Home Health Valuation Multiples and M&A Trends 2025
- Will Hamilton
- Jul 24
- 4 min read
The home health sector is one of the largest areas of post-acute healthcare, with volume growth driven by both demographic pressures and patient preference for care in the home. Services range from skilled nursing and therapy delivered under a physician’s order (medical home health) to non-medical assistance with activities of daily living such as bathing, dressing, and meal preparation (personal care). While both segments share common growth drivers, their operating models, payers / reimbursement structures, and valuation dynamics diverge sharply, creating distinct considerations for investors, acquirers, and operators.
Medical Home Health (Skilled Home Health): Medicare-certified agencies providing skilled nursing, PT/OT/ST, wound care, and other clinical services under physician orders.
Non‑Medical Personal Care (Private Duty / Home Care): Assistance with activities of daily living (ADLs), companionship, and homemaker services delivered by caregivers/aides; typically not clinical and usually either private pay or Medicaid.
Both segments benefit from the continued shift to care-at-home, but they diverge sharply in reimbursement, regulation, staffing, and valuation dynamics, key distinctions for buyers and sellers.
Key Growth Drivers
Key growth drivers for the industry include the following:
Demographics & Care Preferences: Rapid growth in the 75+ population and strong patient preference to “age in place.”
Payer Push to Lower-Cost Settings: Health plans and health systems steering appropriate cases out of hospitals and SNFs.
Advances in At‑Home Models: Remote monitoring, virtual visits, and emerging hospital-at-home programs increase clinical confidence in home settings.
HCBS & Waiver Expansion (Personal Care): States expanding Medicaid home- and community‑based services; private-pay demand rising with wealth demographics.
Post‑Acute Integration: Platforms combining home health + personal care + hospice + palliative to capture more of the care continuum and referrals.
Home Health M&A Trends
Deal flow moderated in 2023–2024 amid higher rates and diligence friction, but 2025 activity remains resilient, despite looming proposed cuts to Medicare rates, with add-on acquisitions driving most volume. Private equity platforms continue to emphasize market density, referral access, and operating leverage. Strategics pursue multi‑service footprints to serve payers and health systems seeking single‑contract solutions across post-acute.
Medical Home Health: Buyers scrutinize PDGM performance, HHVBP quality measures, ADR/audit exposure, and clinician recruiting, favoring multi‑branch operators with strong clinical governance. However, looming rate cutes proposed by CMS may reduce market activity further.
Personal Care: Interest remains high for private‑pay heavy models with durable retention and scheduling efficiency; Medicaid-heavy agencies are active but more rate‑sensitive and state‑specific.
Home Health EBITDA Multiples
Medical Home Health (Skilled)
Single‑Branch / Small (revenue < ~$5M): 3x–6x EBITDA: Owner‑operator reliance, referral concentration, and clinical staffing constraints weigh on multiples.
Regional Multi‑Branch (~$5M–$25M): 6x–9x EBITDA: Better PDGM performance, diversified referrals, stronger back office, and quality metrics improve valuations.
Scaled / Multi‑State Platforms: 9x–12x+ EBITDA: Premiums for density, payer contracts (incl. MA), clinical programs (wound, cardiac, ortho), and clean compliance history.
Non‑Medical Personal Care (Private Duty / Home Care)
Small / Single‑Market: 3x–5x EBITDA: Multiples hinge on caregiver supply, client retention, and private‑pay vs. Medicaid mix.
Regional Operators: 5x–8x EBITDA: Higher for private‑pay dominant books with strong recurring hours and scheduling efficiency.
Scaled Platforms: 7x–10x EBITDA: Premiums for multi‑state ops, technology-enabled scheduling, high caregiver retention, and payer/health‑system relationships.
Cash Flow Multiples for Small Home Health Agencies
There are a number of small home health and personal care agencies listed for sale currently, but it's difficult to glean much useful information from deals this small where the level of owner involvement is unclear. Our study of current and recently removed agencies for sale shows a range of multiple from 2.11x cash flow to 4x cash flow at the 25th and 75th percentiles, with a median of 3x.
Factors Impacting the EBITDA Multiple for Home Health Agencies
Acquisition multiples are a function of perceived risk and growth. Key considerations within the home health industry include the following:
Payer Mix & Rate Adequacy: MA/Medicare PDGM performance vs. private‑pay/Medicaid rates; stability of contracts and authorization processes.
Market Density & Referral Channels: Hospital/SNF/physician referrers for medical; community, digital, and LTC insurance channels for personal care.
Clinical/Operating Quality: HHVBP scores, LUPA rates, documentation accuracy (medical) and EVV compliance, cancellation rates, hours-per-client retention (personal care).
Labor Model & Retention: Clinician and caregiver supply, wage pressure, recruiting funnel, and scheduling efficiency.
Regulatory Profile: Survey history, ADR outcomes (medical), licensure/EVV audits (personal care), and any state‑specific program risks.
About Scope Research
Scope Research compiles a variety of healthcare M&A databases and provides healthcare valuation services. The Scope Research Healthcare M&A Valuation Database currently has financial details for 138 home health deals going back to 2010, 94 of which include reported EBITDA multiples. The data can be purchased individually, while our affordable annual subscriptions provide access to all of our healthcare M&A databases and segments, updated continuously.
Contact Will Hamilton at will@scoperesearch.co with questions about our healthcare M&A databases.
About HealthFMV
HealthFMV specializes in appraising healthcare businesses and services arrangements, including home health agencies.
Read more about home health valuations, or reach out to whamilton@healthfmv.com with valuation -related questions about your specific situation.