What is Medicare home health reimbursement and how has PDGM changed it?

Traditional home health reimbursement (pre-PDGM): before 2020, Medicare paid home health through the Prospective Payment System (PPS) — a lump-sum payment per 60-day episode of care; payment was adjusted for the patient's clinical severity (diagnoses, functional status, service utilization history) and geography; home health agencies were incentivized to provide more therapy visits (physical therapy, OT, speech) because the reimbursement model paid more for therapy-heavy episodes; this created a system where agencies sometimes maximized therapy visits for financial rather than purely clinical reasons. PDGM (Patient-Driven Groupings Model), effective January 2020: CMS redesigned home health reimbursement to be based on patient characteristics (diagnosis, comorbidities, clinical severity) rather than service utilization; therapy visit thresholds were eliminated; payment is now based on two 30-day payment periods (vs. one 60-day episode); reimbursement is determined by the patient's primary admission source (community-referred vs. institutional-referred), clinical grouping (primary diagnosis category), and functional impairment level; behavioral assumptions built into PDGM assumed agencies would reduce therapy visits after the therapy utilization incentive was removed — CMS reduced payment rates by a 'behavioral adjustment' that assumed agencies would provide fewer therapy visits, reducing costs. Industry impact: PDGM required significant operational and clinical adjustments — home health agencies had to re-train their clinical intake, coding, and scheduling processes; agencies with heavy therapy utilization (which was financially driven rather than clinically driven) saw revenue per episode decline; agencies with strong skilled nursing programs adapted more easily; Amedisys and LHC Group both made significant operational changes to adapt to PDGM.

What is hospice care and how does it compare to home health as a business?

Hospice definition: hospice is a specialized type of care for patients who are terminally ill (with a life expectancy of 6 months or less if the illness runs its natural course) who choose to focus on comfort (palliation) rather than curative treatment; hospice provides: pain and symptom management by skilled nurses and physicians; emotional and spiritual support for patients and families; social worker assistance; chaplain services; medical equipment and supplies; and bereavement support for families after death; hospice is a philosophy of care focused on quality of life in remaining time rather than extending life at all costs. Medicare hospice reimbursement: Medicare pays hospice through a daily rate (per diem) rather than visit-based reimbursement; the daily rate varies by level of care (Routine Home Care is the most common — approximately $220-240/day); Medicare requires that hospice election means the patient forgoes curative treatment for the terminal diagnosis; hospice can continue indefinitely as long as the patient continues to meet medical eligibility criteria. Business model comparison: hospice has more predictable revenue than home health — daily per diem rates are fixed and stable; hospice census (number of patients enrolled on any given day) is the primary revenue driver; as the census grows, revenue grows proportionally; average length of stay (ALOS) varies significantly — shorter ALOS patients use more costly nursing resources at admission and death; longer ALOS patients (enrolled for months or years) have lower intensity of service during extended enrollment periods; hospice is generally higher-margin than home health because daily per-diem payments are more predictable than episodic home health payments that vary by patient condition. Amedisys hospice: Amedisys had a growing hospice segment that was a meaningful component of its strategy; hospice's per-diem model and higher margins made it an attractive complement to the visit-based home health business.

What is the 'home as the preferred site of care' trend and what technology is enabling it?

Trend background: U.S. healthcare is undergoing a structural shift toward home-based care delivery; historically, many medical services (infusions, wound care, cardiac monitoring, physical therapy, post-surgical recovery) required inpatient hospital or skilled nursing facility settings; advances in medical technology, remote monitoring, and telemedicine are enabling these same services to be delivered safely and effectively at patients' homes. Why home care is preferred: patient preference (most patients prefer to recover at home rather than in institutions); cost (a home health visit costs $100-200; a skilled nursing facility day costs $300-500; a hospital inpatient day costs $2,000+); infection prevention (patients in hospitals and nursing facilities are exposed to hospital-acquired infections — MRSA, C. diff); clinical outcomes (for appropriate patients, home-based recovery produces comparable or better outcomes than institutional settings with lower complication rates). Technology enablers: remote patient monitoring (RPM) devices — continuous monitoring of vital signs (blood pressure, pulse, oxygen saturation, blood glucose) transmitted to care teams remotely; telehealth (video visits by nurses, physicians, and therapists that replace in-person check-ins); hospital-at-home programs (providing acute-level care at home for conditions like pneumonia, COPD exacerbations, cellulitis — CMS has authorized hospital-at-home models); medication management (smart dispensers, blister packs, medication adherence apps); wearable sensors (fall detection, activity monitoring for frail patients). Implications for home health companies: the 'home as preferred site of care' trend is a secular tailwind for Amedisys, LHC Group (historical), and remaining public home health companies like Encompass Health's home health segment and Enhabit (EHAB); Optum's acquisition of Amedisys and LHC Group positions UnitedHealth to be both the payer (Medicare Advantage plan) and the provider (home health delivery) in this growing care setting.

