Hospice Valuation Multiples and M&A Trends 2025

The hospice industry plays a critical role in the U.S. healthcare system, providing compassionate, end-of-life care to patients with terminal illnesses. Hospice services include pain management, symptom relief, counseling, and support for both patients and their families. The industry is heavily regulated and deeply influenced by reimbursement policy, but it continues to be a highly active sector for M&A, driven by demographic tailwinds and the ongoing aging of the U.S. population.

Key Growth Drivers

Key growth drivers for the industry include the following:

• Aging Population: The rising number of seniors, particularly those over 85, is expanding demand for hospice services nationwide.

  
  

• Shift Toward Value-Based Care: Hospice is a lower-cost alternative to hospital and acute-care settings, making it attractive to payers focused on cost containment.

  
  

• Increased Payer Support: Medicare remains the primary payer, but commercial payers are gradually expanding coverage, making services more accessible.

  
  

• Integration with Home Health and Palliative Care: Consolidation of hospice with adjacent post-acute services provides continuity of care and stronger referral networks.

  
  

• Public Awareness and Patient Preference: Growing acceptance of hospice as a quality-of-life service (rather than a last resort) is driving earlier utilization.

Hospice M&A Trends

Hospice has been one of the most active subsectors in post-acute healthcare M&A for the past decade. While overall deal activity moderated in 2023–2024 due to rising interest rates and tighter credit, hospice remains a priority for private equity and strategic buyers. Consolidation is expected to remain strong as buyers seek scale and market density.

According to Scope Research’s database, 2024 hospice deal volume declined about 15% from the 2022 peak and has yet to show strong signs of sustained recovery. Large strategics such as Amedisys, VITAS, and AccentCare continue to compete alongside private equity-backed platforms, often driving up valuations in competitive bidding processes.

Hospice EBITDA Multiples

Despite the decline in M&A volume, valuations remain strong.

• Small, Independent Hospices (typically revenue under $5M):

  These companies usually sell for lower multiples, ranging from 3x to 6x EBITDA. The lower multiple is often due to higher operational risk, lower revenue diversification, and limited geographic reach, as well as a heavy reliance on the owner / operator, which can lead to employer contract retention and business continuity concerns.

• State-Wide and Regional Platforms (revenue $5-30M):

  Larger, more established companies with proven profitability, a broader customer base, and possibly a unique niche, may command higher multiples. These can range from 6x to 10x EBITDA, depending on size, local market conditions, service mix, growth rate, and the stability of the cash flow.

  
  

• Scaled Platforms with Multi-State Presence:

  Well-managed platforms with growth trajectories and strong compliance records may command 10x to 15x EBITDA, especially when they integrate hospice with home health and palliative care. While publicly-disclosed financial information is sparse for this portion of the market, our database includes a many precedent transactions, including several recent deals with reported EBITDA multiples up to 17x (a high-margin, high growth platform).

Cash Flow Multiples for Small Hospice Agencies

There are a number of small hospice 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 3x cash flow to 5x cash flow at the 25th and 75th percentiles, with a median of 3.54x.

Factors Impacting the EBITDA Multiple for Hospice Agencies

Acquisition multiples are a function of perceived risk and growth. Key considerations within the hospice industry include the following:

• Regulatory Compliance & CAP Liability: Agencies with clean survey histories and no hospice aggregate cap issues command higher valuations, while compliance problems can significantly depress multiples.

  
  

• Scale & Market Density: Larger platforms with multiple locations and strong presence in key markets achieve better bargaining power with payers and higher multiples.

  
  

  Referral Source Stability & Diversity: A broad and dependable referral base (hospitals, SNFs, physician practices) reduces revenue concentration risk and improves valuations.

  
  

• Clinical Quality & Reputation: High family satisfaction scores, accreditation status, and positive outcomes (e.g., longer average length of stay, reduced hospital readmissions) support premium multiples.

  
  

• Payer Mix & Service Integration: Agencies with predominantly Medicare reimbursement are stable, but those that also secure managed care/commercial contracts and integrate with palliative/home health services often see valuation premiums.

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 73 hospice deals going back to 2010, 51 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.

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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 hospice agencies.

Read more about hospice valuations, or reach out to whamilton@healthfmv.com with valuation -related questions about your specific situation.