Baby boomers are about to be the largest generation in American history to hit the long-term care space. Born between 1946 and 1964, as defined by Pew Research, the oldest baby boomers are turning 80 next year. The group is set to flood a senior care space that is already understaffed, underfunded and facing political uncertainty.
“This space is completely underprepared for the number of older adults that are going to need long term care and end of life care,” said David Grabowski, professor of health care policy at Harvard Medical School. “We’ve historically relied heavily on families. There’s not going to be the number of family members that we’ve had in the past.”
Now private equity is increasingly looking to get in on the market. A recent study found between 2015 to 2022, 47 private equity firms bought 124 U.S. hospice agencies. Today an estimated 75% of U.S. hospice agencies are for-profit, according to a study out of the University of Pennsylvania.
“Hospice was started as a grassroots, nonprofit movement where the majority of care, a couple decades back, was provided by strictly non-profits,” said Robert Tyler Braun, assistant professor in the division of health policy and economics at Weill Cornell Medicine. “In this current landscape now, the majority of hospice providers are for profit.”
Nursing homes and long-term care facilities have long been an acquisition target for private equity and publicly traded companies. Data provided to CNBC by Coherent Market Insights shows those same trends in the hospice care space have picked up significantly since the 2010s.
Watch the video above to learn how these investments are impacting the space, who is investing in it, and what it means for seniors and their families.
