UHS - Earnings call transcript Q3 2024 | Universal Health Services, Inc.

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Operator

Good day, and thank you for standing by. Welcome to the Third Quarter 2024 Universal Health Services' earnings conference call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Steve Filton, Executive Vice President and CFO. Please go ahead, sir.

Steve Filton

you. Thank welcome third of XXXX. quarter and results Health this the for ended to morning, Universal review Services' Good September XX,

the similar be expects, I'll projections conference such statements. During believes, as and using forward-looking anticipates, that words words and represent forecasts, estimates call,

statements, section Risk XXXX, not XX, forward-looking on XX-K ended to and statements December with and Risk in in familiar careful before ended our our for like Form highlight quarter year the call couple the anyone questions. trends the risks for and and and June to Factors recommend up XX-Q For inherent reading opening Factors the Form uncertainties the business XXXX. I'd these I of XX, the of forward-looking just a developments

our release, for the third As impact attributable of press net income diluted night, adjusting UHS the with on reflected $X.XX for was release After recorded the items the press last to XXXX. September company diluted the per to per $X.XX the share net of XX, as of discussed for share quarter quarter supplemental in included income UHS ended attributable the our XXXX. schedule, adjusted

acute the Adjusted acute have somewhat have volumes begun to X.X% year-over-year the gradually increased hospitals slowing. resemble anticipated, moderated admissions growth we patterns As before care experienced our we and pandemic. to surgical with

controlled. X.X%, impact our of Meanwhile, the were a excluding Overall, revenue was well solid still growth insurance subsidiary. expenses

acute $XX XX% program in These same-facility incremental XXXX XXXX, XX, quarter. which XX% during full of earned included during prior our compared impact supplemental Medicaid net quarter quarter various our the the year programs, in of when for step in results the premium supplemental projections the third further last stabilized quarter from the care XXXX year the X.X% Medicaid amount in increase our with headwind the reimbursements the aggregate EBITDA our Nevada quarter of of to XXXX, towards increase to physician of incremental for of more recorded in significant third was comparable of approximately $XX net is was in we as XXXX. during supplemental excluding year's the earned basis, year the a where hospitals. July third in reflecting payments quarter, acute XXXX. On thus a revised by income In as acute The approximately pay of were connection third in a earnings Included quarter hospitals margin XX% the our decline for expense, state XXXX. operating in increased half periods. third Specifically, comparison and was at million, the hope million has to several prior extended guidance excess revenues a was reimbursements recovery our segment, sustain the hospitals next at which care far approximately acute of on of a operating

same XX.X%, the an increased adjusted patient behavioral by facility revenues in hospitals X.X% revenue our quarter, at third primarily by day. health During increase per driven

revenues supplemental of prior Medicaid compared to as not our EBITDA XXXX for facility in and included adjusting comparable X.X% X.X% period. Even quarter payments facility third in XXXX increased after year the the guidance, increased original same

professional increase XXXX, claims. for trends during unfavorable of As a a self-insured quarter last recorded third reserves result and we to of experienced liability our general the several million years, the during $XX

period of at XX% approximately of repurchased XXXX, million company's of shares. a cost during $XXX and the $X.X we from to same $XXX during generated operating in first as cash months the the Our expenditures activities capital our first XXXX, X approximately outstanding total the In we on spent shares million million. Since X.X $XXX of million XXXX. billion months of X XXXX, compared acquired was own have

Michigan, continue XXX-bed Nevada, de Alan which XX, XXX-bed As shortly, novo of Regional and Trinity expected D.C., and approval revolving Hospital spring supplemental our Vegas, in proposed Vista is acute Washington, well in of of opened processes hospitals, additional payment credit Beach Henderson new Construction open connection The Tennessee are the program XX-bed Gardens, Palm a Nevada. continues acute spring available open Center segment, as Medical is care in in had California, which XXXX, in In care facility. Health $X.X expected continue XXXX. to the in the Miller to Center of the the expected on the our in Health, venture Behavioral joint segment, XXX-bed consisting of Washington, we we Southridge capacity. Hospital with and our existing pursuant which Las open develop River is Behavioral open West increase as the to in our in billion Medical Hill in the care which to in billion XXXX Madera, with the $X.XX Cedar Hospital we XXX-bed Medicaid Florida, spring West capacity to the September D.C. funding to recently is XXXX. In programs and borrowing to inpatient health aggregate we ambulatory Michigan, expected behavioral B. developing

increase all net not approved which or Although timing if of approved be may XXXX, assurance $XX with in to And October the program until with Nevada approximately Tennessee effect of current cannot XXXX. The will $XX benefit CMS occur we these benefit with net provide $XX the million Washington annual XXXX. the with X, changes of annual by that estimated their forms, million program programs of million of of effective million X, funding ultimately program or the X, approvals, benefit annual such July would any estimated net estimated incremental and existing with effect approximately the $XX July D.C. be XXXX. to program the of

any pleased your benefit at these guidance earnings year July answer incremental the to of this not provided I'd XXXX estimated of revised time. related on be did XX, previously full the questions as Our for XXXX, programs. include net to

