M&A activity for in-home care providers jumps up in third quarter

M&A activity for in-home care providers jumps up in third quarter


The firm attributes the higher volume to sellers trying to unload properties before potential capital gains tax increases next year. The Biden administration has proposed increasing the tax rate on long-term capital gains to 43.4% from 23.8%.

“The Biden administration came out of the gate with some pretty draconian targets,” Mertz said. “The current Build Back Better reconciliation package is still in negotiations, but it appears to be much less severe than the original targets.”

The COVID-19 pandemic also could be encouraging sales, the company said.

“We’ve heard from many owners who are feeling a sense of burnout,” Mertz said. “Maybe they were already thinking about a sale in the next couple of years, but then the ongoing pandemic just accelerated their timelines.”

Among other things, the pandemic has exacerbated existing workforce challenges in home health, hospice and home care, resulting in operational difficulties for owners. A recent study by consulting firm PHI and the Health Workforce Research Center on Long-Term Care at the University of California San Francisco found that “an immeasurably small number of workers” who were laid off from roles comparable to direct care entered the direct care workforce.


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