If you’re an owner of a healthcare services company, chances are you are getting approached regularly, even daily, by private equity groups, strategic buyers, independent sponsors, and search funds, all eager to talk. Some may have suggested attractive “multiples” that they will pay for companies like yours. It sounds flattering, even tempting. You think, “I’ve got a willing buyer, let’s keep it simple and cut out the middleman.” Think again. We know how this might sound. Yes, we’re advisors — and yes, we benefit when sellers hire us. But stay with us. This isn’t a sales pitch. Whether you work with us or another experienced advisor or banker, this is about making sure you don’t leave millions on the table. Here’s why: 1. It’s Not Just About Finding Buyers – It’s About Finding Your Ideal Buyer In today’s market, especially in the healthcare services sector, there is no shortage of buyers. If you own a solid business, you’re most likely getting approached regularly. You may even be thinking, “I don’t need a banker; the buyers are coming to me.” But here’s the reality: finding a buyer is the easy part . Finding the right  buyer, getting top-of-market  terms, and protecting yourself through diligence, closing, and post-closing reconciliation — that’s the hard part. That’s where a competitive, advisor-led process delivers real, measurable value. 2. Good People – Even Better Negotiators Buyers may seem friendly. Most are genuinely high-integrity people. But don’t forget who they work for: investors. And their job is to get the best deal possible — for them , not for you. Private equity firms, in particular, are professional dealmakers. They do this every day. They know what levers to pull. They know how to frame their offer just right to make you feel like you’re winning, even when the deal is structured entirely in their favor. Meanwhile, most business owners are selling for the first (and only) time. That’s not an even playing field. 3. Even PE Firms Hire Bankers When They Sell — Why Don’t You? Here’s a telling fact: when private equity groups go to sell a portfolio company, they almost always  go through a banker-led competitive process. Why? Because they know it’s the only way to: Maximize valuation and terms Maximize closing certainty Generate competitive tension among buyers Create backup options if the chosen buyer drags their feet or tries to renegotiate post-LOI If the pros won’t go to market without an advisor, why would you? 4. Where Many Sellers Slip: Naming Your Price First It often starts with a simple question from a buyer: “How much do you want for your company?” You give them a number. They come back with something just below that, maybe with some “stretch” language to make it feel generous. But look closer at the deal: There’s a seller note (you’re effectively financing the buyer) Payments are deferred (vs cash at close) There’s an earnout (you’re taking on all the post-close performance risk) You’re rolling equity, but you’re last to get paid from a liquidity event, and often at a diluted value It’s not just about the headline number — it’s about structure, terms, timing, and control. And most self-negotiated deals get structured in ways even the well-informed seller doesn’t fully understand until it’s too late. 5. “Fair” ≠ “Market” Buyers love to position their deals as “fair.” It sounds reasonable. It sounds cooperative. But in practice, it’s a subjective term – one that can make a deal seem better than it is. “Fair” is subjective. “Market” is real. And unless you’ve run a proper process and seen multiple offers, you don’t know what “market” is.  That’s how buyers keep you in the dark — and get you to accept less than you could have achieved. 6. Premium Companies Get Premium Outcomes Strong, high-performing agencies don’t just deserve “a good deal” — they often receive something better: a premium . We always give valuation guidance to our clients before going to market — informed by comps, investor sentiment, experience, and current deal trends. But we’re often pleasantly surprised by where the market actually takes the deal, especially with premium businesses. Why? Because when the right buyer  meets the right opportunity  at the right time , strategic motivation can drive valuations far above guidance. It’s not uncommon to see bidding wars erupt over highly differentiated companies — and those wars don’t happen without process, positioning, and pressure. If you’re running a great company, don’t settle for “reasonable.” There’s a good chance your business is worth more than you think — but only if you let the market tell you. 7. We’ve Seen This Movie Before — And Changed the Ending We’ve had multiple clients approach us after they’d already negotiated a letter of intent directly with a reputable, strategic buyer. They were ready to sign. Each time, we reviewed the deal. We saw opportunities to push back. To create leverage. To run a fast but focused market process, all while keeping the buyer interested and at bay. Each time, we got them a significantly better deal.  In some cases, it was with the same buyer . In others, it was a new buyer altogether. Either way, just introducing competition changed everything — often adding millions  to the final purchase price and dramatically improving the terms. Even the threat  of competition made buyers step up. That’s how leverage works. 8. Think You’re Saving Money? Think Again. Some sellers avoid hiring an advisor because they think they’re saving money by going direct. Hiring a banker is not a cost. It’s an investment.  And like any smart investment, it comes with a return — one that pays off at closing, in the form of a better price, better terms, and higher certainty of close. It’s a performance-based investment with virtually guaranteed, immediate ROI. 9. Better Odds of Closing. Better Terms at Close. Deals fall apart for all kinds of reasons — diligence issues, financing delays, buyer fatigue, retrades. But when sellers work with an experienced advisor who runs a real process, the odds of closing go up dramatically. And just as important, the odds of closing on the originally agreed terms  go up too. Buyers are far less likely to drag their feet or re-cut a deal if they know there are other interested parties waiting in the wings. And they will not want to have a reputation in the healthcare M&A world as less-than-honest dealmakers. You’ve Heard Our Perspective We’re not asking you to take it on faith — we’re asking you to look at the facts, the market, and what happens when real competition is introduced. Whether you work with us or not, make sure you’re not negotiating alone. The Bottom Line When a buyer approaches you directly, they’re doing what buyers do — trying to get the best possible deal for themselves. There’s nothing wrong with that. But it means the process will be tilted in their favor unless you change the dynamics. That’s what an advisor does. We reset the playing field. We bring the right buyers to the table, create competition, and ensure you’re in a position of strength throughout the process — not just at the LOI stage, but all the way through diligence and closing, and often even beyond. You’ve spent years building your business. When it’s time to sell, you deserve more than just a “reasonable” offer. You deserve a market-tested outcome that reflects the true strategic value of what you’ve built.

Behavioral Health M&A Reading recent headlines, one might be inclined to think M&A activity across behavioral healthcare is in the midst of a slowdown. But while deal volume has receded from the highs of 2021 and 2022, behavioral healthcare is on track for a total number of mergers and acquisitions that still outpaces historic norms. In the third quarter, 40 deals were reported—a figure that puts 2025 on track for about 167 transactions by year’s end. For comparison, behavioral healthcare was seeing roughly 100 deals per year completed before the COVID-19 pandemic. “And a lot of deals lag, too,” added Mertz Taggart managing partner Kevin Taggart. “It could be three or four months before some transactions are announced publicly. When all is said and done, I would anticipate a final total for 2025 that ends up higher than the current projected total.” While tighter lending environments and negative headlines—including Acadia Healthcare announcing the closure of multiple facilities and layoffs of about 400 employees   and several bankruptcies announced by other provider organizations within the industry—buyers’ interest has not waned. Mertz Taggart closed three deals in Q3, and has closed seven behavioral transactions to date for 2025, with more expected by year’s end. “Deals are still getting done with attractive multiples for highly desirable companies,” Taggart said. “They're are getting a little harder to complete. We’ve had a few this year where the first buyer fell through, so we’ve had to move on to the second one.  “Private equity is still reaching out to us weekly looking for behavioral health opportunities,” he added. Of the 40 behavioral healthcare transactions announced in Q3, 10 were growth deals, continuing a trend that has emerged post-COVID. A threshold for such investments could be looming on the horizon, though, Taggart cautioned. “We’re going to see some of these groups struggle to get additional investment because of their sky-high valuation,” he said. “They’re valued more like tech companies, and you still need people to operate them. But some are starting to do acquisitions as well, so we’ll see. “I do think the growth capital market will slow because the brick-and-mortar groups can use technology as well.” Overall, Taggart said, the firm expects a strong finish to 2025 and is bullish on 2026. Addiction Treatment M&A A total of eight transactions involving addiction treatment providers were announced in Q3, bringing the year-to-date total to 27.  Prior to 2021, addiction treatment was a stalwart of deal volume. Activity has decreased in recent years, though, as organizations that could be counted on for making deals, such as Baymark, Behavioral Health Group, and to a lesser degree, Summit Behavioral Health, Pinnacle Behavioral Health, and others have slowed or stopped their growth through acquisition.  “There are new buyers coming into the space. That’s taken a little while to ramp up,” Taggart said. “Overall, I’m still bullish, although out-of-network is still tough.” To that point, Taggart noted a recent report   that Pyramid Healthcare and Advanced Recovery Systems are preparing for sales. “These larger transactions, if and when they do happen and especially if they happen at strong multiples, will prompt more providers to do more deals,” he said. Taggart said he expects to see the addiction treatment market begin to open up again in 2026. Notable deals involving addiction treatment provider organizations in Q3 included the following: Mertz Taggart advised St. Joseph’s Recovery Center  in West Virginia on a platform transaction to an East Coast-based private equity group. The Ridge Ohio , a rehabilitation services provider with two facilities in Ohio, received $18 million in investments from Prospect Capital Corporation and Thesis Capital Partners. Bradford Health Services  acquired three Texas-based programs: The Last Resort Recovery Center , Crestone Wellness and  The Chapter House , making them one of more active buyers in the SUD market. Luxury SUD treatment provider The Hope House , a portfolio company of Chicago-based private equity firm Traverse Pointe Partners, acquired Winward Way Recovery  in Newport Beach, California. Crossroads Treatment Centers  expanded its footprint in Pennsylvania with a deal to acquire Family Health Services , an outpatient addiction treatment provider with two facilities in the greater Pittsburgh region. Louisiana-based Nova Vital Recovery  announced a statewide expansion in September with its acquisition of Magnolia Recovery Services . The deal complements Nova Vital’s recent addition of intensive outpatient programs in Shreveport and Monroe. Mental Health M&A The mental health subsector has continued its post-COVID acceleration in transactions, with 25 deals announced in Q3. Private equity firms have shown interest in mental healthcare providers, although buyers have gotten more discerning, Taggart said. “They’re looking for more medical practices versus strictly counseling-based providers,” he said. “Psychiatry practices are well-positioned going into 2026. Offering ancillary services, such as transcranial magnetic stimulation and Spravato (esketamine), is also helpful for margin expansion as well.” Among the most notable deals reported in the third quarter, The Carlyle Group  is acquiring Psychiatric Medical Care  in a $400 million, private equity-backed deal, according to a media report . Mertz Taggart represented Modern Recovery/Avery’s House , a teen mental health program based in Arizona & Idaho. All 10 growth funding deals reported in Q3 involved mental healthcare providers. This included value-based care provider AbsoluteCare  raising $135 million in equity funding to expand into new markets. Other growth deals announced: Diana Health  announced it raised $55.4 million in a Series C funding round led by HealthQuest Capital and several previous investors. Digital eating disorder treatment provider Equip Health  raised $46.6 million, according to public documents filed with the SEC. Another telehealth provider, the youth-focused startup Cartwheel Care , disclosed that it has raised $35 million of a $44 million funding round, led by an undisclosed investor. Other transactions involving mental healthcare providers in Q3 included: Rosecrance Behavioral Health , a not-for-profit therapy and SUD treatment provider, acquired Ascend CHC  in a move that will allow Rosecrance to add eating disorder care and specialty sports and performance counseling services. Cerebral , a telehealth-based provider, acquired Resilience Lab  in a private equity-backed strategic deal. Uwill , an international provider of mental health and wellness solutions, acquired tbh, which provides support for students and young adults facing basic needs insecurity and mental health challenges. Nystrom & Associates acquired the Minnesota-based operations of Ellie Mental Health , creating a combined organization that operates 84 locations across five states. Autism and Intellectual/Developmental Disabilities M&A Within the autism and intellectual/developmental disabilities (I/DD) subsector, eight deals were reported in Q3, bringing the year-to-date total to 27. Since the blockbuster year of 2021, in which 44 deals were announced, autism and I/DD provider organizations have faced significant headwinds from wage inflation, especially among behavioral technicians, Taggart said. However, as wages began to settle in 2024, momentum for deal activity has renewed. The transactions involving autism and I/DD therapy providers included the following: Mertz Taggart advised a Northeast ABA provider as a platform for a Canadian private equity firm. Achieve Partners  acquired Westside Children’s Therapy , a provider with 30 centers in the Chicagoland area.  First Children Services  secured a strategic growth investment from Station Partners  to support its continued expansion. Redwood Family Care , a multi-state provider of I/DD services, acquired Minnesota-based Eagles Wing , which offers residential and day support services to individuals with developmental disabilities. A Change in Trajectory , a Van Nuys, California-based, family-oriented agency that serves individuals with special needs, was acquired by Pine Street Group, an investment holding company that targets middle and lower-middle market businesses. DOMA , a Minneapolis-based provider of I/DD services, announced its acquisition of Payee Support Services  in Ohio, strengthening its presence in the Midwest. Following the retirement of longtime CEO Jack Priggen, Cardinal of Minnesota , a provider of residential and in-home services for persons with disabilities, has been acquired by The Cottages Group of Burnesville .