brimindinvest.com / compare / amed-vs-lhcLIVE

AMED

Amedisys, Inc. (acquired by Optum/UnitedHealth Group, June 2024) · Healthcare - Home Health and Hospice Services (Historical — No Longer Publicly Traded)

N/A

N/A this month

VERSUS

⟷

COMPARE

LHCG

LHC Group, Inc. (acquired by UnitedHealth Group, February 2023) · Healthcare - Home Health and Community-Based Services (Historical — No Longer Publicly Traded)

N/A

N/A this month

Scoreboard verdict

Across AI score, momentum, valuation, upside, operating margin

AMED

0

LHCG

0

MIXED SETUP

Comparison scoreboard

MIXED SETUP

AI Score

AMED N/A

LHCG N/A

1Y Return

AMED N/A

LHCG N/A

Fwd P/E

AMED N/A

LHCG N/A

Target Up.

AMED N/A

LHCG N/A

Op. Margin

AMED N/A

LHCG N/A

Metrics last refreshed: 6/22/2026

Quick take

AMED vs LHCG Home Health Sector Comparison: AI Score, Valuation, Performance and Upside

AMED (Amedisys) and LHCG (LHC Group) were the two largest independent home health and hospice companies before UnitedHealth Group's Optum division acquired both — LHC Group in February 2023 and Amedisys in June 2024 — consolidating the home health sector into Optum's vertically integrated care delivery model alongside its physician practices and surgery centers. Both companies benefited from home health's demographic tailwinds and preference as a lower-cost care setting, but faced labor inflation, Medicare Advantage reimbursement pressure, and regulatory complexity.

AMED vs LHCG (historical) represented two strategic approaches to home health market leadership — Amedisys with a nationally distributed footprint in major markets and growing hospice and personal care segments, versus LHC Group with a distinctive rural market focus and hospital joint venture model where approximately 60% of home health locations were co-owned with hospital partners providing preferential patient referrals — both ultimately acquired by UnitedHealth Group as Optum pursued vertical integration of home-based care into its managed care ecosystem.

Live analysis · updated 6/22/2026

AMED and LHCG are closely matched — they split the tracked metrics evenly.

Normalized 1Y performance

AMED

LHCG

Not enough data to chart yet.

Recent returns

AMED

LHCG

Analyst price targets & sentiment

AMED

Price target data unavailable

N/A

LHCG

Price target data unavailable

N/A

Who should consider this stock?

AMED historically appealed to investors who:

→Wanted exposure to the demographically driven home health sector through a diversified national footprint across home health, hospice, and personal care services
→Valued Amedisys's urban and suburban market positioning and growing hospice segment as a high-margin recurring revenue business with favorable reimbursement relative to home health
→Noted the UnitedHealth/Optum acquisition of LHC Group as a strategic catalyst signal that Optum might similarly pursue Amedisys — which proved correct with the June 2024 acquisition at a meaningful premium to pre-announcement prices

LHCG historically appealed to investors who:

→Valued LHC Group's hospital joint venture strategy as creating durable referral relationships that provided stable patient volume independent of marketing spending or open-market competition for physician referrals
→Appreciated LHC's rural market positioning where home health was often the only post-acute care option and hospital partnerships provided near-captive referral pipelines
→Recognized UnitedHealth's interest in building a home-based care delivery infrastructure as making large independent home health companies strategic acquisition targets — LHC was acquired first, at a 35%+ premium to pre-announcement prices

Performance & AI score

Metric	AMED	LHCG
AI score	N/A	N/A
AI rank	N/A	N/A
Latest close	N/A	N/A
1M return	N/A	N/A
6M return	N/A	N/A
1Y return	N/A	N/A

$10,000 invested — hypothetical growth (dividends reinvested)

How much would $10,000 be worth today if invested at the start of each period, with all dividends reinvested?

Period	AMED	LHCG

Hypothetical — past performance does not guarantee future results.

