IMPORTANCE: Private equity firms and publicly traded companies have been acquiring US hospice agencies; an estimated 16% of US hospice agencies are owned by private equity (PE) firms or publicly traded companies (PTC).

OBJECTIVE: To examine the association of PE and PTC acquisitions of hospices with Medicare patients' site of care and clinical diagnoses.

DESIGN, SETTING, AND PARTICIPANTS: This cohort study of US hospice agencies used a novel national database of acquisitions merged with the Medicare Post-Acute Care and Hospice Public Use File for 2013 to 2020. Changes in sites of care and patient characteristics for hospice agencies acquired by PE or PTCs were compared with changes for patients in nonacquired for-profit hospice agencies.

EXPOSURE: Private equity and publicly traded company acquisitions.

MAIN OUTCOMES AND MEASURES: This study used a difference-in-differences approach within an event-study framework to examine the association of PE and PTC acquisitions of hospice agencies with changes in patient diagnoses and sites of care. Dependent variables were annual hospice-level measures of the Hierarchical Condition Category (HCC) score and proportion of patients diagnosed with cancer or dementia. Sites of care included the proportion of patients receiving hospice care in their personal home, nursing home, or assisted living facility.

RESULTS: A total of 158 hospice agencies acquired by PEs, 250 acquired by PTCs, and 1559 other for-profit hospice agencies were included. Preacquisition, hospice agencies that would later be acquired by PE or PTC served a mean (IQR) 30.1% (12.0%-44.0%) and 29.4% (13.0%-43.0%) of their patients in nursing homes respectively, a greater proportion compared with the 27.1% (8.0%-43.8%) served by for-profit hospices that were never acquired. Agencies acquired by PE between 2014 and 2019 saw a significant relative increase of 5.98% in dementia patients (1.38 percentage points; 95% CI, 0.35-2.40 percentage points; P = .008). In PTC-owned hospices, the proportion of patients receiving care at home increased by 5.26% (2.98 percentage points; 95% CI, 1.46-4.51 percentage points; P < .001), the proportion of dementia patients rose by 13.49% (3.11 percentage points; 95% CI, 2.14-4.09 percentage points; P < .001), and the HCC score decreased by 1.37% (-3.19 percentage points; 95% CI, -5.92 to -0.47 percentage points; P = .02).

CONCLUSIONS AND RELEVANCE: These findings suggest that PE and PTCs select patients and sites of care to maximize profits.