NEW YORK, Nov. 15, 2016 /PRNewswire/ -- An aging population, the prevalence of chronic disease, growing physician acceptance of home care, medical advancements and a movement toward cost-efficient treatment options from public and private payers have all fostered growth for the Home Care Providers industry. Over the five years to 2016, these factors have contributed to annualized revenue growth of 4.5% to $89.2 billion.
For the full report, visit IBISWorld's Home Care Providers in the US industry report page.
However, over the past five years, federal and state budgets have shrunk, and sequestration only exacerbated this decline. According to IBISWorld Industry Analyst Dmitry Diment, "decreasing federal funding has thus resulted in reimbursement cuts for the industry and has suppressed operating profit." Industry operators have increased consolidation activity in an effort to combat lower profitability.
Consolidation is forecast to continue over the five years to 2021 in light of reimbursement cuts that are expected to persist, and a shortage in skilled personnel. These factors will strain operating profit further, causing profit margins to stagnate over the next five years. In an effort to spur new demand and maintain pricing, industry operators are expected to focus more on chronic disease management. Thus, industry revenue is forecast to grow over the next five years.
Downstream industries impacted:
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