As uncertainty continues to loom in both the industry’s regulatory environment and the broader economy, home-based care M&A volume dipped slightly, predominantly from a decline in non-medical home care transactions. While activity slowed relative to the two prior quarters in 2025, Q3 remains in line with the transaction volume seen in 2024. Home-Based Care M&A Note: Total industry transactions do not necessarily equal the sum of the sub-industries, as many transactions include more than one sub-industry. A total of 20 home-based care transactions were completed during the quarter. Public company transactions accounted for four deals, while sponsor-backed strategic and private equity platform acquisitions accounted for eight and three, respectively. Despite the number of non-medical home care deals falling compared to the previous quarter, the sub-vertical still leads in M&A activity with 11 closed transactions during Q3. While speaking about the outlook for home-based care M&A through the rest of 2025 and beyond, Cory Mertz, managing partner at Mertz Taggart, highlighted the impact of future rate cuts by the Federal Reserve. He noted, “We’re seeing more optimism in the market after the latest quarter-point cut last month, especially from buyers looking for add-on acquisitions.” Mertz also touched on demand resulting from sustained levels of undeployed capital in private equity, “Although the overall number has come down recently, there’s still near-record dry powder that funds are actively looking to invest. If they can’t sufficiently invest out of their current fund, raising their next fund will become more of a challenge.” Home Health M&A   Seven home health transactions closed during the quarter, matching Q2 and maintaining the pace set at the start of the year. Three of the seven were public company transactions, with the The Pennant Group being responsible for two. It announced the acquisition of GrandCare Health Services , a home health agency serving California’s Los Angeles, Orange, Riverside and San Diego counties, and Healing Hearts Home Health , a Wyoming-based agency offering home health, non-medical home care and outpatient therapy services in seven communities throughout the state. Rounding out this quarter’s public company transactions was Optum’s  long-awaited $3.3 billion acquisition of Amedisys , a formerly publicly traded home health and hospice provider with 500+ locations across 37 states and Washington, DC. The deal closed after a two-year delay and a settlement with the Department of Justice where both parties agreed to divest over 150 assets, consisting primarily of home health locations, to BrightSpring Health Services and The Pennant Group. The remaining four transactions were private equity-related, split equally between sponsor-backed strategic and platform acquisitions. Sacred Heart Health Care , a portfolio company of Creach Family Holdings operating under the Faith Home Health and Hospice brand, announced the acquisition of Freudenthal Home-Based Healthcare , a Missouri-based home health provider, as it maintains its focus on becoming the leading in-home service provider in the Midwest. Marathon Nursing , a Massachusetts-based provider, was bought by Team Select Home Care , a portfolio company of Court Square Capital Partners. Regulatory uncertainty, particularly concerning CMS’s proposed rate cut of 6.4%, has remained at the forefront in the minds of acquirers when evaluating deals in the home health space. The proposed rule is set to be finalized in November and would take effect in January 2026. However, there is still considerable demand for quality assets in a space that’s historically had strong and consistent deal volume. Cory Mertz noted that “Although buyers are well-aware of the risks involved with a potentially large reimbursement cut, high-quality assets are still in strong demand. Of the major home-based care providers who are building a continuum of care in their efforts to negotiate value-based payment arrangements with the payors, skilled home health is the most prominent of the service lines.” Hospice M&A Hospice deal activity remained steady with six hospice transactions announced in Q3, one more than in Q2 and in line with both the 2024 and year-to-date 2025 averages. Among the six announced transactions was the acquisition of St. Gabriel’s Hospice & Palliative Care , a Texas-based provider of end-of-life care, by LifeCare Home Health , a Medicare-certified hospice, home health and private duty care provider in Texas, Nevada and Florida and portfolio company of healthcare services-focused private equity firm Zenyth Partners. BaneCare Management , a Massachusetts-based senior care services provider, also announced its acquisition of Longwood Hospice , enhancing its care continuum throughout the state. Concerns surrounding Medicare clawback risk continue to be present amongst buyers as billing and compliance diligence remains the key hurdle to consummating transactions in the hospice space, particularly in the so-called enhanced oversight states of California, Nevada, Arizona and Texas. Mertz Taggart maintains its firm guidance to would-be hospice sellers to seek out a comprehensive billing and compliance audit as a key first step prior to engaging a sell-side advisor when preparing for a sale. Cory Mertz noted, “It’s important to use a group that will quantify the clawback risk, financially.” Cressey & Company announced a partnership with Paradigm Health . Paradigm management, along with the company’s existing investor, Havencrest Capital Management, also made investments as the company pursues its next phase of growth. Despite strong demand, deals have proven difficult to get to the closing table. Diligence around billing and compliance have caused many proposed deals to fall apart. Buyers are fearful of Medicare clawback risk, a concern that is amplified in four “enhanced oversight” states—California, Arizona, Nevada, and Texas. As such, Mertz Taggart continues to strongly recommend that providers considering a transaction in the next 24 to 36 months first invest in a billing and compliance audit.  “We are strongly recommending a pre-market audit for operators, especially in those four states,” Mertz noted. “It’s important to use a group that will quantify the clawback risk specific to those four states, considering the current enhanced oversight environment.” Home Care M&A Non-medical home care M&A activity declined this quarter compared to the relative highs of Q1 and Q2 this year but generally stayed in line with last year's deal activity.  The largest announced deal this quarter where the purchase price was publicly disclosed was Addus Homecare’s $21.2 million acquisition of Helping Hands Home Care Service, a home care provider with three locations throughout western Pennsylvania serving approximately 600 patients daily. Addus CEO Dirk Allison said during the company’s most recent earnings call, “As we have with this most recent acquisition, our development team will continue to focus on both clinical and non-clinical acquisition opportunities that increase both the density and geographic coverage of our current states. We will be evaluating smaller clinical transactions along with personal care service transactions that fit our strategy.” In line with historical trends, sponsor-backed strategic buyers made up the bulk of the deals closed this quarter. Among them was Amivie ,   a multi-regional provider of non-medical home care and portfolio company of Martis Capital, which acquired FosterBridge , an in-home care provider serving patients in 23 counties across southeastern Ohio. Q3 also saw a platform investment in Elder Care Homecare , an in-home provider serving New York, New Jersey, Connecticut and Massachusetts, by private equity firm Rallyday Partners , opening the door for add-on acquisition opportunities throughout the Northeast. Non-medical home care held on to its spot as the darling of home-based care services investors, and Cory Mertz expects that trend to continue into both Q4 and 2026 as deal activity inches up, saying, “We’re still seeing high levels of interest in the home care space, driven primarily by sponsor-backed portfolio companies that are seeking additional cash flow before their scheduled exits in the next 12-18 months. We are also seeing an uptick in demand for private duty home care, as some of the strategic acquirers are looking to diversify their payor mix.” If you are interested, you can also download the .PDF version of the Q3 2025 Home-Based Care M&A Report via the following link:

How to Handle Inquiries About Selling Your Home Health, Hospice, or Home Care Agency Home health, home care and hospice agency owners are inundated today with “offers'' to buy their agency. We frequently hear from owners that multiple buyers have approached them trying to engage in substantive talks about an acquisition. Oftentimes, they even say that the buyer has talked about a price with them. A buyer who approaches you with an immediate offer doesn’t really know anything about your business. If they tell you they are paying a “multiple of X '' or paid “Y” for an agency “just like yours,” you should be skeptical. Unfortunately, what agency owners don’t know is that unsolicited offers are really just an attempt to get a foot in the door. How could they know any significant details about your agency upon which to base an offer? How are they comparing your agency to others? You may find yourself curious about the offer and value of your company itself. You may even be considering selling your home care agency or hospice or taking investment into your business and growing it. These unsolicited offers can be valuable—as long as you know how to respond. You would sell if the right offer came along: Simply put, the right offer is not going to come along out of the blue. Buyers who say they want to buy your agency are usually looking for a deal (or maybe even a steal). They know you’re not talking with multiple buyers and that you haven’t put together a comprehensive analysis of the M&A marketplace, including the value of your agency. They know you’re not represented by anyone who understands the market or the sale process. Waiting for the perfect opportunity to come along is not an exit strategy we advise. Knowing what your agency’s value is, what is happening in the marketplace, and preparing for a sale are key in preparing yourself and your agency for the right opportunity, and it’s never too early to start planning your exit strategy. If you are considering a sale - now or in future: 1. Prepare It’s important to carefully consider your next step, and this often means taking time to collect all necessary information. Before responding: Review their LinkedIn profile and/or company website. If it is in fact a buyer that has reached out to you, and not a broker or M&A firm, research whether the company has made previous home care, hospice or home health acquisitions. If the buyer’s identity is intentionally vague, be cautious in proceeding. A legitimate broker or banker who claims to have a buyer interested in your agency will be happy to share the buyer’s name in the first communication, and that the buyer is paying their fee. It’s not unusual for less-than-savory brokers to initially claim to have a buyer, only to then sell themselves as sell-side representatives. Evaluate how much bandwidth you have for the next 3-6 months to support transaction activity. Consider enlisting/incentivizing a key employee, confidentially, to help you with the transaction. This is not something you will need to do immediately, but identifying this individual may help you further down the road. When you do respond: Get some preliminary information on the buyer or investor, including: How do they plan to finance the transaction? Do they have cash in the bank, a credit line, or an established fund? If so, how much? A professional buyer or investor will not hesitate to share this information with you. Why is your company interesting to them? How does it fit into their acquisition or investment strategy? Tell them you will want to engage an advisor and will get back to them. A credible buyer or investor will not be deterred by the concept of having an advisor helping you in the process. In fact, most of them appreciate having a professional intermediary who can set the proper expectations with sellers. 