Concentra Operating 8-K Regulation FD Disclosure

Concentra Inc.

Concentra Inc.

Credit Suisse 2006 Global Leverage Finance

Credit Suisse 2006 Global Leverage Finance

Conference

Conference

March 29, 2006

March 29, 2006

Exhibit 99.1

2

Forward-Looking Information

Forward-Looking Information

This presentation contains certain forward-looking statements, which the

Company is making in reliance on the safe harbor provisions of the Private

Securities Litigation Reform Act of 1995.  Investors are cautioned that all

forward-looking statements involve risks and uncertainties, and that the

Company’s actual results may differ materially from the results discussed in the

forward-looking statements.  Factors that could cause or contribute to such

differences include, but are not limited to, the potential adverse impact of

governmental regulation on the Company’s operations; changes in nationwide

employment and workplace injury trends; interruption in its data

processing

capabilities; operational, financing, completion and strategic risks related to the

Company’s capital structure and growth strategy; possible fluctuations in

quarterly and annual operations; possible legal liability for adverse medical

consequences; competitive pressures; adverse changes in market conditions

for the Company’s services; inability to complete planned acquisitions; and

dependence on key management personnel.  Additional factors include those

described in the Company’s filings with the Securities and Exchange

Commission.  The Company undertakes no obligation to update any forward-

looking statements or to make any other forward-looking statements, whether

as a result of new information, future events, or otherwise.

3

Agenda

Agenda

Overview of Concentra

Overview of Concentra

Financial Performance Trends

Financial Performance Trends

Key Considerations

Key Considerations

Questions & Answers

Questions & Answers

Overview of Concentra

Overview of Concentra

Overview of Concentra

5

Concentra’s Mission

Concentra’s Mission

“Improving quality of life by making

“Improving quality of life by making

healthcare accessible and affordable”

healthcare accessible and affordable”

6

Company Highlights

Company Highlights

Concentra has established a consistent record of earnings and cash flow

Concentra has established a consistent record of earnings and cash flow

growth since going private in 1999, resulting from

growth since going private in 1999, resulting from

–

–

Diversification of business segments with multiple avenues for growth

Diversification of business segments with multiple avenues for growth

–

–

Broad base of customers

Broad base of customers

–

–

Continual reduction in days sales outstanding

Continual reduction in days sales outstanding

–

–

Demonstrated management of capital expenditures

Demonstrated management of capital expenditures

–

–

Ability to successfully withstand economic cycles

Ability to successfully withstand economic cycles

–

–

Growing levels of retained cash

Growing levels of retained cash

In 2005, Concentra completed the acquisitions of Beech Street Corporation

In 2005, Concentra completed the acquisitions of Beech Street Corporation

and Occupational Health + Rehabilitation

and Occupational Health + Rehabilitation

Pro forma for these acquisitions, the Company generated revenue and

Pro forma for these acquisitions, the Company generated revenue and

EBITDA of $1.3 billion and $178 million, respectively in 2005

EBITDA of $1.3 billion and $178 million, respectively in 2005

7

Business Overview

Business Overview

Concentra is increasingly being recognized as the nation’s leading

Concentra is increasingly being recognized as the nation’s leading

healthcare outcomes and cost improvement company

healthcare outcomes and cost improvement company

Concentra is the market leader in the United States in:

Concentra is the market leader in the United States in:

–

–

Reducing the cost of out-of-network medical expenses

Reducing the cost of out-of-network medical expenses

–

–

Disease management of injured workers and workers’

Disease management of injured workers and workers’

compensation

compensation

cost management

cost management

–

–

Controlling the cost of auto injury claims

Controlling the cost of auto injury claims

Concentra has strong long-term relationships with employers, insurers and

Concentra has strong long-term relationships with employers, insurers and

TPAs

TPAs

–

–

Proven ability to produce superior patient outcomes and deliver cost

Proven ability to produce superior patient outcomes and deliver cost

savings to its customers through extensive clinical experience

savings to its customers through extensive clinical experience

–

–

Leveraging of market knowledge, advanced IT systems and customer

Leveraging of market knowledge, advanced IT systems and customer

relationships to deliver broad cost containment services

relationships to deliver broad cost containment services

8

Payor/

Payor/

Employer

Employer

Employee/

Employee/

Patient

Patient

Provider

Provider

Medical Costs

Group Health, Workers’

Group Health, Workers’

Compensation, Employer Health & Auto Markets

Compensation, Employer Health & Auto Markets

Injuries

& Illness

Benefits &

Lost-time Wages

Traditional Healthcare Environment

Traditional Healthcare Environment

9

Payor/

Payor/

Employer

Employer

Employee/

Employee/

Patient

Patient

Provider

Provider

Medical Costs

Injuries

& Illness

Benefits &

Lost-time Wages

Concentra

Concentra

Quicker

Recovery

Improved

Outcomes

Reduced Cost

Concentra is at the Center of Improving

Concentra is at the Center of Improving

Outcomes and Reducing Costs

Outcomes and Reducing Costs

Group Health, Workers’

Group Health, Workers’

Compensation, Employer Health & Auto Markets

Compensation, Employer Health & Auto Markets

10

($ in millions)

($ in millions)

(1) Excludes corporate expenses of approximately $33 million.

