UnitedHealth to buy LHC Group in $5.4 billion deal
Home healthcare company LHC Group is being acquired by UnitedHealth Group, one of the nation’s largest health insurance providers, for a whopping $5.4 billion.
UnitedHealth’s subsidiary Optum Health is acquiring the home healthcare company for $170 per share of LHC Group. Optum Health is a pharmacy benefit manager and provides care directly through local medical groups and ambulatory care systems, including primary, specialty, urgent and surgical care to 100 million consumers. UnitedHealth Group’s UnitedHealthcare is the largest insurance provider in the U.S. LHC Group reported revenue of $2.2 billion in 2021.
“LHC Group’s sophisticated care coordination capabilities and its warm, human touch is so important for home care, and will greatly enhance the reach of Optum’s value-based capabilities along the full continuum of care, including primary care, home and community care, virtual care, behavioral health and ambulatory surgery,” Wyatt Decker, MD, CEO of Optum Health, said in a statement. “We greatly admire how the people of LHC Group have created a culture that enables them to be a trusted health care partner to patients and their families when they need it the most, and we look forward to working with and learning from them.”
The move is a major consolidation of home healthcare services and one that follows another major health insurer. Health insurance giant Humana acquired Kindred at Home in 2018 in a deal valued at approximately $4 billion. With debt, Optum’s acquisition of LHC Group is valued at roughly $6 billion.
LHC Group, based in Lafayette, Louisiana, is one of the largest home healthcare providers in the U.S., providing care for more than 12 million annual in-home patient-focused interventions. The company has 30,000 employees, including frontline care providers and administrative and support personnel.
As part of the deal, LHC Group leadership will continue with Optum Health.
“Since our founding in 1994, 'it’s all about helping people’ has been the core of our mission, and as part of the Optum team and its value-based capabilities, we will be able to expand our patient-centered mission and help drive best care practices across the country,” Keith G. Myers, LHC Group’s chairman and CEO, said in a statement. “Working together as organizations committed to caring for the most vulnerable in society will help us more effectively and efficiently deliver high quality and increasingly value-based care in the home.”
The deal is expected to close in the second half of 2022, subject to LHC Group shareholder approvals, regulatory approvals and other customary closing conditions. In addition, LHC Group co-founders Keith and Ginger Myers will invest $10 million into UnitedHealth Group stock following the close of the combination.
Amy joined TriMed Media as a Senior Writer for HealthExec after covering home care for three years. When not writing about all things healthcare, she fulfills her lifelong dream of becoming a pirate by sailing in regattas and enjoying rum. Fun fact: she sailed 333 miles across Lake Michigan in the Chicago Yacht Club "Race to Mackinac."