2. Do as the pros do Private equity groups make their money buying and selling companies. They will buy a “platform”, then add several “add-on” acquisitions with the intent of selling the entire entity at a much, much higher price than they invested in the companies along the way. In other words, they are professionals at selling companies for the maximum amount, and under the best possible terms. They leave nothing to chance when it comes to selling their portfolio companies. Rarely will a private equity group engage with just one buyer when it comes time for them to sell . They will most likely hire an investment bank or M&A firm to run a competitive process with a pre-defined group of qualified buyers and investors. Private equity believes this is the only way they can ensure their investors that they were able to negotiate the most favorable transaction with their ideal buyer…the buyer that wanted the company the most. Similarly, it’s in your best interest to bring multiple buyers to the table. It’s easy to want to negotiate the first offer, especially if it appears compelling. But, as with any deal, the more buyer/investor competition there is for your agency, the better the conditions are for your ideal transaction. That is, maximum value, under the best terms, without renegotiating. When potential buyers are aware there is competition to acquire your agency, they are far more likely to come to you with their best (or near-best) offer, and much less likely to drag out negotiations and run the risk of losing the deal to another buyer. Multiple offers from competitive buyers is the best leverage for the seller in every aspect. There are many factors to consider: Who to include in your potential buyer or investor universe. Who are your “A-list” buyers, and how do you reach out to them confidentially ? Knowing how to show your business in the most positive, but credible light to those A-list buyers. How you will compare and negotiate multiple offers. Knowing what is considered “market” (vs. “fair”) for both value and terms. Keeping the process confidential. Having an employee, referral source or competitor find out you are considering a sale can certainly disrupt your business…and the sale itself. 3. Consider enlisting the services of a healthcare M&A advisory firm This process can be overwhelming without a team of experts by your side. One of the main benefits of using the services of a healthcare mergers & acquisition firm is that they allow you to focus on what you do best — running your home care business, while your representatives use their know-how to maximize your value and get to the closing table…with few surprises. When you engage a professional M&A firm, they consider the bigger picture while handling all the small details you may not have considered, including: Curating a proper “A-list” buyer and investor list. A-list buyers meet three criteria: They have plenty of financial resources to complete your transaction, including sufficient cash; They know the care-at-home industry. Strategic buyers won’t be an issue here, but if you’re considering engaging with a financial buyer/investor, make sure they are well-educated on the industry before engaging as you don’t want to educate them as they work through the acquisition process. They have sufficient transaction experience. In this case, the financial buyers won’t usually be a concern, but some of the strategic buyers may lack resources to complete a transaction in a timely manner. Most A-list strategic buyers have development teams dedicated to M&A. Taking the time-intensive tasks off your hands such as preparing and updating the financial data book and Confidential Information Memorandum (CIM). Maximizing the value of your agency by running a competitive bid process Ensuring deal certainty by addressing all potential roadblocks early in the process. Handling multiple stakeholders in the process, from lawyers to investment bankers and accountants. Receiving an email from a buyer interested in purchasing your agency can be both flattering and overwhelming. At Mertz Taggart, we pride ourselves on being present for, and guiding our clients through, the entire M&A sale process. 80-95% of most owners’ net worth is tied up in their businesses. Handling the sale like “ the pros do it ” is paramount to ensuring your ideal transaction. The best way to ensure that is by hiring an accomplished, respected, healthcare mergers and acquisitions firm. It’s never too early to start planning your exit. And the best way to start is by understanding the value of your home health, home care or hospice. If you are interested in a confidential, complimentary valuation, please contact us. If you are planning your exit strategy and are interested in learning more about selling a hospice, home care or home health agency, reach out to us at info@mertztaggart.com to arrange a confidential discussion about maximizing the value of your business.

After an especially active first quarter and with signs currently indicating a healthy and active pipeline, analysts at Mertz Taggart are bullish in their outlook on the behavioral healthcare market for 2025. Behavioral Health M&A A total of 47 transactions involving behavioral healthcare organizations were reported in the first quarter of the year. This included 34 M&A transactions, the most since Q4 2022. Activity within the intellectual/developmental disabilities (I/DD) and autism sectors has seen a resurgence, with a reported 12 transactions in Q1—the highest volume recorded since 2021. Sales of organizations that provide applied behavior analysis (ABA) therapy have been especially competitive, said Mertz Taggart managing partner Kevin Taggart. “During COVID and right after COVID, a lot of ABA companies experienced wage inflation without getting rate increases, so there was some high-profile bankruptcy with some large providers that left California, Colorado and other states,” said Taggart. “The dust has seemed to settle on that over the last six months or so, and so now we’re seeing a lot of groups asking for ABA businesses. That’s a positive.” Within the subsector of mental health, demand has remained consistent for going on two-and-a-half years. 29 transactions (19 M&A and 10 growth deals) involving mental healthcare providers were reported in Q1, a figure roughly in line with the 30 deals announced in the final quarter of 2024. Although it’s not readily apparent based strictly on the number of transactions announced, buyers’ interest in psychiatric hospitals is high, Taggart said. There simply aren’t enough smaller, independent providers available to meet the demand. “We’ve had more groups ask us for psych hospitals since Q1 this year than probably any quarter in the last three or four years,” he said. “But there are fewer smaller operators out there. There just haven’t been as many deals completed because there’s not enough supply. But there are definitely groups looking.” Finally, Taggart noted one additional trend to watch: the continued flow of growth deals at high valuations.  “Money has continued to pour in to these growth deals, which surprised us a bit,” he said. Addiction Treatment M&A Once a subsector that analysts could reliably expect to have the highest number of transactions in a quarter, addiction treatment deal volume has remained flat for two years now. Deals are still getting done, Taggart clarified, but not to the level of historical norms. Nine deals involving addiction treatment providers were reported in Q1, matching the total from each of the prior two quarters. This included seven M&A transactions and one growth deal. The following addiction treatment transactions were reported in Q1: Wellpath Recovery Solutions , a provider of services at inpatient psychiatric hospitals, residential treatment centers and mental health rehabilitation centers, as well as community-based services, was acquired by an undisclosed buyer in a deal that will cancel out about $375 million in debt of parent company Wellpath Holdings . Optimal Investment Group,  a Sherman Oaks, California-based private equity firm, made a strategic investment in Recovery Dynamics in Los Angeles . Substance use disorder (SUD) treatment provider Meridian Behavioral Health expanded its continuum of care with its acquisition of Gateway Recovery  in January. Denver-based addiction treatment providers AspenRidge Recovery  and Colorado Medication-Assisted Recovery  announced a merger in March. Both companies were founded by Cortland Mathers-Suter, who was named CEO of the combined company. Oceans Healthcare  acquired Haven Behavioral Healthcare , adding seven new locations across five new states, bringing the total number of states in which it operates to nine. The deal was backed by private equity firm Webster Equity Partners. The respective boards of directors of Family Service & Guidance Center  and Valeo   Behavioral Healthcare  announced their approval of plans to merge the two organizations into a single Certified Community Behavioral Health Clinic  within the next year.  Silver Hill Hospital  announced in February that it has completed its acquisition of Freedom Institute  to expand its psychiatric care services in New York City. As part of the deal, Freedom Institute has been rebranded as Silver Hill New York . 1888 Equity  acquired Jaywalker Lodge , a drug and alcohol rehabilitation facility in Colorado. Mertz Taggart  provided exclusive sell-side advisory services. Acadia Healthcare  completed its acquisition of North Carolina-based Sellati & Co .  Mertz   Taggart  provided exclusive sell-side advisory services. Two growth funding deals were also announced: You Are Accountable , a New York-based peer SUD support company, raised $1.9 million in funding, the company announced in February. Investors were not disclosed. Bicycle Health , a virtual opioid use disorder (OUD) treatment provider, completed a $16.5 million funding round led by Questa Capital Management . Mental Health M&A As mentioned above, demand has remained healthy for mental healthcare providers, particularly those that offer psychiatry and ancillary services, Taggart said. “There is still strong demand for mental health, especially psychiatry practices or groups that offer psychiatry services, even just medication management or ancillary services such as transcranial magnetic stimulation or ketamine-assisted therapy,” said Taggart. “There is still good demand for outpatient mental health—not to the level it was in 2022, but it’s been pretty steady in recent years, even with some notable strategic buyers taking a pause.” Those strategic buyers, he added, are now showing signs they are ready to get off the sidelines, a development that could spur more activity later this year. Deals involving mental healthcare organizations in Q1 included the following: Riverside Impact Capital , a firm that specializes in working with mental health practices, announced a strategic investment in Evergreen Counseling . Mertz Taggart provided exclusive sell-side advisory services. Traverse Pointe Partners  completed its acquisition of Soma Therapy  in a private equity platform deal.  