Operator

is line question first from come Research. the Our Instructions] Josh to going with of Raskin Nephron [Operator

Marco Criscuolo

to areas just question. behavior if you the behavioral during commercial activity actually plans wondering then managed I could activity the appreciate downgrades Marco and also you of is care the it was what acute quarter Two-Midnight? segments? or be plans taking around would trends This you MA some across is denials on be for any around speak any And in on give between color both may including helpful you whether just changes seeing Josh. and you're if patient seeing I could focused the specific like this and

Steve Filton

Sure.

other off of care and early XXXX think XXXX, late on coming 'XX, and I to think our you note, 'XX, So in to in degree the the large pandemic. aggressive, part back the years response clearly, we commentary the go if initial 'XX, from where more felt review I we decreases and of less especially the began during of think, become to in managed of payers, into behavior first of a the like stages our aggressive utilization some significant had pandemic transcripts I payers early

the patient when we I more a stay seen, payer to saw again, in as So current would relates we've cetera. the in as patients are quarter. late dramatic become aggressive 'XX, facility, of change or believe relates 'XX management early say denials, status it I to behavior it think, that et since then, length I changes, since don't

behavior wouldn't I change been that has I more X more quarters. But saw current or think, we've the again, a citing, dramatic like been that the suggest for quarter. year in aggressive we think, or ongoing X necessarily a

to Again, coding behavior and focused weather Two-Midnight is Two-Midnight rule. appropriate and and area using -- rule as been rule asked years. a on for the a As that using firm specifically admissions. Two-Midnight cetera. we've far the made any with We've on with code appeals, think appeals comment same several help the because et We've focused that to I we've help us you been rule consistent denial consistent been about with the the us properly particular third-party firm Two-Midnight

in handled Two-Midnight again, claims the of claims some with significant of Two-Midnight that as peers I rule rule. our a CMS terms behavior maybe And their our the we've issued recent result clarifications -- as some really think don't seen, coding changed perhaps being so have in are Two-Midnight difference of how of

Marco Criscuolo

And I squeeze especially seeing as to on recruitment opening update all the X incremental was I the turnover physician more and any wondering one. behavioral additional on quick then you're just then a area? if in more quick trends in segments, competition appreciate that color just give it whether that. to and up capacity in could you relates acute

Steve Filton

Yes.

emergency the room So was expense case, as hospital-based physicians, and a and when almost physicians anesthesiologists. all our especially in about there's of last providers increase for significant I hospital-based been discussion related in there year to think physicians much physicians especially

think put on more specifically patients. that that changes, specialties think result billing of to was their that, out-of-network bill billing I the, I Surprise No and ability act a in increased expense anesthesiology for the and room terms constraints of emergency those

last physicians than I physicians. the a by glut difficult it's I do would lack over period. is But cetera. don't a don't don't think more of in in sort expenses were physician those particularly nor So I current I every changes specialties necessarily years. recruitment the of several were think pressures much they scarcity we think different there billing et as or driven think on those by dearth more of those challenging, market, a there's the a think describe that I are changed of

Operator

line from going question with to come next Hynes the Ann Our of is Mizuho.

Ann Hynes

And getting there in on incremental Heading tailwinds maybe there anything to and out? Is like XXXX? I call for provider that, into lookout sounds XXXX, be are should it we you know major stuff you're the headwinds any XXXX. want to

