Having completed its acquisition of the home health and hospice assets sold by Amedisys as part of the UnitedHealth Group (NYSE:UNH) transaction, Pennant Group (Nasdaq:PNTG) is now focused on how the transaction will move the company forward.
“We are excited to add these businesses to Pennant,” Pennant CEO Brent Gerisoli said Thursday during the company's third-quarter earnings call. “The United and Amedisys process created a unique opportunity to add a high-quality asset in a desirable market at an attractive valuation, something rarely seen in large transactions with sophisticated operators. Our excitement only grows as we close the transaction and enter the business. We met many great leaders and team members who are deeply committed to their local communities.”
Pennant, based in Eagle, Idaho, is a holding company with independent operating subsidiaries that provide health care services. There are 141 home health and hospice agencies and 61 senior living communities.
Gerisoli noted that while Pennant is in the process of consolidation, the company's long-term leaders see great potential in these new additions.
Pennant's management is looking to the acquisition of Signature Healthcare at Home's assets as a model for the integration process of the latest Amedisys transaction.
“The Signature acquisition was similar in many ways to this recent transaction,” Gerisoli said. “Signature has a well-deserved reputation as a quality operator, and we thought we could build on that legacy through the pennant model. Signature's transition has been a huge success. We've watched former Signature leaders enthusiastically embrace the pennant model and culture and take their operations to new heights. They expressed that they now feel unlocked, able to take ownership of their operations, and empowered to grow.”
Empowering local leaders has long been a key element of Pennant's acquisition strategy.
Gerisoli believes the new business stemming from the Amedisys acquisition will demonstrate that Pennant's model provides value in both turnaround situations and solid business operations.
While the industry awaits the delayed release of the 2026 Home Health Final Payment Rule, Gerisoli explained that the pennant will withstand the proposed 6.4% cut in Medicare payments.
“Currently, uncertainty surrounding the 2026 home health rule casts a cloud over the industry, but pennants are not a passive metric tied to home health reimbursement rates,” he said. “While less than 20% of our revenue comes from Medicare home health fee-for-service reimbursement, we are a diversified acute care provider with strengths in hospice, senior living and home health, and more importantly, we are a community-driven leader that helps leaders proactively adapt to external challenges.”
Still, Gerisoli stressed that the company will continue to oppose the proposed rule, calling it “bad for patients, health care providers, and taxpayers.”
One of Pennant's advocacy efforts is its “Regulation Response Team,” which the company created to address Centers for Medicare and Medicaid Services (CMS) rulemaking.
Overall, Pennant's total revenue for the third quarter was $229 million, compared to $180.6 million in the third quarter of 2024, an increase of 26.8% year-over-year.