Mertz Taggart provided exclusive sell-side advisory services. ARCpoint Inc. announced in January that it has completed the sale of 68% of its ownership interest in Achieve Behavioral Health Greenville . The buyer in the deal was not disclosed. Empower Community Care , a global behavioral health organization, acquired Brief Strategic Family Therapy Institute from the University of Miami  in a private equity-backed strategic deal. Avel eCare,  a telemedicine provider of clinician-to-clinician services, acquired Amwell Psychiatric Care,  a division of Amwell , in a private equity-backed strategic deal. The acquisition expands Avel’s footprint to over 45 states. Orchard Mental Health Group  (formerly known as Quince Orchard Psychotherapy ) made a private equity-backed strategic acquisition of GBCC Behavioral Health  and Oasis Behavioral Health Urgent Center . Eating Disorder Recovery Specialists ,  Mental Health Recovery Specialists ,  Sanctuary Psychology P.C. and  Well Williamsburg —entities founded by clinician-entrepreneurs Sarah Chipps, a psychologist, and Greta Gleissner, a licensed clinical social worker—have been merged to form Well Behavioral Health . Iris Telehealth  has acquired innovaTel  from Quartet Health  in a private equity-backed strategic deal. Days later, Quartet  itself was acquired by NeuroFlow , another behavioral health-focused tech company. Axess Family Services  and Children’s Advantage , a pair of not-for-profit providers that serve Portage County, Ohio, announced a merger in February. FullBloom , an academic, behavioral and mental health provider for schools, acquired school-based mental health provider CharacterStrong  in a move to support its increasing focus on mental healthcare. TPN.health , a behavioral health network platform, acquired All Counseling  and its provider-patient matching technology, TheraMatch . Boston-based The Stepping Stones Group  announced in March it has acquired Gallagher Pediatric Therapy in Fullerton, California, for an undisclosed sum. AI-powered mental health chatbot company Wysa  acquired April Health , a behavioral health company that works with primary care providers. Beacon Behavioral Partners  made two acquisitions in Q1, reaching agreements to acquire Shore Clinical TMS & Wellness Center and Cognizant Behavioral Health Services . Several mental healthcare organizations also announced growth funding transactions  in Q1, including the following: Mindful Health  completed a $12 million funding round led by WP Global Partners . Digital family mental health startup Little Otter  raised $9.5 million in a strategic funding round led by Next Legacy Management . Sonar Mental Health  raised $2.4 million in a pre-seed funding round for its AI-backed youth mental health startup. The funding round was led by Nina Capital . Digital mental health startup Nema Health  raised $14.5 million in a funding round that brought in two new investors: Deerfield Management  and CVS Health Ventures , the venture capital arm of CVS Health. Digital health company DarioHealth  raised $25.6 million from an undisclosed investor. Neurodivergent affirming therapy provider Prosper Health  raised $16.2 million in a funding round led by Kindred Ventures . Trail Mix Ventures   Fund II and Foreground Capital  led a $12 million investment round for Millie , a maternal mental healthcare company. TownHome Health  raised $500,000 according to SEC filings. An investor has not been disclosed. Digital alcohol use disorder treatment provider Ria Health  raised $12.5 million as part of a Series B funding round led by Peloton Equity . Bluebird Kids Health  raised $31.5 million in a funding round led by F-Prime Capital   Partners . Autism and Intellectual/Developmental Disabilities M&A The 12 transactions reported in the I/DD and autism subsector for Q1 were the most for a quarter since 2021.  One of the ABA therapy companies Mertz Taggart was working with in Q1, received the highest number of offers for any deal the firm has worked on since 2021, Taggart said. The following is a list of transactions involving providers of I/DD and autism therapy services: Ascend Capital Partners , a healthcare-focused private equity firm, acquired a majority stake in Unison Therapy Services . Healthcare-focused private equity fund Leavitt Equity Partners  partnered with Pediatrics Plus  in Conway, Arkansas. BrightSpring Health Services  divested its I/DD division to Sevita  (formerly known as The Mentor Network ) in a deal valued at $835 million. Already Autism Health  announced two acquisitions. First, it acquired Commonwealth ABA  in a deal backed by private equity firms Triton Pacific Healthcare Partners , Star Mountain Capital  and Ace & Co. The company also acquired C.A.B.S., Autism  and Behavior Specialists . Private equity firm Nautic Partners  acquired Proud Moments ABA  from PE firm Audax   Private   Equity . Three Maine-based not-for-profits— GMS , Uplift  and Independence Advocates of Maine —announced a merger. Meridian Executive Services  acquired Danville Services Corp.  In a private equity-backed strategic deal. Behavior Genius , a provider of ABA services, acquired Bay ABA  in the San Francisco Bay Area. Regency ABA  in Georgia acquired Magnolia Behavior Therapy  in Seattle, Washington. Strawberry Fields , a not-for-profit provider, became an affiliate of Devereux Advanced Behavioral Health . Delta Behavioral Health Group  was acquired by SpringHealth Behavioral Health   & Integrated Care . Frontera Health , an autism services startup that is backed by AI, raised $32 million in a seed funding round led by Lux Capital  and Lightspeed Venture Partners . If you would like to download this report in a PDF file, click the link below. Mertz Taggart is a leading healthcare M&A advisory firm specializing in transactions across behavioral health, home health, home care, and hospice sectors, as well as ABA services mergers and acquisitions. We help business owners maximize value, prepare for sale, and navigate every stage of the M&A process with expertise and confidentiality.

I get asked all the time…’what kind of multiple would my home care agency command?’ ‘Not So Fast’…There’s No Straight Answer. I would go as irresponsible to give guidance simply in the form of a multiple without knowing the other half of the valuation equation – Adjusted EBITDA .s far as saying it’ The Adjusted EBITDA can be dramatically different depending on whether it is based on a trailing twelve-month (TTM) period, calendar year, annualized pro- forma, or some other formulation. It can also vary significantly based on the buyer and which adjustments will be considered. The question should be, ‘what kind of VALUE would my home care agency command?’ which is more complicated. Let’s take a step back and explain the value equation that is commonly used in the home care industry. Value = (Adjusted EBITDA) x (the Multiple), whereby: Adjusted EBITDA (or Earnings Before Interest, Taxes, Depreciation and Amortization) is a proxy for “normalized” cash flow (normalizing for typical variations in a company’s revenue cycle). The Multiple is the inverse of the go-forward risk of that cash flow continuing after the transaction is complete. The lower the risk of cash flow deterioration, the higher the multiple. For example, a 7x multiple implies a 14.3% return and a 5x implies a 20% return, so the 5x multiple is viewed as a riskier investment for the buyer, therefore he/she requires a higher rate of return. Pretty straightforward, right? Well, not always. And here’s why …Adjusted EBITDA is in the eye of the beholder. Consider three case studies to illustrate: The Growing Agency I represented the seller of a home care agency with the following value drivers: Trailing 12 months (TTM) revenue of $12,o00,000 Trailing 12 months adjusted EBITDA of $2,200,000 (~18% of revenue) Strong growth Multiple locations Strong clinical and compliance program Non-CON state Virtually no seasonality After receiving multiple bids, and after negotiations, the successful buyer (a large private equity fund) came in with a valuation of $17,600,000. Clearly a healthy multiple of 8x ($17,600,000/$2,200,000), right? I can assure you the buyer was looking at this differently. Remember, this was a fast growing company that had no seasonality. Trailing 12 months (TTM) Last 6 months, annualized Revenue $12,000,000 $14,400,000 Adjusted EBITDA $2,200,000 $2,880,000 Multiple 7.3 5.6 So, what was the multiple? Depends on who you ask. The buyer was telling their board that they got this company for a steal – a multiple of 5.6 My client, the seller, was telling his golf buddies he sold for a multiple of 7.3x… EBITDA & multiples are in the eye of the beholder. Corporate Overhead and Synergies Here’s an example of a hospice we represented: Trailing 12 months revenue: $5,600,000 Trailing 12 months adjusted EBITDA: $800,000 Modest growth Strong clinical and compliance program Non-CON state After running a competitive bid process, the buyer agreed to pay $5,600,000 (or about 1x revenue). This company commanded a multiple of 7, ($5,600,000/$800,000) right? Maybe/Maybe not… In this case, the seller was paying an annual salary of $200,000 to a high-priced CFO who was not an owner of the company. Although he was instrumental in the success of the company, he was not needed by the buyer. This is typical, as nearly all strategic buyers have their own CFO who can take on these responsibilities. So the buyer would enjoy an immediate $200,000 bump in EBITDA on day one – to $1,000,000. To the buyer, this company was purchased for a multiple of 5.6x ($5,600,000/$1,000,000). The Low Margin Business Another example: Trailing 12 months revenue: $4,800,000 Absentee owner, not involved in the business Trailing 12 months EBITDA: $150,000 The sale price was $2,400,000, or a multiple of 16 ($4,800,000/$150,000). Clearly not a standard industry multiple for a privately held home care agency, but it was a competitive process and the company had a high strategic geographical interest to the industry buyer. In this case, the buyer saw some “low hanging fruit” in the seller’s cost structure and knew it could bring its EBITDA up to 12% (or about $600,000) very quickly. This included $220,000 in salary and “home office” expense enjoyed by the absentee owner who was not involved in the day to day operation of the business. In the eyes of the buyer, the multiple was a conservative 4x (or $2,400,000/$600,000). So that begs the question…what is the multiple of a break-even (or money-losing) agency that sells for any price? It’s all about the value. Reach out to us at info@mertztaggart.com for more information on home care, home health, and hospice valuations.