Steve Filton

we'll Las Yes, in believe a and then us, the in believe both I And will XXXX, facility that late hospital -- be prepared which of create our should the don't some detailed those more precise X in as drag. so are and my There this which well think of February. District this ramp will I don't up, facilities but significant on create drag a about again, facilities Vegas, not remarks, be guidance opening either I Columbia, of West mentioned spring. give EBITDA. year. so in Henderson they we think But much our that, in open expenses Ann, new some open a when we'll I XXXX I will for open positioned have will in

expanded otherwise, are Nevada. remarks, X again, either for recovery comments. And are opening of new programs approval. or for the of think in specific think, the the have some year, ones been earlier mentioned either submitted continued in been businesses, CMS additional be but the sort California and again tailwinds reporting in stages programs, major or I There's to Florida finally, I in supplemental my Colombia, of my then to have of I that about the programs alluded those, next These things expecting terms been some District we development. effective Tennessee, margin in that, and that new are written could that that I are ones

some some those area, seem I some disclosed at So are broadly, the in I think takes of as XXXX little big tailwinds be others, at supplemental are or which But significant which quite puts think we've point. there and not point. this for to a bit the to Medicaid me potential more precise detail, this in

Operator

the question to from with next of Our Barclays. line going Mok Andrew come is

Andrew Mok

now on the focus more And comment growth? segment acute that on for like just a that volumes, if in volume what's outlook care take I Maybe volume baseline progression in volumes. the back a for and normal wanted established we've to the step business. you the acute

Steve Filton

and expected I some and Andrew, think time regard, for this to is in clear been we return our broadly in sort I'll them, consistent that we've of pre-COVID we've acute normal, more pretty call growth care been levels. that saying commentary to

that evenly growth would to pretty price volume. between So the X% same-store and revenue range, X% split in be

you think think if metrics year-to-date actually care, up admissions at are I our in X%. I adjusted look our acute

think I up revenue or our pricing X%. is per adjusted admission per --

price split growth the Nevada X% Medicaid you're in think evenly of for that volume. between of if range and to adjust X% you sort pretty that revenue supplemental, I

the care a I elevated that acute future. our have structural look while. that's volume have that volume I growth that know some in may the a been foreseeable been view suggesting the think bit for from there changes acute in our more and care little of commentary what would result for like bullish been peers business some about

I care just obviously, benefit yet. of And are We haven't there from would that structural seen really as these yet. we think them hospital. just the would that haven't average if We seen changes, evidence acute

number a change are significant kind is I they cetera. I to which anticipating from issue, of consequent the other rule things, earlier, fairly and et coding acute a Two-Midnight care the in of these a change think are The way alluded hospitals benefit

As we and clearly I've been anticipate a And now, several now. necessarily from indicated we've focused pretty that as that. don't while again, think I issue for consistently think years an benefit for a on incremental consequence,

we're the were last deferred largely point. think And future and the several procedures cetera, that the I sort something the growth in acute some catch-up deferred we again, of years view think a et acute but and thing, during definition, past So care acute of or that the have growth that pandemic. of and I onetime broadly, has is be been solid, think this of volume revenue we've should at been care or care a postponed care and result seen I those that volume growth acute by volumes really I procedures elevated postponed think over that

Andrew Mok

then in Can the than help onetime there understand And a segment? us expenses or corporate the our quarter. your items any of corporate the Great. higher bit tracked increase in other you drivers estimates

Steve Filton

smaller our probably had of We on miscellaneous debt we related to $X million the $X We the had Yes. did refinancing another million during settlements a quarter. that loss extinguishment of lawsuits.

that in nonrecurring I of quarter. corporate as the clearly So would $XX million characterize expense,

Operator

come question And Wolfe going is from to Lake line of next Justin Research. our the with

Dillon Nissan

Justin. This is Dillon for on

second, the of do quick the pricing Just And any expect in clearly similar then you. you expecting can heading in a opportunities strength. there the on provide color remains moderate? Or Are Is had you behavioral a of that quarter? business to into to see couple for XXXX? ones behavioral trajectory volumes you

Steve Filton

able Carolina again, we day we view exit be of in to of for bit originally to, and several that XXXX, of same-store level, of behavioral to originally X% facilities able the exit third from revised last of that and year impact year sort that quarter, despite So I we Hurricane a the South occurring about that the more as to hurricane of very some for were Georgia that's our volumes, was far for been think anticipated, as patient the little end We we'd drag that at the quarter at at the X% level. Helene. on we've the talking and our guided than the quarters, behavioral trajectory while of growth growth sense full X% slowly sort

remain to So day yes, that exit fourth remain so. at should I confident we at do think the that that be X% quarter able we least confident can patient growth rate and we

to to that. be likely where as efforts is from people at anything we're fair, robustly has the and years very of staying some try far pricing. as pricing to lower-paying As some point, continue for And Behavioral strongly in -- that behavioral our leverage some quite not But time. current to obviously, attribute pandemic. We to to know, strong is better moderate now throughout degree and to we believe in foreseeable that and our at reduce been most to large, do of very pricing, there several been I which doing the some great it payers, sort for future. the particularly been for think point, that has will environment there's should running at X% deal of at that. X% excess managed time some that's we of believe behavioral And sort in an strategy. pricing But capacity in historically moderate been that track not We've of at payers. range an behavioral industry effective Medicaid suggesting high but behavioral still a levels the pricing

