Acquisitions of Hospice Agencies by Private Equity Firms and Publicly Traded Corporations

Over the past 3 decades, the hospice industry has transitioned from a mostly not-for-profit sector to one where nearly two-thirds of all agencies operate on a for-profit basis. A substantial driver of this trend has been the growth of large for-profit hospice chains, many of which are part of publicly traded corporations (PTCs). In general, for-profit hospice agencies have been associated with higher rates of live discharge, lower levels of skilled staffing, and provision of a narrower range of clinical services than nonprofit agencies.1,3,4 An understudied and less visible factor is the more recent entry of private equity (PE) investment into the sector. Facilitated by relatively easy market entry and the prospect of stable Medicare payments, PE firms and PTCs have made strategic hospice investments in recent years, raising quality concerns among some policymakers and patient advocates. In this study, we measure the prevalence of hospice agency acquisitions by PE firms and PTCs over the period from 2011 to 2019.