Sell a home care agency in Texas
A home care agency sells a state license, a team of caregivers, and a client base that depends on both. In Texas, a change of ownership is treated as a new license application, so licensing sits at the center of the timeline.
This page covers what buyers check when you sell a home care agency, the records they ask for, and how the HHSC change of ownership process works.
What buyers of a home care agency look at first
Home care buyers start with the license and the people.
State licensing
The agency's HCSSA license, its categories of service, and its survey and compliance history.
Caregiver retention
Turnover, recruiting, training, and how many caregivers are dedicated to long term clients.
Payer mix
Private pay, long term care insurance, Medicaid programs, and other payers, and how each pays.
Referral sources
Hospitals, physicians, case managers, and families, and how dependent the agency is on a few.
Administrator and clinical staff
Who serves as administrator and in required clinical roles, and whether they stay.
Scheduling and visit data
Hours delivered, missed visits, and electronic visit records.
Records to prepare for a home care sale
Home care buyers review compliance as closely as financials. The general document list is on our how to sell a business guide.
License and survey history
The current license, recent surveys, and any plans of correction.
Revenue by payer
Private pay, insurance, and program revenue by month for several years.
Client census
Active clients, hours per week, and length of service, without names early.
Caregiver records
Headcount, turnover, pay rates, and training records.
Contracts with payers and programs
Terms and what happens to each on a change of ownership.
Policies and procedures
The manual the agency operates under and how it is kept current.
How home care earnings are measured
Smaller agencies run by an owner who also acts as administrator are usually measured on SDE. Larger agencies with an administrator, clinical leadership, and office staff are more often measured on EBITDA.
Buyers adjust earnings for payer mix, since reimbursement rates and payment timing differ by payer. They also look for costs that a compliant operation would carry but the agency has not, such as required training or supervision.
Home care add backs that need documentation
- Owner salary above the cost of an administrator
- Personal expenses paid by the agency
- One time legal or consulting costs
- Family members paid but not working in the agency
- Nonrecurring software or recruiting campaigns
HCSSA licensing and change of ownership
The Texas Health and Human Services Commission (HHSC) states that Home and Community Support Services Agencies must be licensed to operate in Texas. HHSC defines a change of ownership as occurring when the agency changes its tax identification number, and treats a change of ownership as an initial application. HHSC charges a late fee if the application is submitted less than 30 days before the effective date, and requires the agency to notify the HHS regional office within six months of the effective date of the new license.
HHSC also notes that a licensing application applies only to the license, and that providers should contact their contract manager about how a licensing action could affect any contract they hold. Plan both tracks with counsel before signing a purchase agreement.
Official sources
Keeping a home care sale confidential
Caregivers, clients, and referral sources all depend on continuity.
- Caregivers who fear a change may look for other work. Tell key staff late, with the buyer.
- Families and clients hear about the sale when continuity of care is assured.
- Referral sources are introduced to the buyer after closing or near it.
- Client and caregiver names stay out of the process until late diligence.
Pricing a home care agency
Buyers weigh earnings against licensing status, payer mix, and caregiver stability. A clean survey history and steady private pay revenue reduce the risk a buyer takes on.
Forge prepares a broker opinion of value from the recast earnings, the condition of the assets, the risks a buyer would take on, and market evidence. A broker opinion of value is not a certified appraisal and is not a substitute for one. If a lender, a partner, or a court needs a formal appraisal, that is a separate engagement with a credentialed appraiser. Our business valuation page explains how the opinion is built.
Questions from home care agency owners
Does my HCSSA license transfer when I sell my agency?
A change of ownership is treated by HHSC as an initial application, so the buyer applies for its own license. HHSC defines a change of ownership as a change in the agency's tax identification number.
When should the change of ownership application be filed?
Early. HHSC charges a late fee if the application is submitted less than 30 days before the effective date. Build the timing into the purchase agreement.
What happens to my HHSC or program contracts?
HHSC notes that a licensing application covers only the license, and that providers should contact their contract manager about how a licensing action affects their contracts.
Do buyers prefer private pay agencies?
Many buyers value private pay revenue because it is paid directly and is not tied to program rates, but each payer type attracts different buyers.
How do I keep caregivers during a sale?
Keep the sale confidential until a buyer is committed, then introduce key staff with the buyer and discuss their roles. Continuity for clients depends on it.
Talk to Forge about selling your home care agency
Inquiries are confidential. Financial documents come later, after a confidentiality agreement is in place.
Related pages
Thinking about selling your home care agency?
Start with a confidential conversation about your license, your caregivers, and your timing.