What Is My Home Health Care Business Worth?

Home health care is one of the fastest-growing sectors in healthcare — driven by an aging population, consumer preference for in-home care, and policy shifts away from institutional settings. Buyer demand for home health agencies is intense, from individual entrepreneurs to PE-backed platforms.

Here's how to understand what your agency is worth.

Typical Valuation Ranges

Valuations vary significantly based on licensing and payer type:

• Non-medical / private-pay agencies (companion care, personal care): 2x to 4x SDE
• Licensed home health agencies (skilled nursing, therapy): 3x to 5x SDE or 5x to 8x EBITDA
• Medicare-certified agencies: Premium multiples — the certification itself carries significant value

Factors that push toward the higher end:

• Medicare or Medicaid certification
• Diversified payer mix (Medicare + Medicaid + private pay + insurance)
• Revenue above $2M with consistent growth
• Licensed clinical staff on payroll (RNs, therapists)
• Low patient concentration (no single referral source dominant)
• Strong compliance and survey history
• Management team in place

Factors that push toward the lower end:

• Private-pay only with no certifications
• Owner handles scheduling, intake, and management personally
• Caregiver recruitment and retention challenges
• Single referral source dependency
• Compliance issues or survey deficiencies
• Declining census or revenue

The Certification Premium

A Medicare-certified home health agency is worth significantly more than a non-medical agency — often 2–3x more at the same revenue level. Medicare certification takes 12–18 months to obtain, requires compliance infrastructure, and provides access to the largest payer in home health. Buyers pay a premium because they're buying that certification and the associated revenue streams.

Even agencies with modest revenue but clean Medicare certification attract strong buyer interest.

Key Metrics Buyers Evaluate

Census and Growth

Active patient census and the growth trend. Buyers want to see a growing or stable census with clear referral channels.

Revenue Per Patient

Total revenue per patient per month varies by acuity and payer. Higher revenue per patient indicates skilled services and a favorable payer mix.

Payer Mix

Diversification across payers reduces risk. Agencies overly dependent on a single payer (e.g., 80% Medicaid) face regulatory and reimbursement risk. A balanced mix is ideal.

Caregiver Retention

The home health industry faces severe staffing challenges. Agencies with caregiver turnover below 50% (industry average is much higher) have a significant competitive advantage.

Compliance History

Survey results, plans of correction, and compliance track record are critical. Agencies with clean surveys are worth more. Agencies with unresolved deficiencies face discounts or deal-killing risk.

Referral Diversification

Revenue from multiple referral sources (hospitals, physicians, discharge planners, community organizations) is healthier than dependence on a single hospital system or physician practice.

How to Increase Your Agency's Value

1. Pursue Medicare certification if you don't have it. This is the single highest-impact step for agency value.
2. Diversify payer mix. Add private-pay and insurance contracts alongside government payers.
3. Invest in compliance. Maintain meticulous documentation, QAPI programs, and survey readiness. Clean compliance history is non-negotiable for buyers.
4. Build referral relationships. Develop multiple referral sources across hospitals, physician practices, and community organizations.
5. Solve caregiver recruitment. Competitive wages, benefits, flexible scheduling, and career development reduce turnover.
6. Build management depth. Clinical directors, office managers, and compliance officers who operate without the owner create a transferable business.

Ready to Find Out What Your Home Health Agency Is Worth?

Browse the valuation multiples guide for current industry data, or schedule a free call for a confidential valuation.