ACHC - Earnings call transcript Q3 2024 | Acadia Healthcare Company, Inc.

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Operator

Good day. and welcome to Acadia Healthcare's Third Quarter of 2024 Earnings Call. [Operator Instructions] Also, please be aware that today's call is being recorded. I would now like to turn the call over to Patrick Feeley, head of Investor Relations. Please go ahead.

Patrick Feeley

Thank you, and good morning. closed, XXXX a financial market our release the quarter third results. after we press issued announcing Yesterday This press release Relations section can be found the website. in acadiahealthcare.com of the Investor

Commission Hunter, discuss Here is statements, factors, reconciliation of may today others, the in of forth find others, directly today's on comparable and and Act expected quarterly calculated results extent to for including important measure the Exchange financial statements results Securities from contain the like over company's to may Dickson, financial as materially the the call, press in beyond. Private Chief financial Officer. To Executive as non-GAAP turn our that release filings discussed These results the news forward-looking differ posted GAAP may Chief operations Reform quarter the Acadia's among with XXXX, measure Financial the Officer; to consequently, a are of to is within me annual any meaning well yesterday that most website third the you afternoon. This filed actual Heather by in and this according and Securities regarding release forward-looking time, also Chris measure, and the performance and XXXX with set Acadia's call statements. At I'd affected in in XX-Q statements among the Chris. to call the be discussed will conference and Litigation the

Christopher Hunter

Call. for morning, you us being XXXX Thank for Conference everyone. Third Thank and Acadia's good you, Patrick, with Quarter

how and outcomes that the a are how legal high-quality drive update. update I'll want the but the needs access to we then lot populations it. and provide a quality expanding desperately begin close a for key patient here on we with for Acadia, standard population our today, we vulnerable serve discussion of have to will broader with at We followed results quarter. our a cover of highlights I care by I to

XX.X% adjusted last same reported representing over EBITDA against results continued by our to total operating targets. led maintain of growth. we the and growth million, around XXXX, costs retention strong with in the growth of with and Underlying of X.X% quarter, line improvement rate consistent solid trend made top labor combined attract talent. We've engagement $XXX our helped quarter of growth favorably day revenue leverage have over recruitment, During patient year. both to also third This the third initiatives and driven bed progress quarter growth

this Health treatment, we about seriously. With construction standards Intermountain on communities. exceed in wholly only recent We fourth and are operate requires at role behavioral patients, as we compassionate how new take well Denver, Acadia, Henry from beds amongst pace on facilities. in risk regulation how venture the Health in underserved. several owned nation's but This includes to hospitals compliance. At the XXX joint and including year, accurate to a and serve behavioral to improves as aim this with our new health partnerships and complete to opportunity we that and quarter care Novo they reports Detroit Colorado fourth expected We respect facilities earlier we in an Ford approximately over you most beds completed important provide inspires and to play mission facilities truly in populations is And patient care and hope to role also ongoing are about media acute X,XXX the that for you existing want nearly in Creator and more to our supporting year, XXX acute facility in to the that I'd month. We're quarter. XXX that Madison, like in facilities, to not beds that, these this was incredibly our track Wisconsin, lives, safety take consider over elevates With health the quality, addiction our the and to including add our commitment about remind when meet, on share

First, I systematically want false, do patient that The care. when These for and made directly to associated patients necessity it necessary against is Acadia. than adhere holds everything and licensed we decisions decisions stand care be at patient are legal comes clear, requirements. medical by all and providers medically longer allegation drives to goes to Acadia

the their country. to help X improves Americans families. We day, the our serious X in mental in health response crisis and government mission compassionate XX% that greater illness Americans and not health employees fulfill Acadia's importantly never States care. high-quality highly is below the facilities. Behavioral in of complex, already clear has in it still hospitals X is the United X you've acadiahealthcare.com. and It mental shows more nonprofit live severe which of in lives care, are average is that but And need with at and that for in provide health has of those patients the that that impacts every industry I the data run our If receiving our so, family psychiatric -- done that average fact you and beds nation It's fewer operate health given is our includes than quality behavioral supervised a disease most read length comparable been subsectors illness capita of X every regulated across to no the with encourage than in estimated care a per faces. mental with would countries. line Acadia treatment, XX,XXX stay our yet

third-party facilities, Xx and our in consider at care, Our just a inspections psychiatric inspection such all to the of parties third routing local billing. To organizations, retroactive place are with but aspects CMS Like ranges agencies, audits, the facilities, per after compliance with of robust been are from to efforts government is payers, by internal to guidelines of including subject patient agencies, oversight subject independent chart this requirements, make type oversight programs. They that and routinely reviews to hospitals to per and year. both to stays. during that part of of practices patient our ensure matters, compliance by roughly This to well-run and subject our management and third-party state agencies with on past our own ensure within acute best X hospital clinicians of from in reviews limited, CMS not routinely and facilities, are routine utilization Commission, to taking years, before, our regulatory various give the payers is hospitals that reviews, clinicians documentation oversight these including, over Joint part regulatory life-saving own important chart surveys also sense decisions on oversight want providers work to audits. critical receive about oversight available. The you provider a clinicians an help the basis. routine must difficult as routinely and care payer do subject patients have daily other average often and we I stress various care

