Residential Intellectual and Developmental Disability Facilities (NAICS 62321)

A Histometrics industry-level primer for public- and private-market investors

This level equals its one child. NAICS (North American Industry Classification System) code 62321 is a five-digit industry that contains a single six-digit national industry, 623210, Residential Intellectual and Developmental Disability Facilities. Because there is exactly one child, this level is effectively identical to it: same scope, same firms, same statistics. 623210 primer.

1. Overview

This industry houses and supports adults and children with intellectual and developmental disabilities (IDD), conditions such as autism, Down syndrome, and cerebral palsy, in staffed residential settings rather than in a family home. The dominant format is the small community group home (often 1–6 residents) with round-the-clock direct-support staff; a shrinking minority live in larger, more medical Intermediate Care Facilities for Individuals with Intellectual Disabilities (ICF/IID).[9]

This is a large, non-cyclical, government-funded human-services sector with structurally rising demand and a chronic supply shortage. Almost all revenue comes from Medicaid (the joint federal-state health program for low-income and disabled Americans), which makes cash flows stable and recession-resistant but caps pricing and ties fortunes to state budgets.[8] Ownership is overwhelmingly private (private-equity-backed national operators, large regional nonprofits, and thousands of small owner-run homes), so the public-market menu is thin and, after a 2026 divestiture, thinner still.

2. What's inside — and why this level equals its one child

The five-digit industry 62321 rolls up a single national industry:

When a NAICS industry has just one national industry beneath it, the two are definitionally the same economic activity; the extra digit adds no further breakout. So everything true of 623210 is true of 62321. The classification is narrow: it captures only the residential-facility slice of a much larger IDD-services economy and excludes non-residential day, vocational, and in-home supports (NAICS 624120), residential mental-health and substance-abuse care (623220), and skilled-nursing and elder-care settings (623110, 623311/623312).[9] Child primer: 623210.

3. Size (this level's rollup figures)

Federal statistics for NAICS 62321 match 623210 exactly, as expected for a single-child level.

The Herfindahl-Hirschman Index (HHI, a standard market-concentration measure) is suppressed in the source data, so we do not report it.[2] Note the vintage mismatch: receipts and concentration are 2022 (Economic Census), while payroll and employment are 2023 (County Business Patterns), so the two blocks are not perfectly comparable.

Undercount caveat (matters here). The $37.8 billion receipts figure materially understates total public spending on residential IDD supports. County Business Patterns (CBP) and the Economic Census cover employer businesses (including nonprofits) but generally exclude government-operated establishments, so state-run developmental centers and county group homes are largely absent.[5] Tiny family-care, adult-foster, and host-home arrangements with no paid employees also fall outside employer statistics. And most IDD services are non-residential and sit in other NAICS codes. For scale, Medicaid provides long-term services to roughly 729,000 people with IDD, at about $50,000 a year for a single working-age adult — implying total public IDD long-term-care spending well into the tens of billions, far above this one residential line item.[8] Treat these figures as an employer-business baseline, not a complete measure of care activity.

4. Investable universe (where value concentrates)

Because the level equals its one child, the investable map is identical to 623210's. In brief: there is no clean U.S.-listed pure-play residential IDD operator today. BrightSpring Health Services (Nasdaq: BTSG) sold its ResCare Community Living division, the pure IDD residential business, to Sevita for $835 million in March 2026, removing the last large near-pure-play from the public markets.[11][12] Remaining listed exposure is indirect: adjacent personal-care operator Addus HomeCare (Nasdaq: ADUS), and the Medicaid managed-care payers Centene (NYSE: CNC), Molina (NYSE: MOH), and Elevance (NYSE: ELV).[19][16][17][18]

The real ownership is private and concentrated among a handful of national platforms atop a long tail of small operators: Sevita (owned by Centerbridge Partners and The Vistria Group; the largest national provider), Dungarvin, and private-equity-backed RHA Health Services, alongside large regional nonprofits (Bancroft, Benchmark Human Services, Mosaic, and local chapters of The Arc and Easterseals).[5][6][18] Child primer: 623210.