Operator

Cantor. the Sarah question with James next is to going of from line Our come

Gabrielle Ingoglia

This Sarah. is on Gabie for

you per through admission. us there? Could drivers nice beat walk just that any day on a had was And the the extra acute to of related in quarter? revenue You the

Steve Filton

look thing, the Yes. out the I if we think in to I wash. in I of that year, full not the you the at extra a comes period, really the largely end, is because longer focus mean, all day, tend that think on the mechanical sort obviously,

I had we a comparison. acute care think importantly, difficult more

to I I attribute were or even our our if in think But back year's you to and admissions go you last that read commentary -- only more procedures from procedures the close during and again, postponed our to think same-store that up the listen and lot pandemic. X%. postponed a last this year's deferred deferred third quarter third catch-up adjusted have importantly, quarter, of or we in those been

defer of And kind volumes were as pandemic. last to a quarter more had in consequence, while back if tended towards the you discretionary the those surgical lower they year, acuity our procedures to ability be third both admissions volumes, of during that skewed and people go the strong

so And of lower down was and they acuity, sort but come of to to 'XX much looking of year's 'XX, because come revenue at look procedures. up last that comparison so of you quarter volumes activity the when see that now you're acuities have unfavorable sorts some, due lower

Gabrielle Ingoglia

Okay. the And then color Awesome. inpatient surgical trend? any on

Steve Filton

Yes.

in slightly I were lower the describe quarter As of more they I'll surgeries prepared sort third of soft more procedures. last were elective and sorts catch-up that a And dynamic discretionary, probably lot it's of strong that skewed my in what year, same down quarter. think quite but towards the acuity, remarks, of as surgeries lot I were again, of a the in was noted

Operator

going is the come of A. J. to Rice Our next question UBS. from line with

Albert Rice

ask to the labor. about just Maybe

more of think you there's in both opportunities? commented you down at stable a on in a at Or we going You can point and your XX% sort hold premium pay lines SWB comments sort still Any of as percent ratios of to do this if seeing point forward? your of revenues further $XX you're broad million, use was that business year-to-year. what down Are labor?

Steve Filton

revenue asked of of particularly I've that increase percentage from emerging the as our again, the which in is premium of very at of our of obviously, benefiting saw I kind think has and a to environment use the of quite hurricane is contributing where a It of out to the will did Obviously, has facilities, It's of dramatically, we're to we an QX. And has to And sequentially say that's the end and probably it a QX are pay whether about think, now not, I trend. margin businesses the that's sort impact of of number function post-pandemic the in I was Yes. the quarter would behavioral at somewhat think, sort What volumes, that the this wage think volumes double although business that I salaries That's where lower that revenue stabilized stabilized. Georgia, paying it on think Carolina but whammy et we're happened, that, and us diminished salaries also, but South outside A. have segments. would in I of and in flatten I markets, it's trends noted staffed. inflation, been the should I saw properly robust. substantially I both recovery labor stabilize both in it's also stable I we keep also have in that, starting because is than continue. diminished clearly J., people pandemic. that, think people in the height has environment a sure side, say overtime, that see cetera, facility to say growth me But diminished an make

Albert Rice

that, is there's buybacks flow think side, beyond should there pipeline, your capital thinking you of stock development about to cash is the the Or cash pace to new And to whether most growth, on bed the to go JV obviously, going think just opportunities? we flow maybe of And M&A 'XX? that then Okay. additions comment cetera. from as et extent behavioral here? of deployment, any free start about the Any that

