Selling a home care agency in California

Two regulators, two kinds of agency

California home health agencies, which provide skilled nursing and therapy at home, are licensed by CDPH's Licensing and Certification program. Non-medical home care, meaning help with daily activities by home care aides, requires a home care organization license from CDSS under the Home Care Services Consumer Protection Act.

If you run both, you hold two licenses from two departments, and a buyer has to plan for both. Buyers that want a continuum of care in California often look for exactly that combination, but they will diligence each license separately.

Home health change of ownership and the five-year rule

Under Health and Safety Code section 1728.75, a CDPH home health license is not transferable. California's home health regulations deem a change of ownership to occur when 50 percent or more of the issued stock, assets, or partnership interests transfer, or when management of the agency is relinquished, and require an application within 10 working days. The application goes to CDPH on form HS 200. CDPH asks for the effective date on which the new owner took over financial management, not the date the purchase agreement was signed.

The same section bars CDPH from approving a change of ownership of a home health agency within five years of the license first being issued, with narrow exceptions for continuity of care or financial hardship. If your license is less than five years old, raise it with any buyer at the start, because it may decide whether a deal is possible now or how it has to be structured.

OHCA notice for private equity and MSO buyers

California's Office of Health Care Affordability reviews health care transactions. AB 1415, signed in October 2025, extended its notice requirement so that from January 1, 2026, private equity groups, hedge funds, management services organizations, and entities newly formed for a deal must notify OHCA at least 90 days before closing a transaction that transfers a material amount of a health care entity's assets or control.

For a seller, the practical effect is time. A deal with a private equity backed buyer often needs a 90-day window between filing and closing, and the letter of intent should account for it. Strategic buyers and smaller transactions may fall outside the requirement, which is a question for counsel early in the process.

Payer mix: Medi-Cal, IHSS, and private pay

A large share of publicly funded personal care in California runs through In-Home Supportive Services, a county-administered program in which recipients hire their own providers. That means licensed home care organizations tend to rely more on private pay, long-term care insurance, and contracts than agencies in states where Medicaid personal care flows through licensed agencies.

For skilled home health, Medicare and Medi-Cal managed care plans drive volume. Buyers look at payer concentration, referral sources, and how dependent the census is on a single hospital system.

Who is buying in California

California is a market national platforms already operate in. The Gentiva personal care business that Addus HomeCare agreed to acquire in June 2024 included California among its seven states. Buyers with an existing presence typically look for density in the metros they already serve, while new entrants weigh the state's longer regulatory timelines against its size.