5. How the money works

Owners earn a Medicaid rate (a Home- and Community-Based Services (HCBS) waiver residential rate or an ICF/IID per-diem) for each authorized resident, so revenue = funded slots × occupancy × reimbursement rate. Fixed rent and minimum staffing make occupancy (census) the single most important operating lever, as in a hotel or nursing home.[2] Labor is the business: hourly Direct Support Professionals (DSPs) drive roughly 70%+ of revenue, illustrated by the industry's $21.8 billion payroll against $37.8 billion of receipts.[1][2] The core tension is the rate-to-wage gap: states set reimbursement, but operators must pay a competitive wage in a tight labor market, which keeps margins thin (low-to-mid single digits) and makes consolidation and real-estate ownership the main routes to for-profit returns.

6. Demand drivers

Demand is structurally rising and largely disconnected from the economic cycle: more than 710,000 people sit on Medicaid HCBS waiting/interest lists (about 73% with IDD, average wait ~50 months); nearly one million U.S. households include an adult with IDD supported by an aging caregiver whose adult child will eventually "age into" the system; and autism and other diagnoses, longer lifespans, and higher acuity keep expanding the eligible population.[3][8] The binding constraint is not demand but funding and workforce: how many waiver slots states pay for and how many DSPs operators can hire. Child primer: 623210.

7. Regulation

Government rules effectively create this market. The Centers for Medicare & Medicaid Services (CMS) and state Medicaid agencies fund and govern nearly the whole sector, setting rates, licensing facilities, and running the Section 1915(c) HCBS waivers.[14] The Olmstead v. L.C. (1999) Supreme Court decision and the CMS HCBS Settings Rule (compliance deadline March 2023) drive the shift from institutions to community homes, while ICF/IID conditions of participation, the 2024 Medicaid Access Final Rule, and state licensing/incident-reporting add ongoing compliance burden.[14][15] Antitrust enforcement has arrived: in January 2026 the Federal Trade Commission (FTC) required Sevita to divest 128 ICFs before allowing the ResCare acquisition.[11]

8. Consolidation

A fragmented cottage industry consolidating from the top: 7,336 firms, with the four largest holding only 13.1% of revenue and even the top 50 under 30%.[2] A private-equity-led roll-up has run for a decade, acquiring sub-scale homes and centralizing billing, compliance, and HR overhead, but reimbursement is a hard price ceiling and operators compete for the same scarce workers, so scale helps only so far. The 2026 Sevita–ResCare deal, cleared only with FTC-mandated divestitures, signals the end of the unscrutinized roll-up era.[11][12]

9. Risks

The risks are those of 623210: reimbursement / Medicaid-budget risk (the dominant one, given near-total single-payer dependence); a chronic DSP workforce shortage (turnover near 40%, median wage ~$14.50/hour, with most providers turning away referrals for lack of staff); quality, safety, and reputational/legal exposure serving a vulnerable population; leverage at private-equity operators; and an antitrust ceiling on the growth playbook.[5][11][16] Federal employer statistics also understate government, nonprofit, and very-small-provider activity, a caution when sizing the market from these figures.

10. How to invest & outlook

No pure-play listed vehicle exists after 2026; public routes are indirect (diversified HCBS/pharmacy names such as BrightSpring, adjacent personal care via Addus, or payer-side exposure via Centene, Molina, Elevance).[11][19][16][17][18] The genuine exposure is private: operating platforms and regional providers, group-home real estate, private-credit lending, and staffing/technology vendors, underwritten state-by-state on licenses, waiver authorizations, staffing coverage, and rate adequacy.[5][18] The long-run demand case is about as durable as any in health care, but this is a government-rate-taking, labor-constrained, thin-margin business; the swing factors to watch are federal Medicaid policy, DSP wages and labor supply, and antitrust-shaped consolidation. The ground-truth data contain no national industry growth forecast, so none is supplied. 623210 primer.

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Sources

Drawn from the child primer (623210); numbering preserved for cross-reference.