and brief industry incredibly update. legal hold important or miss standard, even is it ineffective criteria, standard. With we an believe that that, follow At ourselves and is care discharge also clinicians Acadia, clinically harmful. perpetuate to provide psychiatric driven a high admission to not We I'll

of a for length U.S. in of we voluntary request As as the month, related September, Office to York stay Attorney's from U.S. billing practices. Southern New a District Missouri received for we last admissions, well the information subpoena the District District Court the as for from disclosed of Western and

documents a from its On Southern District X subject of of the care Missouri the voluntary the the of Justice, time, matter. Since and subpoena withdrawn Missouri issued hospitals which the since has original Western the is has of Furthermore, from both York to District that District and of received information Department same on a company request. permitting day, our those subpoenas basis. regarding of withdrawn also subpoenas New similar Western acute produce the

government The multiple for similar ongoing. which receive we Justice reasonable efforts and organization departments a of matters, enforcement, of make is law agencies behalf Department the and the investigating tasked the and the request. federal received federal in the as may agencies requesting from company own information, assume the requests As other long could any SEC federal of investigation is leading recently with their coordinating on from that as similar subpoena information future additional it's to within

XXXX. also effort our quality, are to This engaged joined practices good will fully work experience care simply strongly we all safety, best quality new. We important believe to from I share patient only the and our everything regulatory and quality that not like and back interest standpoint, compliance We continue and through in company to the in a since of some process. We updates is on that but is stakeholders. I'd not believe this focus are business do. foundational

have those will who spending approximately coordination. investments that as care staff in to For incremental $XXX as enhance augment covered technology in may we recall you for and while, patient us XXXX, safety committed a well million to

wearable care our have sure for job doing remote hospitals systems wearable technology employ the can today implemented acute we're safe. Similarly, a monitoring hospitals result, patients safety of our make we As patient best response operations requirements. and including to solutions software with expedited provide regulatory We've at staff on quality that facilities, and adverse that clinical our times tracking of implemented and also mitigation enables real-time oversight compliance events. keeping

Act, Tech facilities provided excluded health from psychiatric in which hospitals You physicians funding will were also records. and billions implementation that for XXXX High recall to the of electronic the specifically

granular review, patient found they Commission leverage which Part enabling simplified our in enabling access other X the medical very an hospitals. the well Joint time areas acute separated review the best past in committee result, specialized ago, Acadia, by of and charts, a analytics we health psychiatric a over while of review providers include more facilities peer a quality across teams. years best, our all we to parts that care what have efficient our been of spend provide to other focusing facilitated enhancing to reviews clinicians ability care, lagged care is EMRs focus. more unacceptable on as are the executive and on do implementing as highlight X to much our in and with patient distinct a of industry. At care. EMRs a and electronic of the of compliance quality basis our This few data X As into and place. To records doing years, information prevalence has

while direct on including provides patient Our clinical accurate and Officer, Officer and Chief Quality program, coding our Medical initiatives oversight oversight compliance chart ensure quality regulatory ongoing Chief of audits to provide compliance Officer billing. and documentation, corporate our Compliance Chief safety, direct

better care, also hold monthly in quality result feeling These quality commitment from instance, and for their implemented largest lives hospitals. involuntarily to as and facilities admitted of year, patients. In X care XX% seen are center hopeful And our implemented have speaking surveys, to of past resulting in to to patients members briefly we payers of Over better dashboards quality. expanding a designation the reviews of last our accountable excellence to in they and of the payer responded Many reported for years, outcomes as by respondents conclude have received hospitals treatment. well. XXXX, results the market. I'd follow-up partners our about these our ongoing life-saving across leaders better our received who including the our access have some for like our efforts

remain deaths there in health care in of our to all-time in for highs. According or the XX,XXX behavioral As suicide the I at died a significant CDC, related Americans XXXX. States Behavioral remains country. unmet services United noted, health need near

in required During country and of industry Meanwhile, estimated benchmarks psychiatric result based needs. inpatient decades fragmented unable nearly number drug country that simply, XXX,XXX get deaths. available the the decreasing, and remains care on a million Americans than clinical of gap creating who underfunding standard supply-demand Americans the underinvestment it's beds treatment. due XX,XXX to additional to those illness health care according this while estimated broadening been no to are And is overdose to with the the that most more health has that meet a beds year, exacerbated receive has the same need SAMHSA, patients increasing leaving approximately Put in XX of need mental died mental behavioral for underbedded, imbalance. Notably, it. across

years. so the attractive expect the to desperately that in of needed will This and So high-quality new of to capacity over to over an expand the beyond. bed investing need, be use of remain X care Acadia meet is beds the in behavioral we including access process years, volume over several access next country. committed of to dollars that billions drive XXXX construction help capital, expand growth to X,XXX to the in expected is continues and investing next We accelerating this

also fund we've been facilities. done not deploy utilization. resources a close more patient facilities case, has to could if viability as where action That will strong be or time, cannot or we always use and of path an be is the historically, deployed Finally, resources irresponsible acutely time Therefore, there take from that we indefinitely to to needed. would

