Navigating 2025: Key Trends Shaping the Home Health & Hospice Industry

So far in 2025, the home health and hospice industry continues to experience ongoing consolidation, policy shifts, and increasing demand for care. Despite market turbulence, the sector remained resilient in the first quarter, with several transactions and organic growth. Below is an overview of the key trends that providers, investors, and stakeholders should monitor. 

M&A Activity and Valuations Remain Resilient 

Even in a challenging market, mergers and acquisitions (M&A) in the first quarter of 2025 have been notably robust within the sector. High-performing companies—those with strong financial results, significant market presence, and diversified payer mixes—continue to attract considerable interest from buyers.  

Notable transactions include: 

• Aveanna Healthcare’s acquisition of Thrive Skilled Pediatric Care 

• Levine Leichtman Capital Partners’ acquisition of Synergy HomeCare 

• Renovus Capital Partners’ acquisition of Superior Health Holdings 

• Addus HomeCare’s acquisition of Gentiva’s personal care business 

The sustained strength of valuation multiples in these deals underscores the investment potential of the industry. 

Policy Changes and Reducing Risk 

While M&A activity remains high, operators and investors are focusing on strategies to mitigate risks associated with policy shifts. Diversifying the payer mix is one core approach, where organizations pursue contracts with various payers such as federal and state programs, private insurers, and private pay clients, to enhance stability. 

Staying up to date on changes in licensing and regulations—including training mandates and documentation standards—is also crucial to reducing operational risk.  As a result, we are seeing leaders devote resources to improving processes to ensure that regulatory updates are implemented quickly and effectively, ensuring companies remain competitive in the market. 

Diversifying Services and Deepening Client Base 

Expanding and diversifying service offerings remain key strategies for companies to differentiate themselves in the market. We are seeing companies add additional lines of business such as specialized therapies, home medical equipment, and telehealth services. 

Building a robust referral network likewise insulates companies from specific policy changes, reimbursement contracts, and coverage shifts, while also enhancing their reputation and brand. By optimizing high-value referral sources like hospital discharge planners, physicians, medical practices, and senior living communities, organizations are growing their client bases.  

Scaling through Technology 

Automation and AI continue to be indispensable for home care and hospice providers. For caregivers, platforms that streamline certification tracking are reducing administrative work, improving the caregiver experience. In revenue management, coding and the identification of documentation gaps are being automated, ensuring compliance and minimizing audit risks. In care delivery, remote monitoring tools and AI-driven scheduling algorithms are providing real-time patient data and optimizing caregiver assignments, removing complexity while improving efficiency, accuracy, and scalability. 

Amid headwinds, the home health and hospice industry in 2025 has demonstrated meaningful M&A activity and resilience amid both policy and market shifts. Providers and investors who proactively adapt to these trends—by diversifying payer mixes, expanding service offerings, and embracing technological advancements—are well-positioned to navigate the evolving landscape and capitalize on emerging opportunities.