(1) Excludes corporate expenses of approximately $33 million.

Segment Financial Profile

Segment Financial Profile

Concentra

TTM

12/31/05

Revenue

$1,155

TTM

12/31/05

EBITDA

$165

Margin

14%

Health

Services

TTM

Revenue

$667

TTM

EBITDA

(1)

$96

Margin

14%

Network

Services

TTM

Revenue

$286

TTM

EBITDA

(1)

$87

Margin

30%

Care

Management

TTM

Revenue

$202

TTM

EBITDA

(1)

$16

Margin

8%

11

Primary Service Offerings

Primary Service Offerings

Over 300 health centers nationwide

providing:

–

Treatment of work-related

injuries and illnesses

–

Physical therapy

–

Pre-placement physicals

–

Drug and alcohol testing

Rapidly growing Diversified Services

–

Pharmacy management

services

–

Over 200 employer on-site

locations

Workers’

Compensation

Auto Insurance & Other

Group Health

Employer

Health

Employers & Payors

Employers & Payors

National PPO networks for

Group Health and Workers’

Compensation with primary and

“wrap”

products

Review, repricing and reduction

of medical bills received by

insurance companies and other

payors

Savings to clients achieved

through fee negotiation, bill

repricing and access to PPO

networks

Health Services

Care Management

Network Services

Professional services aimed at

reviewing and resolving cases

that have been outstanding for

extended periods of time,

including:

–

Case management

–

Independent medical

exams

12

Integrated Delivery Model

Integrated Delivery Model

Health Centers

Highly-Steered Networks

Primary PPO, Wrap Networks,

Out of Network

Care Management

13

Markets and Customers Served

Markets and Customers Served

Group Health

15%

Workers'

Compensation

64%

Employer

Health

17%

Auto Insurance and

Other

4%

Markets Served

190,000 Employer

Locations

57%

3,700 Insurance

Companies, TPAs

and Other Payors

43%

Customers Served

Note: Percentages based on 2005 pro forma data.

Note: Percentages based on 2005 pro forma data.

14

Medical cost inflation of 8% to 10%

6.5 million injuries occur each year

Tremendous inefficiencies

Workers’

compensation benefits

include:

–

Indemnity: portion of lost wages

–

Medical: lifetime medical costs

resulting from work-related injuries

Guaranteed reimbursement to

healthcare providers in all

states

Regulations vary by state

Administrative

Costs

16%

Medical Costs

19%

Wages & Lost

Productivity

65%

$142.2 Billion

Source:

National

Safety

Council

Injury

Facts

-

2004

Edition

Source:

National

Safety

Council

Injury

Facts

-

2005

Edition

Workers’

Workers’

Compensation Market Today

Compensation Market Today

15

Commercial market consists of more than $700 billion in-network and $65

Commercial market consists of more than $700 billion in-network and $65

billion out-of-network claims per year

billion out-of-network claims per year

Group health payors are increasingly looking for solutions that help them

Group health payors are increasingly looking for solutions that help them

more efficiently and effectively manage claims that fall outside

more efficiently and effectively manage claims that fall outside

their

their

proprietary networks

proprietary networks

Small group payors looking for attractively priced provider networks and an

Small group payors looking for attractively priced provider networks and an

efficient bill repricing engine to compete with Blue Cross plans

efficient bill repricing engine to compete with Blue Cross plans

Recent sales and growth have accelerated in part due to Beech Street

Recent sales and growth have accelerated in part due to Beech Street

acquisition

acquisition

Group Health

Group Health

16

Developing market with nearly $2 billion in claims currently available for bill

Developing market with nearly $2 billion in claims currently available for bill

review, network and case management services

review, network and case management services

Concentra provides a full complement of integrated services and employs

Concentra provides a full complement of integrated services and employs

experienced personnel dedicated to auto injury services

experienced personnel dedicated to auto injury services

Programs are outcomes-oriented

Programs are outcomes-oriented

and demonstrate control over claims

and demonstrate control over claims

severity

severity

Auto Injury Services

Auto Injury Services

17

Major Insurance Carriers and Health

Plans

Aetna

AIG

Allstate

Blue Cross Plans

CIGNA

CNA

Hartford

Health Net

Humana

Liberty Mutual

Pacificare

Safeco

St. Paul Travelers

Texas Mutual

United Healthcare

USAA

Major Employers

Albertsons

Coca-Cola

FedEx

Hilton Hotels

Home Depot

Southwest Airlines

UPS

US Postal Service

Wal-Mart

Major TPAs

Ace –

ESIS

Broadspire

Cambridge

Gallagher Bassett

Hartford -

SRS

Sedgwick

Concentra

has

achieved

a

high

rate

of

customer

retention

and

has

low

revenue

Concentration

(no

single

customer

represents

more

than

5%

of

revenues).