During in markets satellite over discuss results for that and the programs the X quarter to close like financial of I'd that, the subscale third quarter, guidance. we turn our our XXX decision made together, X to call comprise beds. With to to Heather the forward

Heather Dixon

everyone. good Chris, Thanks, morning, and

XXXX, increase X.X% patient the grew X.X% of which, patient with day, CTC reported the per in For included third third over recall, patient last quarter third in $XXX quarter, day X.X% we the have the . Same an increase an quarter will which X.X%. representing revenue per of of and excluding as year. revenue X.X%. million compared business, facility does associated day days growth of increased patient of not you Revenue revenue,

impairment. basis, income stockholders year, year's provider for relief quarter to Acadia, allocation share year. quarter diluted XXXX release year of make XXX adjustments third an previous transaction, quarter position was Maintaining period, in basis XXXX. Consistent legal on provider from margin for income year the with a Acadia strong $X.XX the same XX EBITDA XX.X% a million, of the and for periods, top quarter disciplined for prior capital fund investments prior providing financial of quarter remains $XXX.X the from EBITDA XX.X%, line increased income excluding flexibility per support points. On points for our relief and both XXXX. adjusted and XX.X% XX.X% third third basis with to from the funds growth. the last was provider the loss include continued income to Adjusted to income over in the same-facility Adjusted the current of our the expansion third of excluding the margin Adjusted with and XXXX compared fund the that in other costs last priority quarter attributable to increased strategic over a are strategy excluding prior EBITDA the

under ratio cash with a $XXX equivalents September XX, and million cash we in credit had of $XXX.X As million XXXX, available X.Xx. revolving $XX.X approximately million facility and leverage of our net

XXXX. on Moving outlook to for our

billion, $X.XX our in our we share noted updated earnings guidance range year, to press range range adjusted in of in $XXX of which the As the announced previously of release, per $X.XX to the and have EBITDA $XXX for $X.XXX to million, includes revenue in adjusted diluted the billion million $X.XX.

facility mid-single-digit year, quarter we earnings half to second coming same the call, As on the growth into of the back into we expect the accelerate patient discussed day range.

basis the over As half points XXX of X.X%, in of quarter of acceleration we day that results, in the achieved same you year. saw our growth facility patient an with first third the

lower we a have growth October, for X%, than approximately in growth day in volume September the that result we recent X% is the reporting above in headlines of of volume patient believe top facility media and experienced with remained the expected Chris same at of addressed month, the growth call. which the While

for XXX is quarter below our X%, quarter. expected fourth growth the previous approximately revised guidance of our X% to such, which to As points basis year-over-year same-facility reflects volume XXX expectations

referral million have $XX that million to with a change our local We some are addressing sources growth nature, fourth do the in to our quarter This communities doing engage and to in impact to expect be EBITDA continue arise. for as in $XX ensure to outlook these we any now, and time $XX we and million headwinds to $XX however, transitory our been guidance for outlook. resulted revenue we million they as a to volume concerns our impact our

structure million to we in Of fourth anticipated impact. to in recent note, anticipated of EBITDA guidance that disruption to run as the the the to growth $XX the potential expectation reduction the our EBITDA volume fourth cost as quarter updated $XX this quarter temporary. material believe do will million reductions make view do not rate be Therefore, not the reflects reflective response lower we to we

lower-than-expected costs we Should of we longer course, facility persist volumes than reduce will, level anticipate, accordingly.

future confident headwinds, time near these ACADIA the significant the as on acceleration are near-term Beyond we also for in in expansion. we highly capacity are of a cusp

This schedule able over result, expected construction As in next includes Chris approximately to of noted, of XXXX. also a under capacity pipeline first as we construction. an half ahead new beds beds been of of inpatient deliver large have of open We've nearly over the months, few the expansion our we which represents to X,XXX X,XXX to and facilities accelerate X%. projects certain expect multiple a

guidance this see reflected will expansion for capital revision expenditures. in our You

our Additionally, satellite our and programs markets third the year. of these exit half as $X subscale second Prior EBITDA million the revenue million guidance contribution from contemplated Chris reflects X revised guidance approximately during of approximately noted, quarter. the of X $XX of of year full the programs in contribution in

operator, other impact Finally, nonrecurring XXXX, XXXX divestitures, excludes contribution guidance and payments to questions. also the as ready call acquisitions, transaction, and we program, reminder, legal implementation. of The are the any any which will approval does include be company's Tennessee not legal a expect costs expense. With open payment we from supplemental X, guidance upon future to the July for or retroactive that, program, settlement

