The Pennant Group Acquires Arizona Home Health Provider; Caring People Lands Multiple Home Care Companies

Pennant kicks off 2021 M&A activity

The Pennant Group Inc. (Nasdaq: PNTG) has kicked off its 2021 M&A push.

The Eagle, Idaho-based post-acute care provider announced Tuesday it has acquired Sacred Heart Home Health Care, which provides home health services in Phoenix and Tucson, Arizona. The acquisition was effective Jan. 16, 2021.

“This strategic, off-market acquisition expands our service offerings in the Tucson market and strengthens our presence in Phoenix,” Pennant CEO Danny Walker said in a press release. “We have been eager to add home health services to the care continuum in Tucson for some time.”

The Pennant Group is a holding company of independent operating subsidiaries that provide health care services through 80 home health and hospice agencies, plus 54 senior living communities. The overall enterprise has locations throughout Arizona, California, Colorado, Idaho and 10 other states.

Founded in 2008, Sacred Heart Home Health Care is a provider of skilled nursing, therapy and social services. The company admitted about 730 patients last year, according to Pennant.

With Sacred Heart now under its umbrella, Pennant will continue to pursue additional opportunities to acquire home health, hospice and senior living businesses throughout the U.S., President Brent Guerisoli noted in the release.

Caring People acquires Always Here Home Care, Kosher Caregivers

Caring People recently announced it has acquired Boston-based Always Here Home Care, along with Boca Raton, Florida-based Kosher Caregivers. Both companies provide home-based care services.

Caring People is a portfolio company of private equity firm Silver Oaks Services Partners. The company currently operates in New York, New Jersey, Connecticut, Florida and Texas, serving an average of 1,700 clients per day.

Both deals give Caring People a stronger foothold in the Northeastern U.S. and Florida, according to the company.

“We’re very proud of the reputation we’ve built throughout our geographic service locations and have proven that as long as quality care and employee support are the cornerstones of your organization, they will not get diluted as the organization expands,” Steven East, CEO at Caring People, said in a press release.

Last year, Caring People told Home Health Care News that acquisitions would continue to play a role in the company’s growth strategy moving forward.

The company already has more potential acquisition targets in place, according to East.   

“We’re already looking at two to three more opportunities to close before Q2; this will be another milestone year for us,” he said. “I’m tremendously grateful to have found companies who mirror our culture, mission and values. It’s a privilege to join forces with like-minded companies and owners.”

CareFinders Total Care purchases ORI HomeCare

CareFinders Total Care has acquired home care company ORI HomeCare. The move further solidifies its presence in the Pennsylvania market.

Hackensack, New Jersey-based CareFinders provides in-home care services to more than 8,500 patients throughout New Jersey, Pennsylvania and Connecticut. Pennsylvania is a significant part of CareFinders’s growth strategy.

Currently, the company has nine offices in Pennsylvania. The company recently purchased Pennsylvania-based Union Home Care, along with other local providers.

“The combination of ORI HomeCare and Union Home Care, in addition to Philadelphia Home Care Agency and At Home Quality Care, provides great strength for [CareFinders Total Care] as the company continues to develop its presence in the Northeast region,” Jim Robinson, the company’s CEO, said in a press release.

For ORI HomeCare, the deal allows the provider to align with a company that shares its goals.

“I believe this partnership will allow us to bring the highest quality care to more patients in need while providing our caregivers with new opportunities for growth and development.” Terri Matthews, owner and CEO of ORI HomeCare, said. “There is a lot of change in store for home care in Pennsylvania, and we look forward to becoming part of the premier home care network that our MCO partners will continue to rely on.”

Saltzer Home Health rebrands

Saltzer Home Health recently announced it will now operate under the name “Terrace Home Health.”

As a company, Terrace Home Health’s services will include hospice, home health, personal care and outpatient therapy. It operates in the Idaho and Missouri markets.

The rebrand is part of the company’s larger focus on health management and value-based health care approaches moving forward.

“Our mission remains dedicated to providing personalized care with dignity, respect and compassion,” Terrace Home Health noted in its announcement.

Nova Leap secures Ohio home care business

Nova Leap Health Corp. (TSXV: NLH) has finalized its purchase of an Ohio home care business.

“A warm welcome to the outstanding team in Ohio,” Chris Dobbin, president & CEO of Nova Leap, said in a statement. “We look forward to exploring many more opportunities in the region for years to come.”

At this time, no further details of the deal have been made public.

Nova Leap is based in Halifax, the capital of the Canadian province of Nova Scotia. Nova Leap is a home care services company that operates in the U.S. and Canada.

