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Home-based care dealmaking is becoming more selective, with buyers favoring providers that show strong compliance, clinical quality and financial records. Industry experts cited Medicare enrollment limits, higher financing costs and a potentially more favorable 2027 payment outlook as factors shaping transactions, while the pace and scale of any rebound remain uncertain.
Home-based care acquisitions are entering a more selective phase, with buyers prioritizing financially sound, clinically strong and compliant providers over the broader deal volume seen around 2021, industry experts told Home Health Care News. The shift matters for agencies considering a sale: strong records may support buyer confidence and value, while compliance concerns and higher financing costs can stall transactions.
Buyers remain interested in the sector, but are applying greater scrutiny, according to Cory Mertz, co-founder and managing partner of healthcare M&A advisory firm Mertz Taggart. He said providers with accurate accounting and clean operations can still command premium values, while average or weaker companies that might have sold in the past are not finding buyers as readily. Geographic density and quality outcomes are also among the factors influencing deal decisions.
The financing environment has changed since 2021, when low interest rates and inexpensive capital supported debt-heavy acquisitions by private equity firms and other buyers. Higher borrowing costs now require purchasers to commit more equity, making deals more expensive and encouraging more selective acquisition strategies. Les Levinson, a partner and co-chair of the transactional health law group at Robinson+Cole, said macroeconomic conditions contributed to weaker-than-expected performance in the first and second fiscal quarters of 2026.
Market signals are mixed. The Braff Group’s August report said home-based care dealmaking was gaining momentum and could grow into 2027. Jason Growe, founder and chief development officer of LiveWell Partners, also described investor interest in the sector, citing the comparatively low cost of home-based care and patient preference for receiving care at home. He said current transactions are stronger in financial performance and care quality than deals in the earlier boom, though activity has not returned to that peak.
Compliance Is Shaping Buyer Confidence
For agencies, the market shift makes compliance readiness a practical transaction issue, not just a regulatory obligation. Buyers may examine audit exposure, potential clawbacks, documentation and the speed and reliability of a seller’s responses during due diligence. Levinson said well-organized providers that can answer questions clearly create confidence; uncertainty about compliance practices can make buyers anxious and may disrupt a deal or affect value.
A federal enrollment restriction adds another dimension. Levinson said the CMS home health Medicare enrollment moratorium may increase the appeal of existing agencies that meet its standards, because buyers cannot simply rely on newly enrolled companies to expand their options. That could make established, compliant providers scarcer acquisition targets. It does not mean every existing agency will attract a buyer: financial performance, quality and fit still matter.
For investors and operators, selective dealmaking may favor transactions that add local scale or strengthen service coverage rather than acquisitions based on rapid expansion alone. Home-based services also attract interest because they can cost less than care in institutional settings, Growe said. These are industry assessments, not a guarantee that lower costs or a changing payment outlook will produce a particular transaction or return.
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From 2021’s Deal Boom to Selectivity
The current approach contrasts with the acquisition environment of 2021, when low rates made debt financing less costly and supported more aggressive purchasing. Levinson said global disruptions and interest rates later had a stronger chilling effect on transactions than some expected. The source report described the first two fiscal quarters of 2026 as weaker than anticipated, while also citing signs that activity may be gathering momentum.
Two policy developments are relevant to the outlook. CMS proposed a 2.4% aggregate increase in home health payments in July, according to the report. The figure is a proposed change, not a final payment update. Mertz said the proposal offered more near-term certainty about 2027 payments than expected. Separately, the enrollment moratorium has increased attention to the value of established agencies, according to Levinson.
LiveWell’s recent activity offers one example of buyers emphasizing compliance. Growe said the company acquired Michigan Community VNA Home Health and Hospice in July, its third deal in Michigan, and has increased its focus on compliance and due diligence over the past couple of years. That example illustrates one operator’s approach; it does not establish a market-wide trend by itself.
“There’s a lot of investor capital that is looking to be deployed, and home-based care is an attractive place to look.”
— Jason Growe, founder and chief development officer of LiveWell Partners
Deal Rebound Still Has Limits
The outlook remains a forecast, not a confirmed surge in completed transactions. The report cited weak first- and second-quarter 2026 performance alongside the Braff Group’s assessment that momentum is building. It did not provide a specific deal count, transaction value or baseline for measuring the expected increase, so the size of a rebound cannot be established from the cited information.
It is also unclear how many agencies will meet buyers’ compliance and financial standards, how the enrollment moratorium will affect the supply of saleable businesses, or whether financing conditions will improve. CMS’s 2.4% payment increase remains a proposal in the source material; its final status and the effects on provider finances are not established there. The report also notes rising demand for Medicaid-reimbursed personal care and private duty nursing, but does not quantify that demand or detail how it may affect deal volume.
Watch CMS and Deal Activity
Near-term developments include CMS’s next steps on the proposed home health payment rule and any further changes affecting Medicare enrollment. Buyers and sellers will also be watching interest rates, audit and clawback exposure, and whether reported investor interest turns into completed acquisitions. Mertz said the proposed payment outlook gives the market a clearer view of the coming year, while Growe forecast faster deal-pipeline activity over the next two to three years. Those expectations will need to be tested against actual transactions and final policy decisions.
For agencies exploring a sale, the experts’ comments point to a practical focus: maintain accurate financial records, document compliance practices and be prepared to answer buyer questions during due diligence. These steps may improve confidence, but they do not guarantee a sale or a premium valuation.
Key Questions
What is changing in home-based care dealmaking?
Buyers are described as more selective than during the 2021 acquisition boom, placing greater weight on financial records, compliance, clinical quality and geographic fit.
Why could the Medicare enrollment moratorium affect acquisitions?
Industry lawyer Les Levinson said limits on new Medicare enrollments may increase the appeal of established agencies that meet the requirements. The available information does not quantify how much this changes the number or value of deals.
Has home-based care M&A activity rebounded?
The report describes mixed signals: early 2026 performance was weaker than expected, while the Braff Group and industry participants pointed to building momentum. A broad rebound in completed deals has not been established by the information provided.
Is the proposed 2.4% home health payment increase final?
No. CMS proposed a 2.4% aggregate increase in July, according to the report. The source describes it as proposed, so it should not be treated as a finalized payment change.
What can make an agency more attractive to buyers?
The experts cited clear compliance practices, accurate accounting, strong care quality and credible financial performance. Those qualities can support buyer confidence, but they do not guarantee an offer or a particular sale price.
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