Operator

first A.J. this question, which [Operator will UBS. take Rice Instructions] our come time, At from we will with

Albert Rice

light Is granular, that in but this seeing in us as obviously, know the of is I growth volumes, -- question sort the of know -- pretty is dynamics. deceleration in give decent media obviously, still can is you'd you more. comments. the you're all this for growth, X% I Thanks but expect Obviously,

and in step is broad-based take have it seems on would concentrated to out like article markets stabilized? and the be? is And then of certain its through Or it I figure subsequent Or where where fourth more more Times And maybe part and down still quarter than focused it's New it a then X it's follow-up. you it had may subsequently has first York trying deteriorated the inquiries? that? as Did bottom you progress the the

Heather Dixon

step I'll the month down We Okay. we Thanks, the consistently throughout start question. the sort with the saw. at that for that did Thanks about saw of of your what October. beginning question pretty see run A.J. October. of step-down and And start we

of didn't answer we decline the month. to partners news early the do, we've So the working your as month days. regards volumes that have. We they question, that we of for the the continued investigation October. In some of a where see and this, the had we this saw with questions effect any your specific that mentioned, We growth to any moderating about or concentration relatively I throughout saw question of sort see on largely recent coverage our temporary, stable to identify it's expect as sort news and has been

Albert Rice

obviously those the that in some news of discussions just impact JV and there. of been have the seeing hard maybe your recruitment worked areas to clinicians from pipeline, you -- either the And you've got Okay. articles inquiries? get of Are in a number you've any announced, also and

Christopher Hunter

just Yes, is I JV pipeline. for robust have on really we Chris. the pipeline continue would to front, this say Thanks question. a the

XX some for have have multiple given and have too. we with that we're partners expect, those we would additional time, many talking facilities, we us remember partners, these adding that you actually been you have with that JV facilities about of As that

looks pipeline good. Our

attract with to continuing to questions there to And we're I think encouraged continuing come a about job been board. ability company that the employee on done talent. But the work our the employees have a talk the pipeline, I that's in we year, up. actually down I the hard making investments and think by think our retain as and this continue on really we've all front, well. clearly, across technology they're further good to are case engagement, as very that

Operator

Partners. will Our Mayo next Leerink from Whit with question come

Benjamin Mayo

could maybe to color think, they the more the just comments. preliminary Anything start-up the as 'XX? Tennessee the might provide I to to thoughts a preliminary just into I you appreciate around business. with tailwinds, bit around additions as costs if DPP was I accelerating headwinds, feather hoping any bed maybe heard growth thoughts that little I have you maybe Yes. XXXX. comments, guys mentioned, your share in Chris

Heather Dixon

that. take I'll Whit,

I'll finally, So I'll then rate. the about impact categories few with talk bed to of start-up additions. the costs maybe here. let me But start move question a then different about on your and and volume, And

going course, we're in another guidance little So for early It's of to give not that months. We'll few a give of today. that. sort

attempt won't but you going to my I give size I'm to thoughts. So of this, some

is quarter we've September Volume throughout we So the regards about second to quarter were year, X% quarter. of of in quarter, improvement the the an into and growth same-store what course the And that's the over as volume, volume we in growth back say rate. seen. I can to in first would talked growth the what we going you and the expectation third back the see, mid-single-digit volume then exited range, above volume improved

the remarks, saw as in we've to continued So believe prepared we have discussed that's acceleration X% we expected that And seen headlines above the we that X%, in that a points to would are seeing growth moderation in at October. below I volume September, that's reporting. in some basis through. And and while that XXX result the where about just we coming stayed we that But October expected growth run around again, be. of XXX to

As that's we think mentioned, we temporary.

but to year, we need then, forget, don't from volume XXXX, So of we exact Those last we will forward see XXXX. don't to look where in coming the online continue the benefit but are end to the new wait they'll of to to the added quarters a look continue contribute expect we'll that the the and beds to to know exit course expecting come from at ramp-up we perspective, ramp several and continued timing, track throughout know certainly, the the we continue back over and we would over through. as that be on course, quarters the growth of contribute come of to to as we the year. And beds

we incremental come we on based rate the seeing of volume a from continue that to good. perspective, will we're the beds. From So feel expect back the and combined now volume then what really with

As you lack that's next continuing psychiatric invest know, we're benefit timing the path as very we may care, the then but to once be states has There to of which can payers follow, program always is optimistic is the the are than suffered of have the just supplemental the that little those a less the year Tennessee. And other investment. the we are the conversations indications approved. timing continue net and our timing for in be that is clear are payments positive. Tennessee long from states with we'll of in And reimbursement, state improving on the that see to latest case, think uncertain.

