It could be a turbulent year for SNF valuations in 2017.
After the election….that one….we thought we might be in for a wild ride with the unpredictable Donald Trump taking over. Healthcare M&A, which had slowed down a bit this year, seemed to be picking up, and interest in our products spiked after the election, which is always a telltale sign. But with yesterday’s announcements of the new heads of HHS and CMS, the ride could get a little wilder. By naming Tom Price to run Health and Human Services, one of the more anti-ObamaCare members of Congress and a physician to boot, you know what is going to happen. And apparently, he has been opposed to the rush to value-based Medicare payments, something that many post-acute providers have been preparing for. As a result, due diligence and valuations on deals may get a little trickier when the rules of the game are not known, or changed mid-inning. The nominee for head of CMS, Seema Verma, obviously knows her way around Medicaid, but it is unclear where she stands on Medicare. But we are sure she will toe the line of her new boss, Mr. Price. All I can say is that, combined with rising interest rates, it will be an interesting 2017.