1. U.S. Census Bureau. County Business Patterns, NAICS 623210, 2023. (Establishments 35,559; employees 545,820; annual payroll $21.76 billion; Q1 payroll $5.27 billion.) https://www.census.gov/programs-surveys/cbp.html
2. U.S. Census Bureau. 2022 Economic Census — Concentration by Largest Firms, NAICS 623210, 2022. (Firms 7,336; receipts $37.8 billion; CR4 13.1%, CR8 16.4%, CR20 21.9%, CR50 29.2%; HHI suppressed.) https://www.census.gov/programs-surveys/economic-census.html
3. KFF. A Look at Waiting Lists for Medicaid Home- and Community-Based Services from 2016 to 2024, 2024. https://www.kff.org/medicaid/a-look-at-waiting-lists-for-medicaid-home-and-community-based-services-from-2016-to-2024/
4. Stateline / The American Prospect / S&P Global (via PESP). Private equity in disability services; Sevita ownership, revenue, and leverage, 2025. https://stateline.org/2025/05/16/private-equity-snaps-up-disability-services-challenging-state-regulators/
5. Dungarvin. Company overview / About Us, 2026. https://www.dungarvin.com/about-us/
6. KFF. 5 Key Facts About Medicaid Coverage for People With Intellectual and Developmental Disabilities (IDD), 2024. https://www.kff.org/medicaid/5-key-facts-about-medicaid-coverage-for-people-with-intellectual-and-developmental-disabilities-idd/
7. U.S. Census Bureau. 2022 NAICS Definitions — 623210 and adjacent codes (623220, 623110, 623311/623312, 623990, 624120), 2022. https://www.census.gov/naics/?input=623210&year=2022&details=623210
8. U.S. Federal Trade Commission. FTC Takes Action to Prevent Anticompetitive Healthcare Services Merger (Sevita / ResCare), January 2026. https://www.ftc.gov/news-events/news/press-releases/2026/01/ftc-takes-action-prevent-anticompetitive-healthcare-services-merger
9. Home Health Care News / BrightSpring. BrightSpring Finalizes $835M Community Living Divestiture to Sevita, March 2026. https://homehealthcarenews.com/2026/03/brightspring-finalizes-835m-community-living-divestiture-to-sevita/
10. Centers for Medicare & Medicaid Services (CMS). HCBS Authorities (Section 1915(c)); Institutional Long-Term Care / ICF-IID; Olmstead v. L.C. (1999), 2024. https://www.medicaid.gov/medicaid/home-community-based-services/home-community-based-services-authorities
11. KFF. How Are States Implementing New Requirements for Medicaid HCBS? (HCBS Settings Rule, effective March 2023), 2024. https://www.kff.org/medicaid/how-are-states-implementing-new-requirements-for-medicaid-home-and-community-based-services/
12. ANCOR. The State of America's Direct Support Workforce Crisis (2024–2025). (Turnover near 40%; median DSP wage ~$14.50/hour; 77% of providers turned away referrals.) https://www.ancor.org/resources/the-state-of-americas-direct-support-workforce-crisis-2025/
13. Blue Wolf Capital Partners. Blue Wolf Capital Acquires RHA Health Services, 2019. https://www.bluewolfcapital.com/wp-content/uploads/2019/08/08.05.19.RHA-Press-Release.pdf
14. Centers for Medicare & Medicaid Services. Ensuring Access to Medicaid Services / HCBS Provisions (2024 Access Final Rule), 2024. https://www.medicaid.gov/medicaid/access-care/home-and-community-based-services-provisions
15. Electronic Code of Federal Regulations. 42 CFR Part 483, Subpart I — Conditions of Participation for ICF/IID, current. https://www.ecfr.gov/current/title-42/chapter-IV/subchapter-G/part-483/subpart-I
16. Centene Corporation. 2025 Form 10-K, 2026. https://www.sec.gov/Archives/edgar/data/1071739/000107173926000049/cnc-20251231.htm
17. Molina Healthcare. 2025 Form 10-K, 2026. https://www.sec.gov/Archives/edgar/data/1179929/000117992926000005/moh-20251231.htm
18. Elevance Health. 2025 Form 10-K, 2026. https://www.sec.gov/Archives/edgar/data/1156039/000115603926000013/elv-20251231.htm
19. Addus HomeCare Corporation. 2025 Form 10-K, 2026. https://www.sec.gov/Archives/edgar/data/1468328/000143774926005352/adus20251231_10k.htm