Diversification and corporate restructuring revisited. Back to square one?

An historical overview of corporate restructuring in the health care industry is presented. Initial reasons for forming multicorporate structures centered on avoiding regulations governing certified home health agencies and maximizing third party payer reimbursement. As competition increased, home care agencies employed diversification strategies for survival and reorganized their single corporate structures to launch new businesses and engage in profit-making activities. Corporate restructuring is a time-consuming and complex endeavor that should only be undertaken as a part of an agency's strategic plan. Evaluating an agency's corporate structure is a continual process and the criteria for evaluating change over time. The current experience with diversification in the health care industry suggests that the proliferation of multicorporate structures is stemming as health care providers begin to refocus on their core business.