One of the most fascinating questions surrounding the Centers for Medicare & Medicaid Services’ (CMS) home health proposed payment rule is what effect it will have on M&A. 

I’ve heard that it will stymie acquisitions. I’ve heard it will drive them.

Both make sense, too. Some companies may not be allocating more resources and money to the home health side of the house – assuming they have more than one service line – while other, larger companies may take advantage of the margin squeeze that cuts put on smaller operators.

On the other end, some sellers may want to get out of the space given the lack of earnings power they may have moving forward. At the same time, they may not want to sell their businesses when valuations are lower than they have been of late.

This is all contingent on what actually comes in the final rule in October, of course.

But once the rule is finalized, things could move quickly at the end of the year. We may enter 2023 with a completely different home health landscape than we did when we entered 2022.

In this week’s exclusive, members-only HHCN+ Update, I examine what the M&A environment may look like post-final rule, and what companies are saying about their own strategies as the final rule nears.