Physical Therapy Sector Overview
JANUARY 2024
JANUARY 2024
Physical therapy (PT) is a healthcare offering focused on the preservation, enhancement or restoration of movement and physical function impaired by disease, injury or disability. Common treatment applications include therapeutic exercise, physical modalities, assistive devices and patient education.
Sources: Publicly available information
Sources: Publicly available information
Aging U.S.
Population |
The Population of people 50+ is increasing each year, leading to proportionate growth across chronic and age-related disorders
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Highly Competitive, Fragmented Market
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Private equity-led consolidation is a growing theme in the Physical Therapy market, positioning established platforms, with set infrastructure, for continued growth
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Increase in
Active Lifestyles |
The U.S. is trending towards an active, health-centric lifestyle, leading to a higher chance of rehabilitation therapy stemming from acute injuries
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Reform of
Rehab Favoring Active Therapy |
Pain management from sports, chronic and age-related injuries or ailments, are moving towards movement therapy and away from opioid and medication usage
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Barriers to
Access of PT Services |
Direct access to PT care is continuously improving, but the payment structure of therapy practices makes completing a full course of PT care challenging for many Americans
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Surgical Advancements
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Surgical safety innovations and new minimally invasive procedures have allowed more advanced treatments to be performed in outpatient settings (more incentive to get surgery vs. PT)
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Future Physical Therapist Shortage
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High demand and low unemployment rates are due in large to the number of therapists retiring – in 2019 ~49% of physical therapists were between ages 50-64, compared to 32% in 2010
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Reimbursement Cap for Certain Therapies
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High claim denials are the main limiting factor in the therapy market as of right now due to a reimbursement cap placed on Physical and Occupational Therapy
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Sources: Publicly available information
Source: HealthcareAppraisers, IBISWorld
Despite years of private equity-led consolidation, the physical therapy market and payor mix remain highly fragmented.
Source: HealthcareAppraisers, IBISWorld
The Physical Therapist Workforce and Patient Access Act (H.R. 3759/S. 2676)
Allows physical therapists to participate in the National Health Service Corps Loan Repayment Program. This program assists primary care, mental health, and dental providers in repaying eligible student loans in exchange for working in areas with shortages of such providers
The Allied Health
Workforce Diversity Act (H.R. 3320/S. 1679)
Allows the DHHS to provide grants to accredited education programs increasing diversity in the physical therapy, occupational therapy, respiratory therapy audiology, and speech-language pathology professions. Grants may be used to provide scholarships or support for recruitment and retention of students from underrepresented groups
Physical Therapy Act of 2021
Physical therapists to receive payment under Medicare for services provided to the patients by another physical therapist through a qualifying temporary arrangement, regardless of the geographic area or population served
Source: HealthcareAppraisers, IBISWorld
Acquirer | ||||
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Operator | ||||
Initial Investment | May 2021 | December 2020 | November 2016 | January 2022 |
Geography | Wisconsin & South Carolina |
California, Washington & Wyoming | East Coast Locations GA, SC, DE, MD, NC, PA, VA, WV, DC |
U.S. Locations 22/50 States |
Locations as of December 2023 | 245 locations | 212 locations | 985 locations | 393 locations |
Locations Added | 4 add-ons & 18 locations |
4 add-ons & 83 locations |
2 add-ons & 56 locations |
1 add-on & 64 locations |
Add-Ons |
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Source: Respective company websites
Date | Target | Acquirer | Transaction Type | |
---|---|---|---|---|
June 2023 | Was acquired by | Platform | ||
November 2023 | Was acquired by | Add-On | ||
April 2023 | Was acquired by | Add-On | ||
February 2023 | Was acquired by | Add-On | ||
February 2023 | Was acquired by | Add-On | ||
November 2022 | Was acquired by | Add-On | ||
November 2022 | Was acquired by | Add-On | ||
May 2022 | Was acquired by | Add-On | ||
May 2022 | Was acquired by | Add-On | ||
April 2022 | Was acquired by | Add-On | ||
April 2022 | Was acquired by | Add-On | ||
April 2022 | Was acquired by | Platform | ||
April 2022 | Was acquired by | Add-On | ||
February 2022 | Was acquired by | Add-On | ||
February 2022 | Was acquired by | Add-On | ||
January 2022 | Was acquired by | Platform | ||
January 2022 | Was acquired by | Add-On | ||
January 2022 | Was acquired by | Platform | ||
December 2021 | Was acquired by | Add-On | ||
December 2021 | Was acquired by | Add-On | ||
December 2021 | Was acquired by | Platform | ||
December 2021 | Was acquired by | Add-On | ||
November 2021 | Was acquired by | Add-On | ||
August 2021 | Was acquired by | Add-On | ||
July 2021 | Was acquired by | Add-On | ||
May 2021 | Was acquired by | Platform | ||
May 2021 | Was acquired by | Add-On | ||
April 2021 | Was acquired by | Add-On | ||
March 2021 | Was acquired by | Add-On | ||
December 2020 | Was acquired by | Platform |
Founded in 1991, Physical Rehabilitation Network ("PRN") maintains an owner-operator clinic model, which allows for the development of the physical therapy practice without the administrative burden providers typically face.
Gryphon Investors made their third physical therapy investment with the acquisition of PRN in 2020. At the time of the transaction, PRN consisted of over 200 clinics in more than 12 states.
Gryphon Investors is a leading Private Equity firm focused on partnerships with experienced management teams and their companies to enhance profitability and generate competitive market advantages. The firm has deployed over $5.0 billion of capital since 1997.
Source: Respective company websites
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