The company has been steadily growing its U.S. footprint. In the past few years alone, the company has also acquired Massachusetts-based Keystone Home Care LLC and Oklahoma-based Around the Clock Home Care LLC, among several other businesses.

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Mission Healthcare Hires Two New Executives; Lifesprk Names New President

Mission Healthcare adds to executive team

Mission Healthcare has made new additions to its executive leadership team.

The company named JoAnn Mack its chief operating officer and Damien Weston its chief growth officer.

Mission Healthcare — which has more than 600 employees — is a San Diego-based home health and hospice services provider with 10 locations serving the Southern California region.

The hiring of Mack and Weston is part of Mission Healthcare’s broader growth strategy. Both executives were brought on to guide the organization with its overall expansion plans.

Prior to her appointment, Mack held leadership positions at VNA Health of Santa Barbara, Vitas and Interim Healthcare. She is also a member of the National Hospice & Palliative Care Organization (NHPCO), California Hospice & Palliative Care Association (CHAPCA) and California Association for Health Services at Home (CAHSAH).

“JoAnn’s deep involvement in the industry and years of experience will prove invaluable to the Mission Healthcare team as we continue our 10-year track record of growth and success,” Paul VerHoeve, CEO of Mission Healthcare, said in a statement. “Her leadership will be instrumental in ensuring we consistently deliver high-quality care and strengthen our company culture as we expand into new markets. We feel very fortunate to attract great talent that will be instrumental as we continue to expand into more western states.”

Before joining Mission Healthcare, Weston held leadership roles at Compassus, Gentiva and Kindred Healthcare.

“We are thrilled to put Damien at the helm of our expansion efforts. His experience will be integral to helping us scale strategically and expand our quality care offerings,” Verhoeve said.

Lifesprk appoints new president

Lifesprk has announced that Elmer Baldwin has been named company president. Baldwin has a history with Lifesprk — having served as the company’s long-time advisor.

Lifesprk is a Minnesota-based health care provider with a suite of home-focused services.

Baldwin steps in for former president Tom Schmitt, who will now serve as executive director of value-based payment strategy and growth at Lifesprk.

In his new role, Baldwin will oversee the development of Lifesprk’s business model, as part of the company’s overall growth strategy.

“We are growing in all our lines of business, including community-based in-home services, Medicare skilled home care, property management, primary care, acute care at home and hospice, while investing in our value-based, tech-enabled alternative delivery system designed to help seniors age magnificently,” Baldwin said in a press release.

Baldwin has been a Lifesprk advisory board member for the past decade. Prior to his latest appointment, he served as senior executive director of technology investment banking with Minneapolis-based Cherry Tree & Associates.

Caring People names brand ambassador

Caring People has added Jo Alch as a brand ambassador to its team.

A portfolio company of private equity firm Silver Oaks Services Partners, home care company Caring People currently operates in New York, New Jersey, Connecticut, Florida and Texas, serving an average of 1,700 clients per day.

Alch has joined Caring People to support its plans in relation to leveraging new opportunities, partners and PR efforts.

“Establishing and fostering relationships with industry leaders in a variety of spaces will ultimately benefit our seniors tremendously,” Alch said in a press release. “I, and Caring People, truly have a heart for the elderly. This role will provide fresh opportunities for new organizational partnerships with a unified goal: compassionate and highest-quality senior care.”

Before joining Caring People, Alch founded Acappella — a Texas-based home care agency — in 2006.

Caring People also noted that Alch is a thought leader and prominent figure in the Texas health care community.

Additionally, she has served on the board of directors of the Texas Association for Home Care and Hospice and was the committee chair for the Dallas Area Agency on Aging Advisory Council.

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Caring People Building Its Business by ‘Reinvigorating’ Home Care Owners

Sky-high equipment costs and staffing shortages tied to the COVID-19 virus have made it drastically more difficult to run a profitable home care business for many operators. That’s not true for Caring People, CEO Steven East told Home Health Care News.

Caring People has had to face its fair share of challenges over the past several months, but the West Palm Beach home care provider has been able to leverage its scale to stay in the black. A portfolio company of private equity firm Silver Oaks Services Partners, Caring People currently operates in New York, New Jersey, Connecticut, Florida and Texas, serving an average of 1,700 clients per day.

In addition to avoiding “going upside down financially,” Caring People has also had success recruiting caregivers and adding to its leadership team.

HHCN recently connected with East to learn more about COVID-19’s impact and the toll it takes on home care operators. During the interview, the CEO also touched on what Caring People looks for in its acquisition targets and how the company is tapping into new service lines.

Highlights from HHCN’s conversation with East are below, edited for length and clarity.