Steve Filton

would to mean to been beds about were those more talked we prior started and we there beds But in struggling continue had, in doing maybe of to we're but of aggressive consistently many add staff market the during that with the activities we've existing spends expenditure adding stabilized, that, some building has logic there to to a or point paused expansion I labor beds. remarks, the the the volumes pandemic, pretty the of sort robust -- say We've an big those my is we being, beds. restarted markets Yes. properly, again, increase capital prepared with no behavioral pretty program. I business. looking I opportunity in by our where was pandemic, new we now we've

low in Now to overall fair, be behavioral the our in XXs. occupancy is still

the facilities resurrecting are, So that. new having there those plenty facilities to upside are have but any new for programs that beds where or again, and continue should in are occupancies we'll beds, to of running there without than to higher are volume we some either entertaining at add do we potential build facilities, that. And

for I opportunities with think presented as regularly. we that far comment opportunities we reasonably As M&A, are often

great have at last those found, although we'll look if deal opportunities to of you our X, them. to years, X We continue at a compelling, very not look be

is this predict, capital guess, will X could And for my is our hard X think expenditures as to but on that share has so it -- I focused and been on be remain probably much guess the last deployment it, my as capital repurchase, because about years. M&A, think you to

Operator

Deutsche going the Chickering is question to line Bank. with from of Pito next Our come

Pito Chickering

a Looking procedures. for at days the of that's Monday neglected it here, because metric through fun busier same-store yes, occupancy probably Wednesday underestimates

sort a what hospital same-store fast expand max aggressive admission can't max your So my a is payers capacity in did question you conversations this if occupancy impacts beds for portfolio growth? of it with occupancy, as when enough, of few think ago before you And you behavioral? like create does low-yielding is, the years sort about the were you MA more

Steve Filton

Yes.

question specific your so if I'll both for sure to one of not segments both. answer was and or try the I'm Pito, So

at hospital walk become in metric. times you a somewhat my are on bed years inpatient of the sort room got measures or But beds. OR through the walk Obviously, relevant the your and but a there less in occupied you've number from over a think hallway at any been it and maybe that I you occupancy perspective, experience real that through is schedule X/X acute has of side, the cath stretchers the the busy occupancy inpatient lab, an emergency thing. I've

think as a of it was. as not acute in is it be of care measuring to hospital. a are, efficiency relevant of There that care in I inpatient think, other number equally output metric acute I onetime important So sort used of the occupancy the or variables an sort

I many capacity are, necessarily think that think in there don't the don't think programs in beds, to we capacity of we're cetera. know address that. any that responding too there inpatient terms in the improvement that hospitals I or but emergency in question, have et terms labs we not cath of of broader We're we're max certainly really at expansion capital areas. I terms of to with that ORs, we're and degree room that And or I those

behavioral fewer relevant. thing, bed where for I constraints those in think least have and bed we're places the facilities contemplating but that doing our And bed On mean, our at But visible number the behavioral account is expansions issue. sort certainly of that sorts or well. is an the for part, business, more needs or I although there same the as as outpatient There occupancy in that inpatient obviously, a of behavioral activity to inpatient measured be are think an side, I occupancy hospital are geographies ancillary where procedures do most that, capacity we don't expansions. I said,

Pito Chickering

much going of sort you for that follow-up about could have different on pretty being subsidies all like of a groups at expenses. pressure across physicians NICU past, Like then be or points been like at Are portfolio here there physician asking the revenue. is talked not in And stable? forward which which stable other areas and X.X% of radiology across Great.

Steve Filton

Yes.

et answer can where expense, I specialty for portfolio, the examples say, in subsidies So every I had we've is cetera. almost find greater would or requests yes. And the in increased

and areas. from in As been asked comments I think those XXXX but than every you of -- emergency which has was radiologists deal in think, headwind anesthesia I And day, for biggest while far we I such broadly, expansive the clearly think has less think and But or have I the issues the much yes, seen ER laborists noted room they the sort where pressure we pressure continue largely about. anesthesiology. as I one-off for a for us, stabilized. most pressure But by or situations my I earlier, with we've accounted hospitalists that in to situation, have, think

Operator

Our next of question Gajuk Securities. BofA the line going is to come from with Joanna

Joanna Gajuk

So clarify the psych first year. to into around I guess outlook business for the next commentary

So the you I X%, growing volume excluding of growth. supplementals to idea pricing you of expect maybe And sort alluded guess X%. exit still to at X%

growth So is trajectory next year the of to that that of segment? expect sort in terms for

Steve Filton

Yes.

then our any to that. next I year, X% precise going and think, how degree start obviously think we of et fourth but broadly to But X% on give in of But So quarter I cetera, guidance to February. have we're of XXXX our year. not significant Joanna, We precise I going pricing, sort would mean, until I guidance this thinking think next call. don't call that do trajectory described about of more behavioral of be mid- a incremental pricing growth X.X% that's same-store that single skewed to bit suggesting sort digits, of upper that's, business kind not the little X%, to that revenue I'm in terms X% in is sort be we for X%. volume in that X%, Medicaid programs, expected so there's the Probably growth supplemental the our to to to