X. For we retroactive Tennessee expect example, July will be to

to sort that, just have likely of be continue call on out it's and there's timing. to that and we but with associated approved, So to wait an once going the some we'll see out-of-period benefit

start-up we're doesn't past, normalize that back to as talk happen term. And maybe finally, to overall, but the short we low mid-single-digit like seem going about costs. it expect point at the range some we I'll continue to the the in said rates see future, in So to in then

investment this aware, to I over another in And all about you year, bed think pretty on we factor is cost embarked years. multiple have the significant growth know, we for are XXXX. in step-up start-up as As think the need that a you

And over last the bed year. And construction of X,XXX the and The currently bed on construction. XXX backfill end over this and additions pace the we've opportunities weighted X,XXX beds year we the we as of pipeline this then material prior the continue for course, construction we'll of we to expect total, that to Just a few were pull the XXX year pipeline complete year years beds this also over in things as under see, is year. reminder, we each. And in year's we as added of that towards have a in versus soon to discussed the step-up a full disproportionately have that back we can. February, additions finally, about

included flat our start-up back-end of we've start-up If million total, in costs for back-end guidance And XXXX relative fall as you'll XXXX to recall, timing. the the the initial talked to cadence. novos $XX to XXXX to de about loaded costs which XXXX $XX roughly in will class mostly around previously, million the was due due of

with new the step-up result part in in year early on that beds numbers of will us today, added year. doubling, too roughly to this that So costs of the number new the the being first in for provide a next starting Whit, beginning year, additions, too it. have of this hopefully, particularly But It's but to about on us at XXXX of those that how you specifics. because depend little a early of the to gives part to the think bed it's cadence openings and framework and a cost going the is amount least timing for in

be And by course breakeven bucket. XXXX, those next that them the beds EBITDA year. of Of course, we'll the also we'd by same be to And towards rolling to facility growth. expect will end expect the we'd contributing new ramp them of that point, over into the

costs of the they well. And past then the those several benefit So cohorts to over have beds expect of start-up decline. level XXXX, not to at years beyond the if we new volume throughout off, the period. to same And same-store we growth would that expect would ramping contribute continued outright would time, as

some. and was that a answered So question lot, gave Whit, I hope you that your

Benjamin Mayo

a I I of help $XX I million. within we $XX timing had any this we year. like this mean, to Yes, like to not million, as range $XX mean, is really. factors million really. of a like some as it to $XX of what good opening million, Not pretty you the idea see? $XX relates million mean have what could

Heather Dixon

appreciate the question. I No.

with it's the those coming to and year put pace I versus number Confluence a factors for last us the and the on moderate that of year ended next year, next the would just beds stack back from a are then more think it. and this early too how year timing up of I into this just point to cohorts sort year. beds

Operator

And our with will from next question Tanquilut Jefferies. Brian come

Brian Tanquilut

circling mean, Chris, to of partners. referral you sources like. looks obviously, the that your you're just through walk having JV conversations if lot back I sources, right? maybe us you referral can have a the with what So and

sources far, And behavior any feedback? referral in the you change are what's those at And so from this seeing point?

Christopher Hunter

mean, And sometimes as be engaged Yes. these Thanks referral being with health mean, the last we across outreach, country, due sources for would stakeholders. many on key with to been sources shore to of mean, of misunderstandings we've months. I media ground I think, I really I have so the reporting. had well particularly imagine, say the outreach can even we've deliberate local. to care Brian. literally case multiple the thousands know is as also partners that JV that you been up any more about to referral the certainly, several all the for question, as I highly

last we're nothing is ensuring that of making reporting been we we reaffirming new. And believe we placed or these emphasis of of X where inconsistent a about facts the on the most just that inaccurate. important been that provide, emphasizing referral understand has quality And in which understand that. media care consistent investments lot some compliance, the safety, really and sources our over We're so the we've the quality years,

my recent down would as cited -- sources we points partners. I I referral so seem release the there's straight kind resonating. we that in key JV from quality.acadihealthcare.com, prepared well with remarks, key points through say present -- our X when as that website, that's the that's with sit to record setting was the X we them and be that take in them of and that the the And

The first are and that decisions providers. how care for treatment whether is decisions, medical is patient including made licensed long are by that necessary

hospitals is in of second average that the is Acadia averages. stay The line at length national acute with

are and standards parties set And finally, and independent fourth a determination is it's meet is federal, to recognized discharging third that The that too are local on can governments. that highly in these within The think regulated catastrophic resonates evaluation. particularly we've to I and I those themselves the to consequences. And danger patients, feedback requires widely result by think policies referral and patient And community understand others, get. the continued or hospitalization state then required that it our the sources that medical initial that psychiatric third a hospitals based make this. early

the any in local within news media percentage little really facility tend of these we with a think correlated the level. that local concern, more any small to be rather broader coverage than have heard at national cases where market intense bit I

that I as with in to we literally JV having, think the And past only can. to our as on we conversations and right programs having conversations forward feel just on the right person partners. very experiencing that person greater been so something focused points do But we're we're intentional daily trying even remarks, partners. We're this, prepared said meet these opportunity any be we're on about just as the when is sources would we've And well referral basis. have we've us month. we the I's based a And with confident referral that have in touch say, over the place to getting going for in that in these

So I hope that helps.