Valuation & upside potential

Metric	AMED	LHCG
Market cap	N/A	N/A
Trailing P/E	N/A	N/A
Forward P/E	N/A	N/A
Price/Sales	1.41	2.37
EV/Revenue	N/A	N/A
Analyst target	N/A	N/A
Target upside	N/A	N/A

Growth, profitability & risk

Metric	AMED	LHCG
Revenue growth	N/A	N/A
Earnings growth	N/A	N/A
EPS growth	N/A	N/A
FCF margin	N/A	N/A
Operating margin	N/A	N/A
Profit margin	N/A	N/A
ROIC proxy	N/A	N/A
Return on equity	N/A	N/A
Dividend yield	N/A	N/A
Beta	0.40	0.44
Debt/equity	N/A	N/A
Current ratio	N/A	N/A
Quick ratio	N/A	N/A

Drawdown & downside risk

Lower drawdown and smaller single-period drops generally indicate a smoother ride, though they do not guarantee lower future risk.

1Y risk snapshot

AMED max drawdownN/A

LHCG max drawdownN/A

AMED max wkly dropN/A

LHCG max wkly dropN/A

5Y risk snapshot

AMED max drawdownN/A

LHCG max drawdownN/A

AMED max wkly dropN/A

LHCG max wkly dropN/A

10Y risk snapshot

AMED max drawdownN/A

LHCG max drawdownN/A

AMED max wkly dropN/A

LHCG max wkly dropN/A

Performance metrics by period

Period	Metric	AMED	LHCG
1Y	Growth	N/A	N/A
	CAGR	N/A	N/A
	Sharpe ratio	N/A	N/A
	Max drawdown	N/A	N/A
	Max daily drop	N/A	N/A
	Max wkly drop	N/A	N/A
5Y	Growth	N/A	N/A
	CAGR	N/A	N/A
	Sharpe ratio	N/A	N/A
	Max drawdown	N/A	N/A
	Max daily drop	N/A	N/A
	Max wkly drop	N/A	N/A
10Y	Growth	N/A	N/A
	CAGR	N/A	N/A
	Sharpe ratio	N/A	N/A
	Max drawdown	N/A	N/A
	Max daily drop	N/A	N/A
	Max wkly drop	N/A	N/A

Business comparison

Category	AMED	LHCG
Company	Amedisys, Inc. (acquired by Optum/UnitedHealth Group, June 2024)	LHC Group, Inc. (acquired by UnitedHealth Group, February 2023)
Sector	Healthcare - Home Health and Hospice Services (Historical — No Longer Publicly Traded)	Healthcare - Home Health and Community-Based Services (Historical — No Longer Publicly Traded)
Industry	N/A	N/A
Core business	Amedisys was one of the two largest independent publicly traded home health and hospice companies in the United States before its acquisition by Optum (UnitedHealth Group's health services division) in June 2024. Amedisys provided Medicare and Medicaid-funded home health nursing visits and therapy (physical therapy, occupational therapy, speech therapy) to patients recovering from hospitalizations and managing chronic conditions — enabling patients to receive skilled nursing and therapy care at home rather than in nursing facilities or hospitals. Amedisys also operated hospice programs (end-of-life comfort care) and personal care (non-medical home aide) services. At the time of acquisition, Amedisys operated approximately 540 home health and hospice locations. Amedisys was acquired for approximately $101/share, valuing the company at approximately $3.3 billion.	LHC Group was the second-largest independent publicly traded home health company before UnitedHealth Group acquired it in February 2023 for approximately $170/share ($6.2 billion total consideration). LHC Group provided home health (skilled nursing, therapy), hospice, home and community-based services (personal care, social services), and facility-based services. LHC Group had a distinctive geographic footprint with particular strength in rural markets across the South and Midwest, where home health was often the only viable post-acute care option due to limited nursing facility availability. LHC Group operated approximately 800+ locations. LHC Group's hospital joint venture strategy was even more extensive than Amedisys's — approximately 60% of LHC Group's home health locations were joint ventures with hospital systems.
Investor focus	Investors historically tracked Amedisys's same-store revenue growth, Medicare reimbursement rate environment, patient admission volume, hospice average daily census, and labor cost per visit — the primary cost driver for the labor-intensive home health business.	Investors historically tracked LHC Group's same-store revenue growth, hospital JV home health relationships (which provided stable referral pipelines), rural market positioning, and EBITDA margins relative to the reimbursement environment.