Stable and Growing Base of “Blue Chip”

Stable and Growing Base of “Blue Chip”

Customers

Customers

Financial Performance Trends

Financial Performance Trends

Financial Performance Trends

19

Revenue and EBITDA Growth Trends

Revenue and EBITDA Growth Trends

$991.3

$1,041.9

$1,095.9

$1,151.1

$1,350.0

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

2002

2003

2004

2005

2006E

($ in millions)

($ in millions)

Margin:      12.4%      14.6%      14.0%       14.3%     14.1%

(1)

(1)

Revenue

Revenue

EBITDA

EBITDA

(1)

Represents

the

mid-point

of

the

Company’s

current

forecast

for

2006

as

of

February

14,

2006.

$123.4

$153.3

$154.8

$165.0

$190.5

$0

$50

$100

$150

$200

2002

2003

2004

2005

2006E

20

Days Sales Outstanding

Days Sales Outstanding

51

62

82

79

73

59

62

50

55

60

65

70

75

80

85

1999

2000

2001

2002

2003

2004

2005

21

Operating Cash Flow

Operating Cash Flow

$28.3

$36.0

$79.4

$56.0

$113.6

$98.9

$141.8

$95.0

$0.0

$20.0

$40.0

$60.0

$80.0

$100.0

$120.0

$140.0

1999

2000

2001

2002

2003

2004

2005

2006E

($ in millions)

($ in millions)

(1)

(1)

Represents

the

mid-point

of

the

Company’s

current

forecast

for

2006

as

of

February

14,

2006.

22

Capital Expenditures

Capital Expenditures

$36.0

$32.0

$45.8

$35.1

$29.6

$27.9

$49.1

$47.5

$0.0

$10.0

$20.0

$30.0

$40.0

$50.0

$60.0

$70.0

1999

2000

2001

2002

2003

2004

2005

2006E

($ in millions)

($ in millions)

% of revenue:               5.2%         4.2%         5.3%  

3.5%         2.8%         2.5%         4.3%         3.7%

(1)

(1)

Represents

the

mid-point

of

the

Company’s

current

forecast

for

2006

as

of

February

14,

2006.

23

5.4x

6.5x

4.9x

6.0x

4.6x

5.8x

3.9x

5.8x

4.3x

4.7x

4.7x

5.1x

4.8x

5.2x

4.6x

5.0x

0.0x

1.5x

3.0x

4.5x

6.0x

7.5x

1999

2000

2001

2002

2003

2004

2005

2005

PFM

Proven Track Record of Managing Indebtedness

Proven Track Record of Managing Indebtedness

TTM EBITDA:    $104.7     $115.5    $123.6     $123.4    $153.3

$154.8    $178.4    $178.4

($ in millions)

($ in millions)

Concentra Operating Corp               Concentra Inc.

Concentra Operating Corp               Concentra Inc.

(1)

Reflects $31.6 million prepayment of Senior debt made up of $14.1 million related to the excess cash flow produced in 2005 as

required in the covenants of the Company’s Senior Credit Facility and $17.5 million in voluntary prepayments.

(2)

Includes results for Beech Street and OH+R for the entire year as if the acquisitions had occurred January 1, 2005.

(1)

(2)

(2)

24

Diversified and growing base of operating cash flows

Diversified and growing base of operating cash flows

Strategic investment in new business initiatives and capital expenditures

Strategic investment in new business initiatives and capital expenditures

Proven track record of deleveraging and managing indebtedness

Proven track record of deleveraging and managing indebtedness

Key Financial Highlights

Key Financial Highlights

Conclusions

Conclusions

Conclusions

26

Concentra is a nationwide leader in providing solutions to improve the quality

Concentra is a nationwide leader in providing solutions to improve the quality

and effectiveness of healthcare and disability costs

and effectiveness of healthcare and disability costs

Company continues to expand its service offerings and increase its market

Company continues to expand its service offerings and increase its market

penetration in existing businesses

penetration in existing businesses

The

The

strategic

strategic

acquisitions

acquisitions

of

of

Beech

Beech

Street

Street

and

and

OH+R

OH+R

will

will

further

further

expand

expand

Concentra’s

Concentra’s

market

market

presence

presence

and

and

increase

increase

savings

savings

to

to

its

its

customers

customers

Concentra is well-positioned to benefit from a diversified product line and its

Concentra is well-positioned to benefit from a diversified product line and its

focus on cost control provides significant operating leverage

focus on cost control provides significant operating leverage

Key Considerations

Key Considerations

Questions & Answers

Questions & Answers

Questions & Answers