HHCN: Providers have incurred higher-than-normal operational costs in 2020 because of the COVID-19 pandemic. What has “the cost of COVID” been for Caring People?

East: If you want to break it down to a micro level, every visit that a provider performs, you have to protect your caregivers and clients with personal protective equipment (PPE). In the past, we didn’t have to do this. It’s definitely increased per visit costs by several dollars. If you’re going through multiple gloves and masks, then that increases costs exponentially. While it is a cost, we haven’t found it to be a very significant impact on the business.

One of the interesting things that evolved during the pandemic was the need to have safer transportation service for our caregivers, too. They were not comfortable going on public transportation. The clientele didn’t want someone who just rode the train to go in and take care of them. We had to become more reliant on Ubers and similar services.

We were also lucky because we had our own internal van service. We were able to start leveraging our fleet of vans, with about four or five vans driving all over New York, New Jersey and Connecticut during that initial wave of the pandemic. We were able to get our caregivers from Point A to Point B. Clients were more comfortable knowing caregivers were taking the van and not riding on the train with 50 or 60 other people. That was a cost we incurred, but it also helped us continue services for our clients.

With the added costs in mind, how do your financial margins compare to last year? Is it harder to run a profitable business?

At our scale, No. I remember the days when I started out, doing eight different jobs in the office. Margins were so tight back then that if my cost of care went up by 10%, I probably was upside down financially.

Now, we’ve been doing this for 20-plus years. We have significant back-office support. We’re able to really navigate the situation a little bit better than if I was still just a single-site provider. I could definitely see how PPE and other COVID-related costs can adversely impact someone, but we’ve been very fortunate.

Caring People is currently experiencing growth in administrative staff and caregivers. Can you provide some details and numbers around this?

We added two new executive positions: chief operations officer and the chief people officer. There is a need to have super-talented individuals in leadership positions as we continue to grow. We don’t ever want to sacrifice our delivery of care because of growth. We want to always make sure we have the right people in the right positions, at the right time.

As far as caregivers are concerned, we have a very comprehensive recruitment process. We have a completely centralized recruitment team, which has worked tirelessly since COVID-19 first hit. They were doing everything they could to source caregivers and onboard them. We went to a completely virtual onboarding process, so we’ve been able to keep our pipeline of caregivers going. We were very lucky that we weren’t seeing a dwindling workforce while demand continued to increase.

We saw a significant influx of folks coming from the service industry to work with our clients, individuals who could benefit from just the companion-type of service. For our companion business line, non-certified caregivers, we definitely saw more availability.

Your company has been active on the acquisition front, with its latest purchases being Acappella In Home Care, Aging Care LLC and AMR Care Group. Will acquisitions continue to play a major role in the company’s growth strategy moving forward?

It’s definitely part of our growth strategy, especially when we look at new potential markets and also adjacent markets to where we are now.

We have an approach that focuses on acquisitions, as well as organic growth, which includes new branches and also new service lines.

When it comes to acquisition targets, we definitely look for culturally aligned owners. It’s not our preference to do an acquisition where you go to closing, then the owners disappear right afterward. We like owners who want to stay on and be part of a larger company. We support the parts of the business they’re passionate about by removing all the stuff that kind of bogs you down, such as payroll, making deposits, etc. Once that’s off of an owner’s plate, they get reinvigorated with the business.

That’s the stuff that we really enjoy — sitting at a table with the owners. I’ll sit with 10 or 12 owners of companies that became part of the Caring People family. We’ll talk about different ideas, different growth strategies, different things they’ve always wanted to do but couldn’t. For me, having owners who want to be part of that vision is critical. Everything else will fall into place if you have that.

Do you have any specific goals when it comes to acquisitions? Are there new markets that Caring People is trying to enter? A specific amount of targets the company wants to purchase?

We’re very disciplined, so we’re not going to get out of our comfort lane when it comes to acquisitions. We’ll look for companies that, as I said, have that cultural alignment. It’ll probably be in a geographic location that’s desirable to us. We don’t ever go into the year saying, “Well, we want to get 10 or 20 done this year.” I don’t think it’s realistic to ever position it that way. It’s about finding the right opportunities. We have a great system and process for meeting owners and sourcing opportunities. So it’s just finding the right people, then we kind of see where the conversation goes. But we’ll focus primarily on markets that were attracted to.

What do you expect in-home care M&A activity to look like in 2021?

I don’t have a crystal ball for that.

I think you’re seeing a lot of activity now because people want to take some of the tax benefits of 2020, and there’s a lot of uncertainty about what 2021 looks like. I think there’s going to be a lull for a bit in 2021. It’s been such a volatile year, to say the least, I think things are going to slowly come down at some point. The election will be over, the vaccine will be out, kids will be back at school, and I think people will take a deep breath and evaluate where they are.

