With the CMS final rulings and the implementation of PDGM, smaller home health, physical therapy, and behavioral health bottom lines are about to get hit even harder with looming reimbursement cuts.
Further Consolidation is all but guaranteed.
Just as we’ve seen before, reimbursement cuts will lead to HEAVY consolidation in these industries.
Larger operators that aren’t as affected by reimbursement pressures will have a field day in snatching up struggling operators, which will lead to major home health and physical therapy consolidation.
Big home health players will keep winning.
The growth potential for larger operators through M&A will be unprecedented as industries like home health and physical therapy consolidate.
Just look at the stock prices of public home health operators – their valuations are arguably through the roof, with trading multiples several times higher than the industry average.
PT gets the short end of the stick: CMS all but guarantees Physical Therapy Consolidation.
Physical therapists are especially upset with the latest ruling. Just look at their subreddit. In addition, the APTA, the physical therapy trade organization, sent out this telling statement:
“APTA is extremely disappointed that the physician fee schedule final rule will cut physical therapist payment in 2021, with no rationale or response from CMS to thousands of letters opposing the cuts. These cuts are a dire threat to patient access and safe alternatives to pain.
CMS did listen to reason on the PTA modifier policy, adopting all of APTA’s recommended changes, which makes their inaction and lack of explanation on flawed payment cuts all the more confusing.”