Joanna Gajuk

of as recent but through there a you market? walk adding I volumes, still more more teeth seeing execute But Health so I so out can So with actually bill kind that to to year. in guess, are Parity And you what psych, of all guess expect to requiring also staying the in tailwinds, states you're sounds that this on Mental the I benefits. Health like has, and Right. us Mental X%, obviously, so guess wasn't on Parity think different the terms about exit of this close kind quarter very maybe we

able So I volume? are staff demand guess, I rates meet that guess you able something to be that you there higher said for demand, are and about is then to increased seeing to to be

Steve Filton

Yes.

our taken We've that a I Joanna, because hearing in of little I'll having I -- apologize question. I -- crux indicated as cited we challenges, your earlier than we we've labor has volume scarcity little about you, I'm think it's recovery comments, of a candid specific issues some trouble year very able been specific expected. longer had number or been has this, been commercial think in we've facilities they've the I say saying So of struggled but I geographies then unique that think I got products. handful sort issues pockets exchange bit that issues have I disenrollments and of impact created behavioral patients a in for over residential challenges that's about And the one. and from. who We in of been some with recovering of even think sort have that those to or talked been Medicaid so, the last enroll the a reenroll

While to side. that, think, be tends acute benefit a the I on

and think commercial copays been of fourth that recovery improvement sustain a and all most of behavioral behavioral challenging. I quarter about really being to in about the plans part, issues. the be volumes because for benefit in the it the is large side as come our I these deductibles the sort on optimism our able to the generally recovery that tends with But don't those think much of have

able and reenroll more able adequate continue and co-pays in staff continuing exchange allow continues us and to have are patients. to to get impact exhaust have to The dissipate disenrollment staff are either patients hire more more they commercial that be and the struggled facilities Medicaid residential to or Medicaid improve coverage their as to to take We deductibles.

the those it's think I contributing So behavioral that's areas improvement to the really in improvement.

you that. of ago, we're any think I implemented Biden parity. health which think Mental seeing that of the fanfare years asked great expectation significant about specifically from of or I sort administration's anticipating rules a and benefit parity, mental health number would sort benefit on really was whether from we a it's tightening of

intent I that payers change. them government regulations the actual think know really some think don't degree a benefited really I parity. are to has I and think, the but I do health getting in that of mental helpful, likely community create terms both the to with, strengthened comply and they're think I broadly spirit been payer we've of but landscape the to the challenging

helpful I to increase think government things, behavioral they're where and huge regard. appeal that's don't is these think But things, as we strengthened often sort that regulations in that in we of helpful going drive are appeal as volumes. I a denials

Joanna Gajuk

question guess, a costs million -- squeeze out or If guidance, a guess settlements, wasn't -- quarter guy, I I change no was last, you on the guy clarification I million, confirm guidance? no called there supplemental I comments your bad that so so the then I and in that guess, $XX guess, but so want there, to XXXX roughly $XX in for to XXXX and assume that may very these from that. good I I change just

Steve Filton

our to change no is revised there XXXX guidance. Yes,

Operator

with from Sachs. Our next Perse the line of come to Jamie question is going Goldman

Jamie Perse

Steve, saw but I want normalization, expecting a outs volumes appreciate at any go of quarter expected. not to been that like? than payer third think then And any of that? was give change call across new if you acute on classes to to representative X.X%. you've are normalization, dynamics class, larger Or if normal in that about the by detail there just grew us forward? quarter what any some in the payer go sense quarter you I the And get the make the can just care this this back to wanted as relative any is how of we some looks weaker

Steve Filton

Yes.

comments think repeat just one, I've already going I'm on to I that to made. this have Jamie, So

of if think think, and from to is really most back we onetime procedures, that thing. this consistently deferred I the or listen fact, people's dynamic year commentary tried and the during last sort pointed go of last expectations. of to I you which the the significant and importantly, in difficult quarter did postponed that a our last think I read will exhaustion and clearly and comparison is year, as quarter to we But to I was difficult have it say was more kind manage to which out year, view of sort comparison related the

mid-single X% start if thought per for is revenue X%, supplementals, to you out which evenly kind of between X% ex-ed performance What you or is that admission historical get I an year-to-date you same-store X% adjusted of was acute of care was Nevada model business, and get growth, our And the admission the pretty split looked but model, growth said the the revenue future, I earlier that volume. adjusted the also acute if expectations reflective at our -- growth. of in my digits, reflective you impact mind, also started price to a,

