The Corner Series Episode 118: Opportunities in Lower Middle-Market Healthcare, With Ben Mackay
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Dec 16, 2025 Ben Mackay, a Principal at Evolve Capital, dives into the intriguing realm of lower middle-market healthcare, specifically focusing on Medicare home health. He shares how controlling ownership paired with founder retention can create lasting value. With insights on growth opportunities in autism services and specialty pharmacies for pets, he also discusses challenges like workforce shortages and navigating regulatory hurdles. Ben emphasizes rural market strategies and the advantages of scale in home healthcare, showcasing a diverse landscape of emerging opportunities.
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Home Health As Least-Cost Care
- Evolve focuses on Medicare-reimbursed home health where care is often the lowest-cost option.
- Ben argues home health keeps patients out of hospitals and lowers system-wide costs.
Margin Compression From Rate Cuts
- Rate cuts have compressed margins since the mid-2000s and current operations must run lean.
- Ben watches potential further reimbursement cuts and entitlement spending risks closely.
Fragmented Market Offers Roll-Up Targets
- The home health market remains fragmented with many tiny agencies alongside big players.
- Ben targets lower-middle-market platforms and add-ons to professionalize operations and scale.