Mertz Taggart follows the publicly traded home-based care companies and reports on their earnings calls each quarter. As a group, public company performance and share price serve as a proxy for industry performance and investor sentiment, respectively. Historically seen as the “ultimate consolidators”, the publicly traded home-based care trading multiples have a downstream effect on lower middle market home-based care M&A. Addus Homecare (Nasdaq: ADUS) Highlights Addus reported $349.4 million in revenue, up 21.8% from Q2 2024. Growth was led by the Personal Care segment, which represents 77% of the business and saw a 7.4% year-over-year organic revenue increase, driven by higher volumes, state rate hikes, especially in Illinois, and strong hiring. The company’s EBITDA margin rose 24.3% year-over-year to $36.8 million, and net income increased by 34.1% year-over-year to $21.2 million, reflecting robust operational execution and profitability. The company’s Hospice segment, representing 17.8% of Q2 2025 revenue, grew organically by 10%, supported by higher census and greater patient days and revenue per day metrics. The Home Health segment, representing 5.2% of the company’s quarterly revenue, remains a key clinical partner to the Personal Care and Hospice segments. Net operating cash flow totaled $22.5 million for the quarter. The company reduced its bank debt by $30 million, bringing the balance to $173 million at quarter-end, and maintained a cash position of $97 million on its balance sheet. The company averaged 105 hires per business day in Q2, supported by high adoption of its caregiver app in Illinois (90%) and expansion to New Mexico. Key Financial Figures M&A Activity On August 1, 2025, Addus acquired Helping Hands Home Care Service for $21.3 million, funded through its revolving credit facility and cash on hand. The acquisition expands the company’s Personal Care segment’s density in Western Pennsylvania and adds additional Hospice and Home Health capabilities in the region. "As we have with this most recent acquisition, our development team will continue to focus on both clinical and nonclinical acquisition opportunities that increase both the density and geographic coverage to our current states,” CEO Dirk Allison commented. Guidance Management anticipates upcoming reimbursement rate increases in Illinois and Texas to add $17.5 million and $17.7 million in annualized revenue, respectively, with low‑20% margins, effective September 1, 2025 (Texas) and January 1, 2026 (Illinois), pending federal approval. Adjusted EBITDA margin for the full-year 2025 period is expected to remain between 12% and 13%. Gross margin in Q4 2025 is expected to expand slightly due to rate increases in the Hospice segment and a reduction in payroll tax liabilities. Aveanna Healthcare (Nasdaq: AVAH) Highlights Aveanna reported Q2 2025 revenue of $589.6 million, up 16.8% year-over-year, driven by 19.2% growth in the Private Duty Services segment, 10.0% in Home Health & Hospice, and 2.2% in Medical Solutions. The Private Duty Services segment’s growth was driven by 11.1 million hours of care, a volume increase of 6.9% from Q2 2024. Reported EBITDA surged 115.3% from Q2 2024 due to an improved rate environment, increased patient volumes, and enhanced operational efficiencies. Additionally, Q2 2025 results were positively impacted by several timing-related revenue items such as annual value-based payments in the Private Duty Services segment which contributed $9 million to revenue and EBITDA. The Private Duty Services segment, which represents 82.4% of Q2 2025 revenue, saw 10 rate enhancements year-to-date and added one additional preferred payer agreement in the current quarter to bring the total to 25 preferred payer agreements, which has allowed the company to invest in caregiver wages and recruitment efforts. Preferred payer agreements accounted for 55% of Aveanna’s total Private Duty Services MCO volumes in the quarter. Key Financial Figures M&A Activity Aveanna closed its acquisition of Thrive Skilled Pediatric Care and is expecting to finalize the integration in the coming months, allowing the company to refocus on additional M&A opportunities in both the latter half of this year and the beginning of next year. CFO Matt Buckhalter highlighted enhancements to the company’s liquidity position through an extension of its securitization facility to 2028 and more favorable pricing to provide “flexibility to operate the business and invest in continued growth and future M&A.” CEO Jeff Shaner also shared an intention to lean into M&A as a growth lever in both the Private Duty Services and Home Health & Hospice segments, as well as exploring tuck-in opportunities in its Medical Solutions segment beginning in 2026. Guidance Management raised its outlook for full-year 2025 based on the strength of their Q2 2025 and year-to-date results, which includes a 2025 revenue and adjusted EBITDA target of greater than $2.3 billion and $270 million, respectively, inclusive of the Thrive acquisition. CEO Jeff Shaner reiterated a commitment to enhancing partnerships with government partners and preferred payers, identifying cost efficiencies and synergies to continue growth, and modernizing the Medical Solutions segment to achieve their target operating model. The Pennant Group, Inc. (Nasdaq: PNTG) Highlights Pennant Group reported total revenue of $219.5 million for Q2 2025, a 30.1% or $50.8 million increase year-over-year, driven by increases across all segments including a 24.3% increase in Hospice revenue, a 39.8% increase in Home Health revenue, including other Home Care revenue, and a 23.1% increase in Senior Living revenue over the prior year quarter. The Home Health segment, representing 42.0% of the business, grew admissions by 26.1%, including a 21.6% increase in Medicare admissions, since Q2 2024. Despite the CMS proposed rule cut for Home Health reimbursement, management expects little disruption given Medicare only represents 18% of their total Home Health revenue in Q2 2025. The Hospice segment, representing 33.6% of Q2 2025 revenue, saw 14.7% growth in admits along with a 21.4% and 3.3% increase in average daily census and revenue per day, respectively, over the prior year quarter. Key Financial Figures M&A Activity Pennant Group announced their purchase of divested assets from UnitedHealth Group and Amedisys as a result of their antitrust settlement with the Department of Justice. Management expects the assets to include close to 50 locations in Tennessee, Georgia, and Alabama at a purchase price between $113 million and $147 million, implying an EBITDA multiple in the 4x to 8x range. Management announced their acquisition of GrandCare Home Health on July 1, 2025, which provides Home Health services in Los Angeles, Orange, and Riverside counties in California. President and COO John Gochnour commented, "The acquisition expands Pennant's service area in a region where we have a number of senior living communities creating a unique opportunity to build a Pennant care continuum.“ Management also reiterated its commitment to growth by M&A despite recent regulatory headwinds in the Home Health space. COO John Gochnour confirmed, "The pipeline is robust. There's a lot of opportunities right now." Guidance Management raised its outlook for full-year 2025 based on positive momentum from expanded operations and upside in their existing operations. Full-year revenue is anticipated to be between $852.8 million and $887.6 million, while full-year adjusted EBITDA is expected to land between $69.1 million and $72.7 million. Enhabit Home Health & Hospice (Nasdaq: EHAB) Highlights Enhabit reported Q2 2025 consolidated net revenue of $266.1 million, up 2.1% year-over-year and 2.4% sequentially. Sequential growth was driven by an increase in average daily census across both its Home Health and Hospice segments, while year-over-year growth was buoyed by the Hospice segment’s strong performance. Home Health revenue fell 2.0% from Q2 2024 due to declining Medicare patient volumes, but the rate of decline has been steadily improving from management’s efforts to maintain a healthy payer mix. Q2 2025 admissions grew 1.3% year-over-year, or 2% when adjusting for closed branches. The Hospice segment continues its strong growth trajectory, with the company posting its sixth straight quarter of sequential census growth. Hospice revenue grew 19.4% over the prior year quarter, and management intends to continue their de novo strategy to further boost volume, with a target of ten new locations by the end of 2025. Enhabit reduced its bank debt by $10.5 million, including amortization and prepayments, and ended the quarter with a cash position of $37 million. The company is continuing with its cost savings initiatives and have successfully delivered a 6% year-over-year improvement in general and administrative expenses. By the end of Q2 2025, Enhabit has either closed or consolidated 11 branches and have indicated that an additional Home Health and Hospice branch will be consolidated by the end of Q3 2025. CEO Barbara Jacobsmeyer announced that she would be stepping down from her role as CEO, President, and member of the board of directors in July 2026 or upon the appointment of a successor. Key Financial Figures M&A Activity Management’s current focus is on deleveraging the balance sheet and have indicated that they will not be prioritizing M&A until they’ve succeeded in lowering their leverage ratio. As of quarter-end, the company has reduced its leverage ratio to 4.3x from 5.1x in Q2 2024. Guidance Management has updated its outlook for full-year 2025 which includes a revenue target between $1.06 billion and $1.07 billion, as well as an adjusted EBITDA target between $104 million and $108 million. Full-year 2025 free cash flow is expected to be in the range of $47 million to $57 million. Management reaffirmed their intention to optimize visits per episode to meaningfully offset reimbursement headwinds as a result of the 2026 CMS Home Health proposed rule. BrightSpring Health Services, Inc. (NASDAQ: BTSG) Highlights BrightSpring posted a total company revenue of $3.1 billion, representing 29% growth year-over-year, and adjusted EBITDA growth, excluding its soon-to-divested Community Living division, of 29% year-over-year, driven by strong volume growth, particularly in the Onco360 and CareMed Specialty Pharmacy businesses. The Pharmacy Solutions segment saw strong growth of 32% year-over-year driven by a 38% year-over-year increase in specialty scripts and five limited distribution drug launches within the quarter. BrightSpring was also selected as the national pharmacy partner for multiple novel therapies targeting advanced cancers and rare genetic disorders. The Provider Services segment grew 11% from the prior year quarter, led by 17% year-over-year growth in its Home Health, Hospice, and Primary Care businesses, 9% year-over-year growth in its Rehab Care business, and 4% year-over-year growth in its Personal Care business. Key Financial Figures M&A Activity The company expects to close its Community Living divesture in Q4 2025, subject to review by the Federal Trade Commission, and receive $715 million of net cash proceeds from the $835 million purchase price. CEO Jon Rousseau reaffirmed the company’s baseline inorganic growth strategy of closing 8 to 10 tuck-in acquisitions annually while they continue to wait for further news on the UnitedHealth Group and Amedisys divestiture. Guidance Management has provided an updated outlook for full-year 2025 results including an increased total revenue range of $12.2 billion to $12.6 billion, which includes Pharmacy Solutions revenue of $10.75 billion to $11.1 billion and Provider Services revenue