Exclusive: Sheridan buys National Care Systems, seeks add-ons for the RCM provider
There’s a ‘great need’ for RCM providers focused on post-acute healthcare services, Sheridan’s Jonathan Lewis told PE Hub.
Sheridan Capital Partners is expected to announce later on Tuesday that it has acquired National Care Systems, PE Hub is the first to report.
PE Hub caught up with Jonathan Lewis, a partner at Sheridan, in an exclusive interview to learn more about the deal and why revenue cycle management businesses are appealing to private equity.
Great need
“RCM continues to be an area of focus for us,” Lewis said. “There’s a great need for it within the healthcare landscape, especially post-pandemic. There have been a lot of cost increases, due to inflation and the rising cost of wages to deliver care, and because of the demographics of the aging population, there are more people entering the post-acute setting of care. That leads to a need to reduce expenses and bend the cost curve of delivering healthcare.”
Founded in 1992, NCS offers billing and payroll software for skilled nursing facilities and assisted living facilities operators. The Brooklyn-based company’s RCM tool supports invoice generation, payment tracking, insurance claims processing and regulatory compliance. NCS serves a customer base of more than 1,700 facilities nationally through partnerships with facility operators and outsourced RCM providers.
“NCS is an attractive, founder-owned business,” Lewis told PE Hub. “It’s been in business for almost 30 years and has a strong, loyal customer base and has grown up in and around RCM. The company identified early both the opportunity but also the need for improvements in RCM in the healthcare sector and specifically around the post-acute setting of care, such as skilled nursing and assisted living.”
Demand for post-acute care is growing. These settings are popular with patients and tend to cost less than traditional hospital stays.
“A lot of the company’s customers are themselves growing, so there’s built-in growth, and there’s an opportunity to widen the message and continue to penetrate or work with groups that we’re not serving today,” Lewis explained. “As the owners of these facilities continue to scale, they recognize the opportunity to use a specialized revenue cycle provider. The specialized billing software that is more tailored and specific can help optimize their collections.”
Add-ons are a part of Sheridan’s overall strategy for NCS – as they are in every deal Sheridan does. “As we think about that, it’s both finding ways to offer new services to our existing customer base and finding adjacencies or other groups to serve,” Lewis said about the add-on strategy. “It’s also about finding ways to enhance our value proposition to our existing client base and continuing to serve and grow with them.”
Tech-enabled
RCMs like NCS have proven to be a consistent dealmaking subsector for Sheridan. In 2023, the Chicago-based firm acquired Future Care Consultants, a provider of specialty RCM and other back-office services. The Lakewood, New Jersey-headquartered company rebranded to Focal Point Care in 2025.
In 2021, Sheridan invested in SimiTree, a Hamden, Connecticut-based RCM business serving home health and hospice agencies. In July, SimiTree launched Sara, an AI tool designed to improve clinical documentation review, coding accuracy and operational efficiency for home health agencies.
Sheridan is a healthcare-focused firm and is focused on the lower mid-market. “That’s been consistent since day one, as is this idea of backing founder-led businesses and being the first institutional capital,” Lewis said. “As we underwrite different theses across the healthcare landscape, we focus on tech-enabled and outsourced services, medical products and manufacturing, providers and provider services, as well as software and technology.”
In 2024, PE Hub highlighted five deals in healthcare RCM.