BATON ROUGE, Louisiana, and NASHVILLE, Tennessee (July 1, 2021)—Home health, hospice and personal care company Amedisys, Inc. (NASDAQ: AMED) announced that it has signed a definitive agreement to acquire Contessa Health, a provider of hospital-at-home and skilled nursing facility (SNF) at-home services, in a $250 million deal. In addition, Amedisys plans to invest in the future growth of Contessa’s business and proprietary informatics platform, CareConvergence. Upon closing of the deal, Nashville, Tenn.-based Contessa will operate as a wholly owned division of Amedisys.
Founded in 2015, Contessa partners with health systems and health plans across the country to offer complex patients acute and post-acute care in the comfort of their homes. Contessa’s unique, risk-based model and claims analytics capabilities bring the essential elements of inpatient hospital and SNF care to patients’ homes and have repeatedly proven to improve patient outcomes and experience while reducing costs and hospital readmissions. Today, Contessa has a number of prominent health system joint ventures and payor partnerships such as Mount Sinai Health System, Marshfield Clinic Health System, Ascension Saint Thomas, CommonSpirit Health, and Highmark Health and has a robust pipeline for potential expansion with more than a hundred hospitals across an additional 28 states.
“Today’s announcement is a strategic and promised milestone for Amedisys’ strategic growth and differentiation, as we expand our capabilities to reflect growing market demands and evolving patient preference for higher-acuity in-home settings,” Amedisys Chairman and Chief Executive Officer Paul Kusserow said in a news release. “While Amedisys continues to be a national leader in quality home health and hospice services, we have always worked to innovate and provide even more types of care in the home, as patients increasingly seek to ‘age in place’ in environments that are familiar and safe. Bringing the Contessa team into our family significantly advances this strategy.”
Contessa Founder and CEO Travis Messina, along with his experienced management team, will continue to lead Contessa, which will maintain its brand and operate and be reported on as a separate and unique business within Amedisys.
“We launched Contessa with the ambitious vision of creating innovative models that would allow as many patients as possible to receive higher-acuity care in their preferred setting—the home,” said Messina. “In the years since, we have made great strides toward that goal and are proud to partner with some of the nation’s top health systems and payors to treat more patients in their homes. To continue building on the momentum we’ve created and to take advantage of all the growth opportunities which currently exist, we wanted a partner with a national footprint, a reputation for outstanding clinical quality, and the scale and infrastructure available to accelerate our trajectory. Amedisys has all of that and more. They understand the pressures and challenges of today’s healthcare industry and are a strong partner to hospitals and physicians. Amedisys brings a proven reputation for innovation, an industry-leading clinical workforce, and a culture and leadership team that highly align with Contessa’s. We’re incredibly excited about what this will mean not only for our future and existing partnerships, but also for our caregivers, staff, and patients across the country.”
According to a company release, the transaction:
- Adds higher acuity, home-based care to Amedisys’ current service offering, allowing Amedisys to create a premier home-based health system
- Significantly expands Amedisys’ total addressable market (TAM) for in-home care services from $44B to $73B
- Provides an innovations platform that Amedisys will continue to invest in to accelerate growth of current services and to expand into additional in-home care services
- Creates a truly differentiated tech-enabled, home-based care platform adding capabilities, services, analytics, and management needed to become a risk-bearing, home-based care delivery organization, expanding well beyond traditional home health and hospice
- Positions Amedisys as the first national home health provider to move into the hospital at home and SNF at home space in a meaningful way with the ability to scale across a large geographic footprint
- Accelerates admissions growth opportunities for Amedisys Home Health and Hospice to seek care coordination and preferred provider agreements with current and future hospital at home and SNF at home hospital partners
- Leverages Amedisys’ nationwide home health footprint, industry leading quality home health clinicians, and home health business development staff to accelerate Contessa’s revenue growth opportunity
- Enhances the ability of Amedisys to provide quality care and outcomes across a continuum of care and lower costs through value-based care arrangements for commercial, Medicare, Medicare Advantage and managed Medicaid payers.
- Creates an attractive platform to recruit and retain highly trained and skilled clinicians interested in providing higher acuity care in the home.
- Adds access to a proprietary informatics platform, CareConvergence, which manages the logistics for high-acuity care in the home and the risk-bearing contracts that Contessa holds with payers