of $1.45 billion to $1.5 billion. The updated total revenue range reflects a 21.1% to 25.1% increase over full-year 2024 when excluding the Community Living business in both years. CFO Jen Phipps commented, “Our increased total revenue guidance is primarily driven by an improved pharmacy revenue outlook, including growth in LDDs and generic drug conversion and utilization opportunities and consistent growth on the provider side.” Management also increased its adjusted EBITDA target by $20 million in each of the low and high ends of their previously communicated range to $590 million to $605 million, primarily driven by strong pharmacy growth, procurement and efficiency initiatives across both the Pharmacy Solutions and  Provider Services segments, strong provider performance, and improved profitability in infusion care. Option Care Health, Inc. (NASDAQ: OPCH) Highlights Option Care reported $1.4 billion in Q2 2025 revenue, which represents a 15% increase over the prior year quarter, underpinned by mid-teens growth in both their acute and chronic portfolios of therapy. The company highlighted that their growth in acute therapy was notably higher than the growth rate of the overall market, emphasizing strong execution in adapting to shifting industry dynamics. Gross profit grew 8% year-over-year to $269 million, but the margin rate was negatively impacted by some lower-margin services including limited distribution drugs and rare and orphan therapies, however, management are encouraged by these services’ contributions to their gross profit on an absolute dollar basis. Option Care generated over $90 million in net operating cash flow in Q2 2025 and expects to generate over $320 million in net operating cash flow in the full-year 2025 period. Key Financial Figures M&A Activity Management continued to emphasize thoughtful M&A activity as a key lever for growth. CEO John Rademacher commented, “Our commitment to shareholders has always been that it will be both strategic and economic when we're evaluating where we deploy your capital in those type of activities. And therefore, I think you'll see us in a very disciplined way, continue to look for opportunities to utilize the strength of the balance sheet in ways that will enhance value for our shareholders.” The company also reiterated its commitment to M&A in its SEC filings writing, “Our business strategy includes the deployment of capital to pursue acquisitions that complement our existing operations. We continue to evaluate acquisition opportunities and view acquisitions as a key part of our growth strategy.” Guidance Option Care raised its full-year 2025 outlook as a result of strong Q2 2025 results and balanced growth across its entire portfolio. The company raised its revenue guidance to $5.5 billion to $5.65 billion and its adjusted EBITDA guidance to $465 million to $475 million. Management expects their new revenue and adjusted EBITDA targets to result in an adjusted earnings per share between $1.65 and $1.72. The company does not expect a material financial impact in full-year 2025 from potential tariffs, MFN pricing, and similar policy changes. To download the .pdf version of this report, click below. Disclaimer The information contained in this document is provided for informational and marketing purposes only by Mertz Taggart and is not intended as investment, financial, legal, tax, or other professional advice. The content has been compiled using publicly available sources, including but not limited to SEC filings accessed via EDGAR, Seeking Alpha, and Yahoo Finance.  While we strive to ensure the accuracy and reliability of the information presented, Mertz Taggart does not warrant or guarantee the completeness, timeliness, or accuracy of the information, nor shall it be held liable for any errors or omissions.  This document does not constitute a solicitation, recommendation, or offer to buy or sell any securities or other financial instruments. Any views or opinions expressed are those of the author(s) and do not necessarily reflect the views of Mertz Taggart or its affiliates. Recipients should not rely solely on the information herein for making investment or strategic decisions. All readers are encouraged to conduct their own independent research and to consult with their professional advisors before making any financial or business decisions. 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Behavioral Health M&A The 31 total behavioral health transactions were announced in the second quarter of 2025 -- the fewest reported since the onset of the COVID-19 pandemic – but a closer look at the numbers reveals a new dynamic…. a slowdown in growth deals. “Since the pandemic, there has been a venture capital rush into early-stage mental health companies,” Mertz Taggart Managing Partner Kevin Taggart said. “We knew the sheer volume of transactions was not sustainable. I wouldn’t be surprised if this is the beginning of the slowdown for growth transactions. We saw an average of 13 growth deals per quarter over the past 3 years. In Q2, we tracked a total of five.” Note: Total industry transactions do not necessarily equal the sum of the sub-industries, as many transactions include more than one sub-industry. Traditional M&A volume was down slightly, with 26 transactions recorded. While this is down from the 35 transactions recorded in Q1, it is in line with the post-pandemic norm. “We are seeing a trend of fewer deal announcements,” Taggart commented. “Private equity’s push into healthcare has been under public and regulatory scrutiny over the past 12-24 months.  Many of these groups would prefer to keep these transactions under the radar to the extent they are able. It’s not an attempt to avoid regulators, but rather, they don’t see the benefit in announcing.” Addiction Treatment M&A A total of nine deals—seven M&A transactions and two growth deals—were reported in the addiction treatment subcategory in Q2, matching the previous two quarters. Major players remaining in a holding pattern has kept deal volume in the addiction treatment subcategory at a slower pace, said Taggart. “Some very notable, big-name buyers have been choosing to remain on the sidelines,” Taggart said. “But we’re starting to see a couple come back, so that’s encouraging. We’ll see how that plays out over the next couple quarters.” Among the transactions involving addiction treatment provider organizations that were reported in the second quarter were the following private equity platform deals: Perimeter Healthcare , a portfolio company of Ridgemont Equity Partners, was acquired by a family office. In April, Clearview Capital Fund V and its affiliates announced the recapitalization of Laurel Springs, New Jersey-based  Advantage Behavioral Health  and affiliates. Other Q2 deals in the addiction treatment subcategory included the following: Porch Light Health  in Colorado acquired Comprehensive Behavioral Health Center , an opioid treatment program (OTP) with clinics in Denver and Lakewood, Colorado. The deal allows Porch Light Health to now offer a full spectrum of medication-assisted treatment options. T&R Recovery  closed on a non-controlling investment from   Genesis Park, through its investment fund, GP Capital Partners, and Cyprium Partners, through its investment fund, Cyprium SBIC. Oar Health , a provider of alcohol addiction treatment services, received a $10 million investment from IAC Inc., a New York-based holding company. Rosecrance Health Network announced its acquisition of North Central Behavioral Health Systems  in central Illinois. Butler Behavioral Health  and Best Point Education and Behavioral Health , a pair of Ohio-based not-for-profit behavioral health organizations, announced a merger in June. Per terms of the deal, Butler will operate as a wholly owned subsidiary of Best Point. The companies will operate with a combined annual revenue of $65 million. Mental Health M&A Mental health continued to lead the way in terms of behavioral health transactions in Q2, accounting for 21 of the 31 deals announced overall. Eight transactions involving mental health providers were private equity-backed strategic deals. Shreveport, Louisiana-based  Seaside Healthcare  sold off its two major behavioral health divisions in separate deals. In one transaction, The Graph Group acquired Seaside’s acute and intermediate behavioral health services. In addition to the sale of its acute and intermediate behavioral health services, Seaside Healthcare ’s outpatient therapy services were sold to SUN Behavioral Health . US Pediatric Partners  in North Carolina acquired Hope Services , a provider of community-based mental health and care management services with three locations in the greater Raleigh, North Carolina, area. PAX Health , a behavioral health company backed by HCAP Partners and funds managed by Hamilton Lane, acquired Richardson Psychiatric Associates . Valor Healthcare , a provider of federal healthcare services, acquired Mission Critical Psychological Services , which provides telehealth-based care for federal government agencies, government contractors, and first responders. Valera Health  expanded its presence in digital psychiatry with its acquisition of suicide prevention startup Vita Health . The move positions Valera to advance its value-based care contracting and other payment efforts, according to a media report . Nashville, Tennessee-based Acute Behavioral Health , a provider of services for young people, completed an acquisition of Nova Behavioral Health ’s Oakwood Treatment Center , a residential treatment facility for young people and their families in Kinston, North Carolina. Other Q2 deals in the mental health subcategory included the following: Teledoc  increased its investment in virtual mental healthcare with its acquisition of UpLift  in a $30 million, all-cash transaction. Sword Health , a digital pain management startup, announced a $40 million funding round led by General Catalyst. Digital mental health platform Kindbridge Behavioral Health  announced that it has raised $5.4 million in a multi-year funding round that began in 2022. Noma Therapy  announced a $4.25 million funding round to support an expansion of its virtual psychiatry services, including ketamine-assisted therapy. Autism and Intellectual/Developmental Disabilities M&A While overall deal volume in the subcategory of intellectual/developmental disabilities (I/DD) and autism services dropped to seven transactions in Q2 from the 12 reported in the previous quarter, there was an increase in private equity-backed strategic deals. Five PE-backed strategic deals were announced in the second quarter, including the following: Shorehaven  was acquired by Sevita , a Minnesota-based home- and community-based healthcare company previously known as The Mentor Network and Civitas Solutions Inc. Alongside ABA , formerly known as Autism Spectrum Interventions, expanded its footprint in Southern California with its acquisition of San Diego Applied Behavioral Analysis . Active Day  expanded its presence in the I/DD services market with its acquisition of PremierCare Consulting , which is contracted with the Illinois Division of Developmental Disabilities to provide person-centered planning and case management. Abound Health  expanded its service offerings in North Carolina with an acquisition of Heartspring , a provider of mental health and I/DD services in the Charlotte area. Among other deals reported in Q2, Behavior Frontiers , a national provider of autism therapy services, announced its sale to NexPhase Capital, a private equity firm with experience in autism therapy, healthcare and software development. If you would like to download this report in a PDF file, click the link below.