AMED strengths

→Medicare-funded home health has favorable demographic tailwinds — the aging U.S. population (baby boomers entering the 65+ age group) increases the number of Medicare beneficiaries, and older patients are the primary home health users; this demographic tailwind provides structural volume growth
→Home-based care is less expensive than inpatient or skilled nursing facility care — payers (Medicare, Medicare Advantage plans) increasingly prefer home-based care as a lower-cost alternative to institutional care; the 'home as the preferred site of care' trend supports home health volume expansion
→Joint venture model with hospitals (Amedisys had JV home health agencies with hospital partners) created referral channel relationships that provided patient volume from hospital discharge planners

LHCG strengths

→Hospital joint venture strategy — LHC Group's model of forming JV home health agencies with hospital systems created mutually beneficial partnerships; hospitals referred patients to the JV home health agency at discharge; the hospital earned equity income from the JV; LHC Group gained preferred referral status within the hospital system; approximately 60% of LHC's home health was through hospital JVs
→Rural market positioning — in rural areas where skilled nursing facilities are scarce, home health is often the only post-acute care option; rural hospitals that need a discharge pathway for their Medicare patients need a reliable home health partner; LHC's rural presence was a distinctive competitive advantage
→Geographic diversification across 35+ states reduced concentration risk from any single state's reimbursement or regulatory environment

Risks to watch — AMED

→Medicare reimbursement rate cuts and PDGM (Patient-Driven Groupings Model) implementation required significant operational adjustments that compressed margins during the transition period
→Labor cost inflation for skilled nurses and therapists is the primary variable cost; clinician shortages created wage pressure that compressed per-visit margins
→Medicare Advantage penetration created reimbursement headwinds — Medicare Advantage plans negotiated lower reimbursement rates than traditional Medicare FFS, and MA penetration was increasing among Amedisys's patient population

Risks to watch — LHCG

→Medicare reimbursement rate pressure affects both volume and pricing — CMS annual rate updates and the PDGM model implementation created margin pressure requiring operational adjustments
→Labor shortages in clinical staff (registered nurses, physical therapists) are particularly acute in rural areas where LHC operated; rural healthcare staffing is chronically challenging
→Medicare Advantage penetration — as more Medicare beneficiaries enrolled in MA plans, LHC's payer mix shifted toward lower-reimbursement MA contracts

Frequently asked questions

Optum's vertical integration strategy: UnitedHealth Group's Optum division has pursued an aggressive vertical integration strategy — owning or operating health services businesses alongside its UnitedHealthcare insurance business; Optum employs approximately 90,000+ physicians through its Optum Health physician organization (acquired DaVita Medical Group, ChenMed affiliations, and hundreds of physician practice acquisitions); Optum operates approximately 2,000+ surgery centers and urgent care facilities; Optum Rx is the third-largest pharmacy benefit manager; adding home health (through LHC Group and Amedisys) completed Optum's capability to manage a patient's care across the full continuum — from primary care through specialty care, surgery, pharmacy, and post-acute home-based care. Home health strategic rationale: as the largest Medicare Advantage plan sponsor (UnitedHealthcare insures approximately 28% of all Medicare Advantage beneficiaries), UnitedHealth has strong incentives to control home health costs; when Optum manages the home health provider (through LHC Group/Amedisys), it can: optimize care coordination to reduce avoidable hospitalizations; manage the cost and quality of post-acute care for its MA members; capture value from reduced total cost of care rather than paying external home health providers at negotiated rates. Scale economics: the combination of LHC Group ($6B acquisition) and Amedisys ($3.3B acquisition) with Optum's existing home health operations (Optum already had some home health through prior acquisitions) created the largest home health operator in the country with thousands of locations — achieving scale for technology investment, clinician training, and operational efficiency. Regulatory scrutiny: the Amedisys acquisition was subject to DOJ review; DOJ required divestitures of home health operations in markets where the Optum + Amedisys combined market share was deemed anticompetitive; Amedisys divested certain locations in concentrated markets as a condition of DOJ approval.

AI Prediction SignalNext 5 trading days

Members only

AMED

+2.8%BUY

LHCG

+1.1%HOLD

Start Free Trial Log in

ML model trained on historical prices · 14-day free trial · No credit card required

Free public comparison

Want deeper AI forecasts?

This comparison page is public and free forever. Subscribers can unlock saved watchlists, full AI rankings, detailed forecasts, and interactive analysis tools.

Start Free Trial Read Investing Guides

Related comparisons

GKOS vs AMED

Glaucoma Tech vs Home Health Care Services