It’s a great time to be in home care and a great time for people who are thinking about getting out or joining a larger company. But I think once January comes, that first-quarter gets a little slow.

Aside from acquisitions, what else has helped your company see growth?

We are now getting more involved in understanding how to implement different service lines for our clients, such as telehealth, collaborating with physician practices that do video assessments. We’ve begun offering different geriatric care management services in most of our markets now, which we’re also doing virtually. I think there’s a lot of opportunities to grow organically, especially as people are embracing the digital space.

Last month, your company launched an Alzheimer’s and dementia care program. Can you provide an overview of the program and an update on how it’s going?

About 80% of our clients have a primary or secondary diagnosis of Alzheimer’s and dementia, so it behooves us to really start to dive into understanding the best way to deliver care for that client population. By advanced training with our staff members and hiring certified dementia specialists, we now are able to add that next layer of services to our clients.

Our caregivers go through a very rigorous continuing education program that is customized for our caregivers and our clients. We call it the Caring People University. We’re slowly continuing to evolve the way we can offer support services to our clients.

We have other ideas that we’re looking to further deploy over the next several months.

For me, the bottom line is really a byproduct of everything else that goes into the business. If you provide a high level of service, your turnover is going to be less, caregivers will stay longer, and clients will have a better experience.

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Caring People Acquires Acappella In Home Care, Aging Care and AMR Care Group

Caring People is staying busy on the acquisition front.

In fact, the New York City-based Caring People has completed a handful of strategic deals — with a focus on care management organizations — in the last few months alone. The acquisitions consist of Acappella In Home Care, Aging Care LLC and AMR Care Group, all of which were purchased in separate transactions.

Financial terms of the deals were not disclosed.

Caring People is a portfolio company of private equity firm Silver Oaks Services Partners. The private-duty home care provider operates in New York, New Jersey, Connecticut, Florida and Texas, the latter state recently added to its geographic mix. Across its operations, Caring People serves an average of 1,700 clients per day.

Although Caring People CEO Steven East declined to disclose the financial terms of the deals, he told Home Health Care News that the transactions fell in-line with the current pricing parameters for private-duty home care assets.

“We feel very confident in the investment in those businesses,” East said.

Acappella In Home Care provides home health, hospice, private-duty home care and companionship services throughout 13 Texas counties.

“Texas is a terrific senior care market. It has very strong private-pay demographics,” East said. “At the beginning of 2020, I can’t say I could have predicted we’d be in Texas, but we’re not limited geographically.”

Meanwhile, Aging Care is a care management and non-medical home care company that operates throughout central Connecticut.

New York-based AMR Care Group is a care services company that enables seniors to age in place. The company is partly known for its Cultured Companions program — a service that connects older artists, musicians, professors and others with younger counterparts in their respective fields.

On its end, AMR Care Group had grown at a 97% clip from 2017 through last year. In 2018, the company’s annual revenue checked in at about $2.2 million.

“I don’t think there’s been a magic bullet to our growth,” the company’s founder and CEO Anne Markowitz Recht told HHCN last September. “There’s obviously a huge need for home care services, which everybody knows about. Beyond that, it’s just doing the right thing, expanding our business and giving clients what they want.”

Along with being a great cultural fit, all three companies were attractive acquisition targets because of their owners and infrastructure, according to East.

“We have a back-office support team that can scale and support new offices all over the country,” he said. “With these three acquisitions, what was attractive to us was that they had very like-minded owners, who all stayed on with the organization in different roles. We felt that we could continue working with them and growing what they built.”

Acappella In Home Care founder Jo Alch, for example, has moved into the role of ambassador of brand development for Caring People.

The acquisitions also allowed Caring People to expand the company’s service lines.

“[Aging Care and AMR Care Group] had a core competency in providing care management services,” East said. “That’s a revenue vertical and a service line that we’re very interested in adding to our existing platform. Those acquisitions were strategic in terms of getting that talent.”

In addition to the three acquisitions, Caring People recently opened a new branch in New Haven, Connecticut, last month.

“We set up that branch because we knew there was a great caregiver population in that area,” East said. “We felt that having an office in that location would give us some better positioning for recruitment.”

Looking ahead, East says Caring People will continue to take a multi-pronged approach to growth.

“Acquisitions are definitely part of [our growth strategy], especially as we look at new and existing markets,” he said. “Adding new service lines to our existing business is also part of it, as well as de novo branches to service clients. We see it as a mix, but acquisitions are definitely an important component [of our growth strategy] — at least 50% or 60%.”

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