Despite macroeconomic uncertainty on many fronts, home-based care M&A activity overall remained steady in the second quarter, buoyed by non-medical home care. A total of 26 deals involving home-based care providers were announced in the quarter. Non-medical home care accounted for 15 transactions. Of those deals, nine involved sponsor-backed portfolio companies, many of which are Medicaid and Veterans Affairs providers across multiple states. Home-Based Care M&A Note: Total industry transactions do not necessarily equal the sum of the sub-industries, as many transactions include more than one sub-industry. “Non-medical home care M&A is having its time,” Mertz Taggart managing partner Cory Mertz said. “We have more clarity around the OBBBA, and its impact on non-medical home-based care will be less than many feared. The DOL’s proposed return of the companionship exemption, and multiple portfolio companies gearing up for an exit in the next several months will also serve as catalysts.” In contrast, home health and hospice have both seen slower activity, but for different reasons.     Home Health M&A   A total of seven skilled home health transactions were announced in Q2, roughly on par with the eight deals reported in the previous quarter. Among them, Aveanna  announced in June that it has completed its $75 million acquisition of Thrive Skilled Pediatric Care , an independent provider of pediatric home health with 23 locations in seven states. Summit Partners exited the deal after a hold period of more than nine years.  Four home health provider deals were of the sponsor-backed strategic variety. BPEA-backed LiveWell Partners  closed on its acquisition of Empower Home Health Services . Based in St. Louis, LiveWell is a home health and hospice provider currently operating in Illinois, Kansas, Michigan, Missouri and Ohio. Founded in 2005, Empower is a privately owned home health company that operates in nine counties in the Chicagoland area. DispatchHealth  announced the close of its merger with Medically Home . The combined company will operate under the DispatchHealth brand. The recently proposed rule from the Centers for Medicare and Medicaid Services, which includes a rate cut of 6.4% and would take effect in January 2026, will have an impact on M&A over the next few months. Mertz characterized the proposed cut as “very disappointing, but not a huge surprise." Uncertainty over the final rule, which will be published in November, and which recent history suggests won't be as onerous as the proposed rule, will likely impact some of the transactions currently in the works. In summary, “The transaction volume we are seeing in home health doesn’t match demand,” said Mertz. “Buyers are eager to deploy cash into quality, skilled home health assets, but are mandated to do it in a more strategic, disciplined manner than in years past. Quality assets that have gone to market recently have enjoyed strong valuations. We expect this to continue." Hospice M&A A total of five hospice transactions were announced in the second quarter, a slight dip from the seven deals reported in Q1 .  Chapters Health System , a not-for-profit chronic illness care organization, finalized its affiliation with Nathan Adelson Hospice , based in Las Vegas, a move the organization said marks its first official step in the growth of its Chapters Health West division, which also includes agencies in California and Oregon. Cressey & Company announced a partnership with Paradigm Health . Paradigm management, along with the company’s existing investor, Havencrest Capital Management, also made investments as the company pursues its next phase of growth. Despite strong demand, deals have proven difficult to get to the closing table. Diligence around billing and compliance have caused many proposed deals to fall apart. Buyers are fearful of Medicare clawback risk, a concern that is amplified in four “enhanced oversight” states—California, Arizona, Nevada, and Texas. As such, Mertz Taggart continues to strongly recommend that providers considering a transaction in the next 24 to 36 months first invest in a billing and compliance audit.  “We are strongly recommending a pre-market audit for operators, especially in those four states,” Mertz noted. “It’s important to use a group that will quantify the clawback risk specific to those four states, considering the current enhanced oversight environment.” Home Care M&A Home care saw 15 total transactions announced in Q2, including nine private equity-backed strategic deals. Active Day  and Help at Home  were at the forefront of this activity. Backed by the Audax Group, Active Day  acquired three more home care providers, including All Caregivers  and New Generations Home Care of Florence . These acquisitions help solidify Active Day’s existing strategy of pairing its current adult day opportunities with non-medical home care. “These acquisitions are highly complementary to Active Day’s existing adult day centers in South Carolina and expands on our continuum of home and community-based services,” said Matt Donnelly, CEO of Active Day. Vistria Group-backed Help at Home  closed on three transactions in the quarter. In April, they announced the acquisitions of two Indiana-based agencies— LovAbility   Home Care  and BB’s Heaven on Earth Home Care Services . They followed in mid-May with a deal to acquire Home Care Now of Central Florida . Mertz Taggart has tracked 12 transactions by Help at Home over the past 12 months.  Other home care transactions for Q2 included the following: HomeCentris Healthcare , a Spring Capital Partners portfolio company and the largest Medicaid home care provider in Maryland, completed the acquisition of First Family Home Healthcare  in Philadelphia.  MedTec Healthcare , a provider of in-home care and adult day services in Illinois, was acquired by the private equity firm Waud Capital Partners  through its holding company, Altocare . MedTec will join home care franchisor Senior Helpers  under the Altocare umbrella. Havencrest Capital Management  announced its sixth and seventh acquisitions by its Avid Health at Home  platform, boosting its presence in the Chicagoland area with a deal for Home Care Angels and in Michigan with its acquisition of Private Duty Home Healthcare . Martis Capital-backed Amivie  (formerly Community Based Care), a provider of home and community-based care services in six states, announced a partnership with Minnesota-based Cherish . If you are interested, you can also download the .PDF version of the Q2 2025 Home-Based Care M&A Report via the following link:

After reaching a nadir in 2024, the tides have turned in home-based care M&A. Whether the turnaround is a single wave or a full, long-term sea change remains to be seen. A total of 29 home-based care transactions were reported in the first quarter of 2025, making it the most active quarter for the industry since 2023 and a return to pre-pandemic levels. Home-Based Care M&A Note: Total industry transactions do not necessarily equal the sum of the sub-industries, as many transactions include more than one sub-industry. While it's hard to predict whether deal volume will hold through year-end, Mertz Taggart Managing Partner Cory Mertz points to a key driver: aging private equity funds with significant dry powder. These funds are eager to deploy capital into both platform deals and bolt-on acquisitions for existing portfolio companies. “We’re starting to see some deals finally get across the finish line,” Mertz said.  “Several deals that were slated to close in 2024 were ultimately pushed into Q1 of 2025. Deals are just taking longer to get done. Buyers are hungry, but they remained very disciplined in their investment approach.” Potential cuts to Medicaid will be a development to watch in the coming months. The Trump administration has signaled its desire to reduce federal costs via Medicaid spending, and the U.S. House recently passed a budget resolution targeting Medicaid cuts of up to $880 billion over the next decade. Detailed proposals for achieving the spending cuts are not yet under consideration in Congress.  This headline risk is enough to give many investors outside the industry pause on any platform opportunities, however existing industry buyers remain resolute in their approach, which culminated in a strong Q1 for Medicaid-funded personal care.  Home Health M&A   Eight transactions involving skilled home health providers were reported in Q1, up from the three announced in the prior quarter. Despite the ever-growing clawback risk from CMS’ perceived overpayments related to PDGM (currently at an estimated $4.5 billion), the uncertainty level is low enough for Medicare home health to continue to garner investment interest. “I’d say home health demand is fairly strong right now,” Mertz commented. “On a scale of 1-10, demand is at about an 8, but buyers are laser focused on deals that move the needle strategically. The risk and uncertainty levels are relatively low, and it remains central to most strategic buyers’ value-based care strategies.” The most notable home health transaction of Q1 was Pennant Group’s  (NASDAQ: PNTG) finalizing its two-stage, $80 million acquisition of Signature Healthcare at Home , adding its Oregon operations to the previously closed Washington and Idaho locations.  Providence , a not-for-profit health system, and Towerbrook- and Ascension-backed Compassus , a provider of home-based care services, announced the formation of a joint venture for home health, as well as hospice, community-based palliative care, and private duty caregiving services. The new entity is operating as Providence at Home with Compassus , with 24 home health locations and 17 hospice and palliative locations across four states, and private duty operations in Southern California. DispatchHealth  announced in March that it had reached an agreement to acquire Medically Home , “extending care into patients’ homes across 50 major metropolitan areas in collaboration with nearly 40 health systems and most major health plans and value-based care organizations,” according to a Home Health Care News report . DispatchHealth is backed by a consortium of venture sponsors, led by Optum Ventures. Baptist Health  announced the formation of a joint venture with Midwest-based home health provider Alternate Solutions Health Network to expand services across Kentucky, southern Indiana, and southern Illinois. Renovus Capital Partners , a lower middle-market private equity firm, announced a strategic partnership with Superior Health Holdings . The platform deal enables Superior to expand its home health and hospice services in Louisiana and into neighboring states. A Florida-based multi-location home health provider was acquired by an independent sponsor. Details remain confidential. Hospice M&A Hospice volume is up slightly, but still down the most of the three categories within the home-based care sector, relative to the bubble of 2021. Seven deals were announced in Q1, up from five the prior quarter. Demand remains very strong for hospice, but getting deals closed has been challenging. Buyers are rightfully nervous about potential risk for Medicare clawback because of poor billing documentation, Mertz said. “We’ve been advising owners to get a billing audit done before they go to market,” Mertz said. “If you’re considering a sale anytime in the next three years, get an audit done now.This will give you time to make the appropriate adjustments, if necessary, to limit the potential clawback exposure for the ultimate acquirer.” The following hospice deals were announced in Q1: Bristol Hospice , a portfolio company of the private equity firm Webster Equity Partners, acquired St. Agatha Comfort Care  in Las Vegas for an undisclosed sum.   Choice Health at Home remained active and expanded its services in Texas with its acquisition of Devotion Hospice . The deal was another step in Choice’s efforts to provide a home-based continuum of care in each of its Southwestern-based markets. Minnesota-based St. Croix Hospice  expanded its footprint in the Midwest with a pair of deals. St. Croix acquired Hospice of Siouxland in Iowa and some of Mayo Clinic Health System’s hospice assets in Minnesota. Financial terms of both deals were not disclosed, according to Hospice News . Uplift Hospice  acquired Star of Texas Hospice , expanding its average daily patient census to 450 across Arizona, Nevada, and Texas.  Home Care M&A Any uncertainty stemming from the potential cuts to Medicaid spending is not deterring strategic buyers. A total of 17 home care transactions were announced in Q1, doubling up on the total from Q4 2024 . Of the 17 deals announced, 11 were funded by Medicaid, across 10 states with nine different sponsor-backed strategic buyers. The following deals were announced in Q1: Peak Rock Capital , a middle-market private equity firm, completed its acquisition of BrightStar Group Holdings , a franchisor of home care services with more than 400 agencies nationwide. Choice Health at Home  bolstered its continuum of care for patients in Texas, Colorado, and the Southwest by acquiring Family Tree Private Care . HouseWorks, an InTandem Capital portfolio company , expanded its footprint in Massachusetts with the acquisition of O’Connell Care at Home  in Springfield and Best Home Care, which serves the Greater Boston area. New Day Healthcare  made two deals to strengthen its presence in the Houston area. First, it acquired Christian Senior Care Services , it then acquired Patient Recovery Home Healthcare Services . Mertz Taggart provided exclusive M&A advisory services to this transaction, representing the seller. CareGivers of America announced a deal to acquire Florida-based Platinum Select Care . Martis-backed Community Based Care , which provides services in six states, expanded its portfolio with its acquisition of TLC At Home  in Albemarle, North Carolina. Family Matters In-Home Care  acquired Homecare California , with the latter set to take on Family Matters’ name and brand in the coming months. Great Point Partners’ Family Resource Home Care announced a deal to acquire Beneficial In-Home Care , which operates six home care agencies in eastern Washington. Gracepoint Home Care  in Mobile, Alabama, announced that it has acquired the assets of Touching Hearts Senior Care . A large Midwest adult day and HCBS provider sold to a financial sponsor. Mertz Taggart provided exclusive sell-side advisory services in this transaction.   VNS Health , a not-for-profit home- and community-based health care company, acquired Alliance Home Services , which serves the Bronx in New York. If you are interested, you can also download the Q1 2025 Home-Based Care M&A Report via the following link:

