Mission buys Wholesome Residing Community, successfully doubling its total enterprise
Mission Healthcare announced Wednesday that it has acquired Healthy Living Network, a multi-state home healthcare provider founded over a decade ago.
The deal marks the largest acquisition in the history of the San Diego-based mission, CEO Paul VerHoeve told Home Health Care News. In addition, by joining forces with the Healthy Living Network, Mission is effectively doubling its overall business and cementing its position as a true regional home health player in a rapidly consolidating industry.
“We had ongoing discussions with them and found that the cultures of our two organizations are very similar and that both organizations share many common strengths,” said VerHoeve. “We felt that the combination would really enable us to make a positive impact on the care we offer in each of our communities.”
Not long ago, the Vistria Group-supported mission was a home health, hospice, and palliative care provider with locations across California. However, VerHoeve and his team had already set their sights on cross-state expansion in early 2021.
The mission was carried out in June through the acquisition of the Silverado Hospice, located in Salt Lake City, Utah.
“It was sort of our first out of state market that we started serving,” VerHoeve said.
With the establishment of the Healthy Living Network, Mission will become one of the largest home care providers on the West Coast, serving more than 5,000 patients daily at 36 locations. In addition to California and Utah, Mission now also includes Arizona, Nevada, Oregon, and Washington.
The Healthy Living Network previously had a headquarters in Northern California.
The company is made up of independent and operated home health agencies that provide medical, rehabilitation and support services at home. The individual providers include Advanced Healthcare Services, Compass at Home, Healthy Living at Home and Onecare Home Health.
“By joining Mission, we are bringing together two companies with complementary skills and opportunities for employees across the network,” said John Cullen, CEO of Healthy Living Network, in a press release. “We’re also excited to build on Mission’s reputation for delivering exceptional quality of care and service to patients, their families and referring partners while keeping their staff at the center of their actions.”
VerHoeve declined to comment on financial details but stressed the importance of this deal to Mission.
“It is fair to say that the combined organization really doubles both organizations,” he added. “Of course, we also made other acquisitions in advance of this acquisition that further increased our patient count and the number of people we care for on a daily basis.”
The strategic advantages of “density”
Mission and Healthy Living Network will be fully integrated in the coming weeks, with Cullen and other local executives remaining to lead the joint business. As of this writing, there are no plans to rename any of the Healthy Living Network providers.
This is in part to maintain the trust and familiarity that Mission and Healthy Living Network have gained in their respective fields, VerHoeve explained.
“We personally don’t see the benefit of rebranding under one name,” he said. “That can confuse the market. It can confuse the employee base. We will allow all locations to continue to operate under the brand under which they currently operate. “
In the end, Mission was actively seeking growth and seeking high quality home health opportunities. But the Healthy Living Network didn’t exactly buy in, despite the hot M&A market for would-be sellers.
Home health and hospice companies have had the highest multiples in healthcare for at least two consecutive years, according to a June report by PricewaterhouseCoopers.
Instead, Mission and Healthy Living Network came together more or less naturally, VerHoeve said. He had known Cullen for “a long time,” with his company and the Healthy Living Network formed around the same time.
“He and I had some very early discussions about what they were doing and what we were doing, and we were just really trying to ask each other what was happening, especially since we were operating heavily in the same state of California,” he said. “These conversations evolved into the question of ‘Could we ultimately bring the two companies together?'”
According to VerHoeve, there are two main benefits to being a greater family doctor.
First of all, by adding new services and locations, Mission enables more efficient maintenance and thus also the support of employees. In addition, a high density in a particular region also helps when talking to insurance companies, health systems and other potential partners.
“We see this as a great opportunity to really be a meaningful partner to payers and others,” said VerHoeve.
HCAP Partners was Mission’s former PE backer, with Chicago-based Vistria Group stepping in to support the vendor’s continued growth towards the end of 2020. Vistria has been a “great partner” in facilitating Mission’s recent transactions, VerHoeve noted.
There will likely be more mergers and acquisitions on the horizon as well, with Mission hoping to have multiple locations in each of the states in which it operates, the CEO said.
“We believe density really has a direct impact on patient care,” said VerHoeve. “You know, having a location or two in a state isn’t necessarily where we want to end up. We would like to have multiple locations with multiple service lines in each state we operate in. “