Optum, a division of UnitedHealth Group, is planning to acquire LHC Group, one of the largest home health companies, for about $5.4 billion in cash.
“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,” said Wyatt Decker, M.D., CEO, Optum, an information and technology-enabled health services business, in a statement Tuesday.
Optum will purchase LHC Group for $170 a share, according to the statement. The deal is expected to close in the second half of 2022 subject to LHC Group shareholder and regulatory approvals and other customary closing conditions.
“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,” said Keith G. Myers, LHC Group’s chairman and CEO. “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 transaction marks another major insurance company purchase of a home care company. Humana purchased Kindred at Home, the largest home health company, last year.
LHC Group has 30,000 employees, who include frontline care providers and administrative and support personnel. The LHC Group leadership team will continue forward as part of Optum Health. Following the deal’s close, co-founders Keith and Ginger Myers personally will invest $10 million in UnitedHealth stock, according to the statement.
The development follows a lawsuit filed by the Department of Justice last month to block UnitedHealth’s $13 billion purchase of Change HealthCare, a platform to help payers, providers and consumers improve clinical and financial outcomes. The suit alleges the deal would “harm competition” in commercial health insurance markets, and in the market for a technology used by health insurers to process health insurance claims and reduce healthcare costs.
This is a developing story. Please check back for details.