Insights from David Jackson, CEO of Choice Health at Home Mertz Taggart recently launched its “Behind the Curtain” webinar series , aimed at providing agency owners with a transparent look at the inner workings of healthcare M&A. In our first session, David Jackson—Founding Partner & CEO of Choice Health at Home—shared his playbook for sustainable growth and acquisition success. Joined by Mertz Taggart’s Cory Mertz and Michael Lloyd, Jackson detailed what strategic buyers are really looking for in today’s market—and how operators can position themselves for a premium outcome. "If you're driving toward quality, you're already driving toward value-based care."  – David Jackson, CEO, Choice Health at Home From Therapist to CEO: Building a Scalable Healthcare Platform Jackson’s journey began as a physical therapist inspired by personal family experiences. That early passion led to the founding of a rehab business in 2007, which evolved into today’s Choice Health at Home —a diversified provider spanning home health, hospice, personal care, and rehab, with thousands of employees across seven states. “We started with three credit cards and a bad line of credit. But we had a vision—to deliver care in the home and build something that lasts.”  – David Jackson What Buyers Like Choice Health At Home Look For Whether you're preparing to sell now or positioning for a few years down the road, here’s what stands out most to strategic buyers like Choice: Compliance First Buyers conduct compliance audits before anything else. A history of failed audits or unclear documentation is often a dealbreaker. “Compliance precedes everything else. If there’s a red flag, it’s a non-starter.”  – David Jackson Quality Metrics That Matter From HHVBP performance to CMS star ratings, quality metrics directly affect enterprise value. Jackson emphasized that quality and financial health are closely linked. Well-Organized Financials Accrual-based accounting, clean P&Ls, and clearly defined gross margins are critical. Jackson cautioned that “cash-based” books create complications during diligence. “Get your financials in order. $2,500 a month with a good accountant could be the best investment you make pre-sale.”  – David Jackson Sustainable Payer Mix Buyers expect your payer mix to align with your market. If you are in a market dominated by Medicare Advantage, yet 90% of your revenue comes from traditional Medicare, it can be concerning. Home Health, Hospice, and Personal Care: Tailored Strategies for Each Sector Jackson broke down his acquisition lens across each of Choice’s three core service lines: Home Health Top priorities:  Compliance, CMS quality scores, gross margin structure, and alignment with local payer trends. Bonus:  Regional density can command a premium. “Home health remains the most viable vehicle for reducing re-hospitalization and delivering care at the lowest cost.” Hospice Focus:  Regulatory compliance is the #1 challenge in today’s transactions, especially in enhanced oversight states like Texas, Arizona, Nevada, and California. Outlook:  AI is creating real opportunities to automate compliance workflows and pre-screen documentation. Hospice Enhanced Oversight States (2024) “We’re excited about AI’s ability to audit 100% of our hospice charts. Compliance in this sector is everything.” Personal Care Challenges:  Labor compliance, Medicaid rate uncertainty. Strategy:  Diversification. Choice maintains a 60/40 Medicaid-to-private-pay mix to protect against policy swings. “We want to care for people, regardless of what the government hands us. Being diversified helps us do that.” David Jackson, Founding Partner & CEO, Choice Health at Home The Value of Using an Advisor As a buyer who has executed 20 transactions since recapitalization, Jackson had some clear advice for founders: “You’ve built something valuable. When it’s time to sell, get help. A good advisor can prepare you, manage the process, and protect your interests.” He added that some of Choice’s most successful deals came after initially being a backup bidder—only to win the deal when others fell short. Looking Ahead: Growth in the Southwest and Beyond Jackson and his team at Choice remain active buyers, with a current focus on home health and personal care assets in the Southwestern U.S. But their disciplined approach to building density, scalability, and long-term value will resonate in any geography. “We're not just buying businesses. We're building infrastructure for the next decade of care.” Watch the Full Webinar Catch the full discussion between David Jackson, Cory Mertz, and Michael Lloyd for deeper insights: 👉 Visit this link .

As part of our Behind the Curtain  webinar series , we’re committed to giving agency owners a transparent, unfiltered view of what drives M&A activity in home-based care. In our most recent session, we welcomed Rich Keller , CEO of PurposeCare , to share his perspective on what strategic buyers value most—and how operators can position themselves for success in today’s market. Hosted by Michael Lloyd  and Cory Mertz  of Mertz Taggart, the conversation covered everything from payer dynamics and deal structure to what makes PurposeCare walk away from a deal. The PurposeCare Playbook Founded with a mission to deliver integrated, patient-centered care, PurposeCare is a rapidly growing provider operating across multiple states with a focus on the dual-eligible population. The company, backed by Lorient Capital , provides a combination of home care, home health, and primary care  services to underserved populations. Keller emphasized PurposeCare’s focus on markets where they can build density and serve complex patients effectively. “We’re not just looking for one-off assets—we’re looking to create a care ecosystem,” he said. What Makes a Deal Attractive? When evaluating acquisitions, Keller outlined several important criteria: Trust is Key Keller emphasized the importance of shared values: “Culture matters… The most successful deals we’ve had have been when we established trust with the owners out of the gate.” Clean Operations and Scalable Infrastructure PurposeCare seeks companies with robust, compliant systems and scalable infrastructure already in place. Keller made clear: “Our ability to be successful in acquiring companies isn't just to acquire companies... the key to us is we're going to want to integrate that company into our business.” Strategic Market Selection and Payer Partnerships PurposeCare’s evaluation of payer mix goes beyond just reimbursement types—it’s deeply tied to the regulatory and market landscape in each state. Indiana, for example, stood out as a strong fit. He explained that while the state’s shift to managed care could be seen as a disruptor for some, PurposeCare views it as a strategic opportunity:   “We think that that's actually not a bad thing for us, because it's a chance to partner with payers in a way that's a little bit more creative than you can do in just straight Medicaid.” By targeting markets where they can form deeper, more flexible payer relationships, PurposeCare positions itself to serve complex populations more effectively—especially dual-eligibles. This market-by-market approach is key to sustaining growth and integration across their care model. Walking Away from a Deal Keller was candid about the types of issues that can give buyers pause—or stop a transaction altogether: State-by-State Medicaid Complexity: “If you're in Medicaid, you've seen one state… So they're all different.” PurposeCare evaluates markets carefully and will walk away from those with regulatory uncertainty or payer dynamics that don’t align with their model. Leadership Uncertainty: “We like to work with founders. The owner helps us through a transition and allows us to learn from them and their leadership team.” Lack of a strong leadership team—or unclear expectations from the seller—can derail buyer confidence. Preparation Gaps: “Think about it through the eyes of the entity that wants to purchase you... What are they going to value? What are the skeletons in the closet? Get them out.” If an owner hasn’t addressed internal issues—operational, financial, or compliance-related—it’s likely to show up in due diligence. Sector-Specific Priorities PurposeCare evaluates acquisitions based on the specific home-based care sectors involved: Home Health Clinical quality and CMS ratings are top concerns. Consistent documentation and scalability are essential. Home Care Labor compliance and caregiver retention are critical. Integration potential with clinical services is highly valuable. Primary Care Integration Clinical governance and data-sharing capabilities are key considerations, especially for managing high-risk populations. Deal Structure Preferences Rather than generalizing about deal mechanics, Rich Keller emphasized the importance of minimizing disruption while integrating acquired agencies into the PurposeCare platform: “We try to do it in a manner that creates as little disruption as possible. But we're going to put a PurposeCare fingerprint on it.” He also underscored the importance of seller involvement during the transition, particularly when acquiring founder-led businesses: “We like to work with founders. The owner helps us through a transition and allows us to learn from them and their leadership team.” Advice for Sellers Keller’s advice to agency owners considering a transaction was both simple and strategic: “Know your numbers, know your team, and know what you want out of the deal.” He encouraged sellers to spend time preparing—cleaning up their books, investing in staff retention, and working with advisors who understand their business model and goals. “The more prepared you are, the smoother and more valuable the process will be,” he said. Looking Ahead: Growth Through Integration PurposeCare’s future growth strategy remains focused on high-need markets, emphasizing integrated care delivery. Keller articulated this forward-looking approach clearly: “How do we leverage our position in the home on the home care side and the personal care services space to get in front of changes in condition on a pre-acute basis and treat them on an acute basis, and really keep people out of the hospital?” Final Thoughts Rich Keller’s session offered a clear and compelling look into how strategic buyers approach acquisitions in the home-based care space. His emphasis on values, operational readiness, and long-term integration aligns with the themes we continue to see in the market. Whether you’re actively preparing for a transaction or just beginning to think about your future, Keller’s insights are a valuable resource for understanding how to stand out to the right buyer. 👉 To watch the recording of the full webinar, visit: https://www.mertztaggart.com/behind-the-curtain Are you contemplating a sale of all or a portion of your healthcare services company? Arrange a confidential discussion with our M&A experts via info@mertztaggart.com