In the rapidly evolving landscape of healthcare, small and medium-sized home healthcare providers play a crucial role in delivering quality care to individuals in need. As home healthcare continues to provide better access, improve outcomes and save money for payors, the demand for home-based services continues to grow. As a result, new opportunities await these small and medium-sized businesses, making it increasingly important for providers to prepare themselves for successful sales opportunities.
Recent trends in the industry indicate new opportunities for small and medium-sized home healthcare providers. In 2021 alone, three (3) large-scale wind-ups resulted in over $20 billion in acquisitions for small and medium-sized home healthcare providers. Given this rapidly shifting landscape, smaller providers are in a prime position to capitalize on their businesses’ inherent value by preparing for a potential sale to private equity investors.
Preparing for a potential sale involves various strategic steps. Before being ready to engage an investor and potentially make a market-exit, every home health provider must ensure compliance in various areas:
- operating within state compliance guidelines;
- implementing acceptable billing and coding practices; and
- following corporate formalities.
To ensure a smooth exit and sale, sellers need to ensure their current operations are not only legally compliant but also efficient. Any deficiencies or irregularities can potentially derail an otherwise promising deal, reducing the company’s appeal to potential buyers.
In addition to compliance and operational efficiency, home healthcare providers should ensure that provider agreements are up to date and in order. When determining which home healthcare provider to engage with and ultimately acquire, potential buyers will want to ensure that any agreements are in-order and ready to be assigned and continued. Ultimately, the value of a small to medium-sized home healthcare provider lies in its established agreements and connections.
How Frier Levitt Can Help
In addition to providing counsel on a transaction, Frier Levitt can ensure that any home healthcare provider operates efficiently and in compliance, positioning them to maximize the opportunities of a potential sale. Contact us to speak with an attorney.