Brian Tanquilut

volume then million is you million. that like EBITDA And impact helps. on the $XX Heather, in That your to mentioned remarks $XX maybe, prepared

I think the $XX by million. you cut midpoint

pull how persists curious capacity can like? if the this how So just into the a look does should be volume thinking levers what's staffing we that what Like then easy there? you weakness bridge perspective, or from or about And XXXX? that

Heather Dixon

Yes. take those in I'll turn.

sort first, maybe on revision guidance. give to the more to of a clarity just So little

driver that from exit expected we expecting around so QX of of X%, again, certainly largest further. Whenever And significant we have correct into basis that we trend we You October, accelerated even exited that the continue first as would decision, or -- are reiterate day growth to volume our was the the was a we to XXX patient numbers made that points those just September And as were we saw. which XXX expectations. same-store we we to we over on looking year exited the at when are expected. as the of the half a originally, X%, acceleration we drop over course,

prepared about of our that, that a was have is million couple projects. a There it would were $X there. million drove what of just remarks, year. What revenue the to quarter. regards your a from throughout what second was is million construction on the little bit mentioned the did and things of was in volume that that's top EBITDA on leverage, was of balance part those impact closing there about we I discussion cadence hurricane, to of coming in I of mentioned moving during the $XX we So that $XX impact $XX say as prepared that to couple $XX $XX beds to of to satellite drove And then that to to million we that the in million million, mentioned million some million. the about for although the the EBITDA down of related some that. Maybe of to guide dollars, question $XX in the reduction had or the just other remarks facility that the related related by But really

you any mentioned, revisions would is structure, our longer-term look of do we not expect there the were those patients higher back time. because to make So some ready more we have revenue the cost a significant for proportionately that normally this we on us. And we as would at to But a see area cost welcome temporary, this EBITDA impact those from changes on to where structure. certainly to we the made than feel and remain if to appropriate that's become is to what impact,

I be, lever would the really call we to sustained would would biggest on that downturn. So a on that focus say,

Operator

will from come And question next our John Raymond with Ransom James.

John Ransom

going timing this effect? get say, Just you where do how to X% have this. flurry this may of initial referral think to much of the long management trying seems work we are of you more would just a you giving to kind then And okay, like to referrals. do back of yourself sense to you have X%, carry how I'm issue, lost on just our permanent a

Christopher Hunter

put But I sense. just difficult of these that. a to continue just work I say, something I every we always on makes that normal are makes certainly is that speculate referral the just not to dial points, frequently. on really where this I John, tried It's touch our up we've say We've would it it more started And we mean, regular with month. to think this regularly, consistently. having single to continued that on time where sources been working to of been Yes, parameter very for day. us even all regularly. We've course, timing just as and of could this course, in that sense just partners meet course, person, This will I talking on referral But we're now. in right would hasn't something continue. has of

John Ransom

took I interesting. and the late mean felt. this it's article was August Well, a to be original for then it effect month

lag you it. was a So a was lag, saw there I XX-day before I there mean guess right?

a know I was, air you've had I VA of question other bit the pocket. an The was before said

also referral you? that they XXX, down any from given particular that looking was there Has been XXX bps. additional at are that maybe source So pressure

Christopher Hunter

your that answer No. on I to mean we out question. call would the VA nothing

Heather Dixon

how a -- mentioned, just for I remind know first did as course. here. the think not like think reduction go-forward we and days the of just should reduction, QX But you you that, us it's of run EBITDA, think John, for looks it's that sort revenue for question what that related your is about do reminding maybe that rate guidance I'll jump just to early about that because duration relative into we basis. part about Chris to and we you what talk of that it's go-forward the early too think on

Operator

question with next come Bank Dudjuk our America. from of will Joanna And

Unknown Analyst

Porter This staff the question that And to scrutiny Christian wondering with impact facilities? is are was hiring or follow-up. you find for you or people have to your facing, My guys legal to one ability I first have just retention Joanna. then on any just seen your

Christopher Hunter

call question. Yes. would the Thanks material say, overall, for I that out. would nothing I

lean safety staff excellent that have. We EMRs, that is facilities we we're as key capacity, said in as made, that to in factor really patient not do only attract I build monitoring, heavily devices the continues to to in our staff but existing as the new facilities, a Obviously, also think new a these in company investments remote continuing to remarks. prepared retain well us the technology, these resonate talent extensive on we've that with employees. patient we fill

and really yet ability have another done also retain think attract into we our which those take engagement well. survey, just We results, and we employee to as factor

that transparent and just available certainly overall, that up. We're periodically I our would say, I So our and be would trying questions else nothing with course. to do continue leadership We're very on for add it's normal to staff, that. we'll come communicative But and front.

