Amedisys, Inc. (AMED - Free Report) recently entered into a Care Coordination Agreement with BrightStar Care to expand its Personal Care Network. The inking of the deal signifies the addition of BrightStar’s agencies to Amedisys’ Personal Care Network, which helps facilitate the coordination of care between Amedisys’ hospice and home health care centers and a network of personal care partners.
For investors’ note, BrightStar currently has presence in 38 states with its 340 personal care locations serving around 75% of the American population. However, this largely overlaps with the service areas of Amedisys.
Amedisys’ agreement with ClearCare, Inc. in July 2019 led to the beginning of the Amedisys Personal Care Network and created an opportunity for it to partner with personal care agencies through the ClearCare platform. The latest agreement enables the company to expand this network.
Rationale Behind the Agreement
Per management, the pandemic situation has thrown light on the vulnerability of the senior population who require quality care at homes now more than ever. The agreement is expected to expand Amedisys’ access to a variety of care that improves patient outcome and lowers costs.
The inability to effectively manage patients with multiple chronic conditions and activities of daily living restrictions is a primary reason for hospital admissions. However, with both medical and non-medical teams coordinating care for patients, hospitalizations can be avoided. This is expected to improve the care experience and patient outcomes through the entirety of their home care journey.
Amedisys will pilot the new partnership with BrightStar with care centers in Pennsylvania and Texas. If successful, the care coordination will be expanded across its service area.
Per a report by Grand View Research, the global home healthcare market was valued at $281.8 billion in 2019 and is projected to reach $515.6 billion by 2027 at a CAGR of 7.9%. Factors like a rising elderly population, increased patient preference for value-based healthcare, improved patient outcomes and convenience offered by home healthcare agencies are expected to drive the market.
Given the growing market potential, the signing of the agreement seems to have been timed well.
Amedisys’ performance during the second quarter of 2020 was quite impressive despite the pandemic, as was confirmed by it during its earnings release in July. Amid the coronavirus-led volume disruption across the United States, Amedisys ended the quarter with better-than-expected earnings and revenues. An impressive performance by the company’s Hospice division despite business disruptions buoys optimism. The strong performance of the company also encouraged it to reissue the full-year guidance.
In June, Amedisys completed the acquisition of Homecare Preferred Choice, Inc., which operates by the name of AseraCare Hospice.
Shares of the company have gained 83.2% in the past year compared with the industry’s 8.3% growth and the S&P 500’s 19.5% rise.
Zacks Rank & Key Picks
Currently, Amedisys carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the broader medical space are QIAGEN N.V. (QGEN - Free Report) , Thermo Fisher Scientific Inc. (TMO - Free Report) and Hologic, Inc. (HOLX - Free Report) .
QIAGEN’s long-term earnings growth rate is estimated at 22.3%. It currently flaunts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Thermo Fisher’s long-term earnings growth rate is estimated at 15%. It currently carries a Zacks Rank #2 (Buy).
Hologic’s long-term earnings growth rate is estimated at 15.5%. The company presently sports a Zacks Rank #1.
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