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Home health company Gentiva Health Services’ planned purchase of Odyssey Healthcare, a hospice provider, will send ripples through the aging services industry, analysts told Investor’s Business Daily.

The $1 billion acquisition, which came to light last week, indicates more convergence and consolidation across the aging services spectrum, which includes nursing home care and assisted living, a Morningstar analyst told the news outlet.

Another analyst said the transaction is a wise strategy as the Centers for Medicare and Medicaid Services continues to cut back on payments. Industry operators merging with other providers can spread costs, such as administration, marketing and purchases, over more locations, the analyst said.