In what we believe is the first stand-alone ACO acquisition with a publicly-disclosed purchase price, HealthLynked Corp has purchased Florida-based ACO Health Partners, LLC for a reported $1.75m. The valuation multiples work out to:
0.91x PY 2018 shared savings revenue (most recent available)
0.78x estimated Year 1 revenue
3.50x estimated Year 1 EBITDA
$348 per PY 2018 assigned beneficiary
The revenue and EBITDA multiples are slightly lower than we would expect, which could be a function of a declining membership base. According to CMS data, assigned beneficiaries have declined 60% over the past five years, represented a compound annual growth rate of ~-17%, and bringing the ACO dangerously close to CMS's 5,000 beneficiary cutoff. ACO Health Partners' historical results under the MSSP are summarized below.
According to their public reporting disclosures, ACO Health Partners distributed $768,127 of PY 2018 shared savings to participating providers, implying a provider distribution model equal to 40% of shared savings.
BuckheadFMV has significant experience valuing ACO ownership interests and assessing distribution models for fair market value compensation compliance. Please don't hesitate to contact us with your ACO valuation-related questions.