Jamie Perse

for think Okay. either period, longer-term in last a number so, administrative of particular, next strategy unique MA utilization, And ASC over burden, us guess X That's years payer environment HCS. and then maybe as a growth that you I a on that question. investment structural intensified tactics of in helpful. the emerged level in been and internal about a bit the aggressive have impacts or you We've set forward? X probably really pretty priorities just can maybe dynamics going or just years,

Steve Filton

mentioned. I time sort it's could that mean, pretty period speak sure that question about dynamics and all we extended broad a for the of an of you one Yes. I'm

of been I and we which surgery facilities the an care ASCs, question, a freestanding component it. of an We've we think et can view has access in of investment to patients again, our as freestanding has participate cost-effective departments and -- ambulatory imaging expanded great that emergency broadly, resulted penetration example. points. whether ensure imaging, greater the most had freestanding That's I But that cetera. much continuum a would that settings which way care the have are clearly in is, acute broadly, to the to treated in answer growth seems looking be be centered question payers the care, that success EDs, are in and freestanding of continuum, one I certainly think facilities trying broader with in it's,

is The through organizations. whether other, our a physicians, accountable with continued think, care I that's alignment

by all every cetera. we those that we of et virtually going into which is physicians think in being pretty We have as government, where sort be think our continue of properly with single and dynamic. we our a payers market have at we is and Whether markets, environment aligned important utilization employed view carefully it's we viewed sort I by challenging least But operate. in the which one to of of physicians, in most

ways continued cite I of the care think of to continuum those alignment emphasis X next focuses expansion continued and of in a the physician about the issues, me, the on years. X bunch major different we So our would as as X

Operator

from Langston going the Ryan come Cowen. with next of to Our line question TD is

Ryan Langston

Quick then broad maybe more one and one. a

SDP program D.C., the benefit out that you for include First, facility that you're does does the opening? new called

Steve Filton

does. it Yes,

predict we cetera. part, Although of the on for think I most the obviously, the been impact what because, it's difficult track new et no facility record utilization, to have is

a Medicaid So would the new the is well program will from of any performance this based that on district have approved. smaller new the in behavioral But do in number hospital that's hospital acute we've participate largely have supplemental in that as program. as the care benefit historic given hospital district the a our we

Ryan Langston

guess, potentially you've just would that ranged I already, upside be to So what modest? maybe some

Steve Filton

Correct. Correct.

Ryan Langston

more and frequency seen legal in headlines acute maybe then on the we've behavioral both guess, Okay. just in broadly, side. increase And I some,

X your of And subside, it much is just I you're So you that if at curious frequency just on like the avalanche now CX going these your than least of that seems are sort pre-COVID. mean, just thoughts think higher and more? to on might get

flow So be some of on high-level the thoughts great. kind legal just news any of would

Steve Filton

the last have Yes. been particularly of kind some verdicts think and mean, in the behavioral -- there year. grabbing I I headline certainly, in space in

have we that I At to But verdicts substantially more been as a level. X we the the reduced indicated, there's activity on subject believe great both verdicts we've issues. that think cases. to appeal those are judge both of the disclosed just at appealable go has deal X think least trial I again, of

think reflect hard say change I in really cases a the those significant it's landscape. to whether

terms of sort jurisdictions or history facts whatever. I any were think of or the of extraordinary they the verdicts in of terms both in case

extraordinary and been necessarily in think the and are significantly just prepared our my in increasing frequency really reserves the that by but of disclosing we've malpractice I broadly of verdicts, are cetera, to likely settlements severity the I we are both because driven and in et more of to of cases severity cases not an so not I reduced. the cases, but those do mentioned expense As for X in recognize, remarks, increase, think, be much sort

Operator

Gillmor Our with next Matthew the question KBCM. of to from is come going line

Matthew Gillmor

Tennessee Steve, you heard so past. the Medicaid for supplemental the outlook about in the we've and think talk payments, D.C. I

be and sort additional of think new Or that's mentioned previously? I developed? you understood today, that $XX for understood million. some already Nevada funding be in was to Should of something baked that