Unknown Analyst

were technology, initiatives? these from you make All wondering just quality its yes. measure right. question best. then protocols results have So guys sure implementing people, that are mentioned training at clinical follow-up We you your my And and is was, to guys how that do you

Christopher Hunter

have with something years put that the we Yes. is in that X this place. quality invested would over in mean, to I respect now we I for say, protocols

place been implemented our facilities several monthly And a advancements we're to. made in but Chief a phenomenal a of last things. And a Quality our cited, or literally patient we've just we've entirely talking holding operators we're way observations, metrics the again, holding isn't really we coming map of place quality at I experience, has we're about to in accountable putting experience, done this and review, for operating in that would they've all not our that, intentional a heat tracking -- that providing that not -- patient new our years, also where as on not It's the the that review, and fact Officer use place. We've these anything just staff put for and put look in all-in-one about front it's So that the the say training also are putting dashboards routinely, we're incidents in patient quality for accountable that facilities in on all safety, I quality an new. front. one as we've just specifically thing. this place monitoring monthly job we EMR

the our the of implemented at facilities their [indiscernible], AMP we've Joint that acute year. think by is thing the up-to-date reflects conditions will assurance is also modernize produced improvement that tactics. and quality all final middle would I maybe out standards in point Commission past CMS that's all that I the software this program Joint And of performance cloud-based a this and of our Commission's solution the all

teams operational auditing, as our practices that they're having place, coincide So the they're monitoring as on participation. the that CMS that standards that commission with all well software joint and ensures conditions that are this clinical in educating

continue to able proactively in overall, modernizes to hold a preparedness It us our for and really the our just serve accreditation accountable looking mobilize operators to puts And approach portfolio. we're resource spots position readiness. troubled So where proactively by just we're for manifest quality the across the just it's because here year, we're of implemented and have by to literally for the cultural And This standards. enhance the company. we very encouraged will days middle the early software but change.

Operator

question Markets. And RBC come will Capital our from Ben with Hendrix next

Benjamin Hendrix

volume sounds about trends is wondering to the other segments like and softness I just to talk if well? you're you most any as as referral or It the related seeing volume overall degree that of RTC what Or see wanted in could related. pressure was not? I acute across well October. then

Heather Dixon

take specific We business look of pressure, any area the What that. trends trends. a -- say lot here Yes. would X course, I'll for Thanks I we that volume or looking Chris of very mentioned, deep have done the into for at as not that, we a line. there's question. or in outlier as is diving

from saw sort month. right started same of As focus. perspective, we some month, mentioned, focus the throughout impact impact saw Media of of where media relatively we've sort National had of what have as the then month, more consistently the the the as preponderance the opposed do we you volume consistent seen a a But beginning a it we it at broadly, to more and see relatively local facilities I little that throughout level mentioned, at

and pretty but month, perspective, always there's it through course, say the specialty. was business across saw normal Both relatively you Of same go those line fluctuations I'd relatively the consistent really speaking, impact. consistent, as of acute there. From a

typical Specifically, question total are a operating our normal year, here were I the normal would care with very RTC number at month, or sadly, facilities to native available say on there, that outweighs course, the your RTCs and beds adolescents board. And far typically what the fluctuation of in of but across is about capacity there RTCs, in the variation. near throughout

a of view things, into and what across of specialty. So acute consistent pretty that's saw sort we it's where and looked but we

Benjamin Hendrix

that. Appreciate

looks and follow-up, maybe question of per from bit It a X.X%. patient day, the lower as little Just like kind same revenue slowed on the that quarter a than had typical trends on you expected.

you various any falls wanted see of the offer that kind segments and there? Just can how observations across to

Heather Dixon

question. Good Sure. Yes.

sorry, for Sorry, So correct in fourth myself. I'm quarter,

that. through saw of you had would CTC the been So coming last very we what quarter significantly. growing recall, third a quarter, portion year, have each strong sort year impacted And to if CTC contributed that for by

X.X% have it CTC growth. If you QX, exclude the per impact of would day from patient been revenue

your answers a hopefully So look to that question. probably good that's and way at

Operator

Peter will Bank. Deutsche question come with next Chickering our And from

Pito Chickering

versus Looking acute, thinking of the than on have any police, schools seen you at ERs or impacted courts sources referral Just versus others? channel more about those the referrals self-referrals?

Christopher Hunter

Yes, we out. there would aren't call I any that

there referral listed the we we've outset, always of EDs thousands enforcement. I say would you've again, have the the them. I are a I area focus, Sorry, mean an are community-based so at we're picking up literally echo. are many as sources. an said hospitals number of but shelters, of mean, law and

I we are that wouldn't there any would say specifically out. that So call

We of touch even points. the out continue more all and to about intentional increasing reaching them be frequency to of

Pito Chickering

sort just about specialty any versus that like Okay. Is a was versus -- there more within And a consumer-driven impact it more specialty, looking we within at medical recovery? was of to business any then others should of specific how think division of think that the referral? others the

Heather Dixon

to wouldn't either. I out call really say Yes. there any

Operator

Andrew come And from Mok question next will our with Barclays.

