability to transfer their family members out of the house to one thing with extra socialization, and so they have been in search of suggestions from us for assisted dwelling, dementia and reminiscence care communities of their space,” BrightStar Care founder and CEO Shelly Solar mentioned on the 2020 HHCN FUTURE convention.

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