Home care has gone through a roller coaster of a ride over the past month. The most notable change has been the result of the Fair Pay for Home Care Act. Fortunately, it did not make it into the budget for the year and is considered a significant win for the home care industry as this law would not have achieved any savings.
Another notable and discussion-worthy topic is the passage of recreational marijuana for adults over 21 in NY. Technically, the law is active, but there are no legal means to purchase marijuana; therefore, anyone using it has likely obtained it from an illegal source. Employers have to adjust their hiring practices to ensure that a person who does use recreational marijuana is not discriminated against when being considered for a job OR while working. Employers cannot stop an employee from marijuana use before or after their work shift. However, if an employee is impaired while working, they can receive disciplinary action.
Once New Jersey made marijuana legal for recreational use, New York had to respond with the same measure. Governor Cuomo has taken things to another level with the proposal of home delivery as a state service. The tax revenue implications and the decline and release of persons with marijuana convictions are enormous advantages of the law. President Biden has also promised to make it legal on a federal level. As with everything else in life, only time will tell.
M&A's Part 3: Implementation
As it Approaches
With due diligence and no significant problems or concerns arising, we then take steps to execute a final contract for sale; the decisions are made on the type of purchase agreement, whether it is a shared purchase or asset purchase. The buyer would have secured their financing options for the deal by this time, but financing details typically come together after the purchase and sale agreement is signed. The deal closes, then both management teams work together on the process of merging the two firms.
As it Occurs
During the Implementation phase of a home care merger or acquisition, many essential steps should be taken. You will:
- Negotiate the final terms and make final provisions (e.g. if the business being acquired or sold has a settlement or PPP loan, you will need to keep monies in escrow and make clauses in the contract for sale as to who will be liable for such)
- Review and sign purchase agreements, contract of sale
- Sign management consulting agreements (if applicable)
- Notify patients, payors, insurance companies, third-party payors, staff, referral sources, and vendors
- Transition patients and caregivers
- Create workflows, transition roles, learn more about the staff, and join the existing and new team members
Since the new state budget was passed on April 1st, 2021, it speaks to mergers and acquisitions in the Fiscal Intermediary world. Thus we will see more and more mergers and acquisitions in the next few months. According to the NY budget bill 2021 Part LL (d), it will allow for a merger or acquisition of an FI awarded a contract. The consumer then can remain with the awarded FI allowing for continuity of care.
If you would like to learn more or explore companies for sale, please click on our website link below to request a consultation.