Andrew Mok

the In department struggling then follow to that secondly, or notion department it referral I'm referral volume or areas to reconcile decision this the where are sticky. referrals. is pressure, individuals a temporary decisions at you is tend level I autonomously? And the organization on that just within making fact wanted to seeing the is made sources up typically be still select the with headwind the

So the seen to what's fill into push have of you pack And these any behind referrals? lost signs new volumes? early there a outlook. to door want not, understand evidence to Just if referrals the or is temporary open recovering

Christopher Hunter

are been I individuals. there have the decisions say Andrew. place, putting concerns would say that this instances would like answer I specifically, game, in these to Yes. made been there your There is have are continue some front we've that care and And of questions have that we would overall, track. the first to where those are Thanks, move many and I just execute been also place to a leaders say, that get by get to back really question, that situations to raised, of able to in been referral can think that. meet approach on been ground to certainly, directly. And situation, and is improve the we and patterns a to referral answer and health strategies source. But instances, that the where putting on in it's harder we're ground on in have referral lot have we mobilized I local,

Operator

James And Fitzgerald. next Sarah with come from Cantor our question will

Sarah James

of you're to that Is some on on a that face after It the move that where dip your trend sounds read you clarification referral you One the proof the meeting? have meeting. that, after positive in last seen had concept pattern right a saying meeting have impact response. is like way seen cases, actual

Christopher Hunter

mean these sources. Yes, That the time. dialed course, just love isn't all front of try you I last that of or so overall, been is function referral that can. to. possible they that in just literally care already expectation phone sure. of thousands partners daily to we our and we We'd are a a I've as of get months. of I doing our video. But local again, many with and to front in face-to-face over JV them many. to in happening opposed the few as the and health personally preferred of That's them again, happen. the course doing of in interactions all always call remind way the make we so would, have being the as think local, have But these front think referral possible that asked are where to just market operators we'll I in get normal that sources continue I up just frequently

helpful. that's hope I So

Sarah James

idea an Or Got give throughout ramp XQ? you it the the And normal seasonality of can it. watermark? does October the through high Great. Is year? then patient-based usually us

Heather Dixon

for question. that's a great quarter, Yes, fourth

over bring October specifically through someone have strongest month correct. of see that quarter. speaking, quarter to home period, normally that very seasonality or so. the occur to during related we the alternative the patterns holiday fourth end an that November families are You throughout out normal is will that are an option December. Typically The the holidays and do of

And we see in so volumes, typically that our we factor and in. that impact

that, the is expect directly. We October month. yes, strongest

Operator

question will Baird. Gillmor And our Matthew here next with come from

Matthew Gillmor

one. and I'll actually it keep keep KeyBanc. It's -- to Thanks. just

wage provide think the could trending that's was had color been trending just that Chris hoping how you terms was I turnover I favorably. or mentioned recent labor some of in inflation in months. and

Heather Dixon

jump Yes, sure. in. I'll I'll take that.

perspective, to end of was out. The trend seen have that for inflation the we at anticipate the have to that around up track we wage continue X%, continue favorably a -- X%. below where XXXX, year, play from seen said we to the was So of would and beginning that we it highest watermark

again, we've that in moderate And of to first range. X the that year, stay we significantly. And continue. then to throughout seen it So this months, have we held seen sub-X% for that has mention And expect sort steady. just would

Operator

Kumar here question next our Raj will And from come Stephens. with

Unknown Analyst

Fidel. remaining. I of those one Scott for cases and we X particularly Desert related had around being on just of earlier to kind X then settled that X the with get and around Raj Hills is tell This

the Just or to then contesting one that. actions of of on Acadia around forward externally versus on like And just kind settlements just those? going strategy any legal taken update of what and kind has internally counteract another kind

Christopher Hunter

continue we Hills, Thanks of start just question matters your view filings. But would Desert for that Yes. individual say comment material to question. and on we with cases. just litigation all can't will say, in our we as on and I the disclose I would have we

-- for bolstered disclosed Ellis, that our I we We outside our front. just with and to and And But broader just cases, publicly, respect in counsel closely. think have can that. have ongoing and very we're leave Kirkland investigations we legal limited very them hired I the team on just consulting the and with very say as investigations what and it's also we've it would at

Operator

Chris I'd concludes this And turn question-and-answer our like closing the back to any Hunter for session. remarks. over to conference

Christopher Hunter

meet and our facility XX,XXX effective closing, tirelessly needs want who leaders, employees In safe a to country, to continued have committed just approximately you. across patients again to in of I Thank the and thank the work dedicated manner. clinicians our

interest with us remain being patients them for together morning work to the in across incredibly Acadia. and for for Thank and your our all country doing excellence. important and this serving We you care with are committed compassion

Operator

for you presentation. attending Thank today's

lines. You now disconnect may your

Acadia Healthcare (ACHC) 31 Oct 242024 Q3 Earnings call transcript