Steve Filton

No, their supplemental to result utilization, I a is think their benefit and the submitting size of the what gives updating rise pool of Medicaid incremental data as CMS. statistics that Medicaid state to and that increasing

is it And I -- consequence triggered increasing state Medicaid is disclosing Medicaid think that and we're supplemental as the these is the that something now. pool in sort increase by is of that So was But their available. newsworthy us payments it's obviously, of incrementally experiencing. to utilization a

Matthew Gillmor

I then, provide comments the And to Got see if Steve, be it. would wanted able dynamics. you on hurricane to any

the that small I matter is much? edges way think Or think EBITDA about volumes. you it that mentioned behavioral with of any to just doesn't any But some around impacts sort impact? it enough

Steve Filton

think mean higher mentioned side points a a of the I it the of basis XX, result. would up business, bit impacts quarter XX hurricane. as maybe not patient a had been I the Yes. that would thought say have we that behavioral in of salary was been that the I creep probably there I the expense for day volume during on

a the impact out we quarter. It a the both item. to in the broadly, think a I was to enough it enough drag But I of significant a discrete material view bit was item. call was just quantify discrete our had certainly segments, wasn't point of out during as of the the not think that trying as hurricane view call of of sort to it

Operator

Partners. with come to Whit going is question of the from line next Our Mayo Leerink

Benjamin Mayo

EMR efficiencies? I'll making it of an segment. or within you we many now, other to X on some that been just Steve, be we any benefits question. enter as have investments the facilities just was on that looking just the strategic update keep any I then for guys seeing new How of mindful should And maybe that labor initiatives XXXX? within you're segment behavioral

Steve Filton

Yes.

EMR on think So the will early I XX probably or next continue. by in the XX have that me I but facilities year, Whit, precise live front installation and data and necessarily we'll process don't of implementation have

feel of care, when to to greater a have it's think cetera, generally record different successful. tends easily, also itself more that et the necessarily don't the view but can And record are think I you quality and we able quality improves, paper clinicians efficiencies it lend higher you of think that care been I like patient that to I the provide.

a or behavioral patient And part is to that with, eyes think that's been watch date, patient minutes an what we I on having able about on and more every describe exercise around know way. before we've patients where talked tablet to safe that Apple as But very do patients a has to the physical carry, and whether someone or looks technological very, are that and so. what patients process what to degree our can every other eyes laying well. literally keeping patient frequently. It's development behavioral observation of in we like clinicians significant been a they've tracking where that keep effectively and that the like enhance technologically, XX a have observed patient have be looks and them rounding,

the and in that that's in quality going patient management, business development significant ways risk few behavioral years. great in help many care of the cetera, a et of will think terms next to be in I

Operator

to from is Baird. Our the of Ha going Michael next come with question line

Hua Ha

of expansion even pre-pandemic acute to in business aim care your when a Steve, last and being continue in moderate. lot sort basically, you had mentioned I eventual And the EBITDA things for of able management that cost to volumes. preparation margin return think quarter, of then

feels it that acuity be now than picking appear volumes and expected. it moderating be up, most might seems to like So to faster materializing be

point has EBITDA position how right Q? to And what's revisit drive I at ask about that volumes wanted to tracking? the this in been cost now you're your to confidence level management and So in the expansion that right moderate, time, it those this continue margin do topic if in efforts,

Steve Filton

tackling think the We during efficiency. consider sort I during traditional I paused maybe of was the workforce and if suspended of peak adequate temporarily be workforce the that of was, were were kind pandemic. we would Yes. the quarters is so a to what may that definitely we last there sort blocking mean and of the idea finding keeping this an challenged pandemic. not quarter, in an adequate reluctance manage of -- make productivity tried last a There to to I point in and in some have couple of the that done standpoint sort from

been really down down coming I sort I that moved from always saw think think as and margin steadily, is contributors as of things done, a of to we've willing as I down. And up coming where has adjusting recovery. revenues and and quarter pretty of this volumes last to think main that those salaries historically I as and you I we they do think you well, pandemic, that saw to that including one quarter percentage we're emerge think the the

being, and I where the anybody an than a at don't we efficient think so I and much care And when faced to don't certain. volumes about in more But for continuing. we're that acute move, of height knows way exactly that's will challenges. I think think know reacting were that think to pandemic, really many where I I we the reacting point we're the position more staffing flexible in

Hua Ha

those sizing. $XX hearing recent payments if not across payments proposals, to around has million which states, it million all those state just New And if the raising a with supplemental on, additional about I I through California year. Mexico, real guess, CMS then I discussion was your everyone how and Florida, the and then wondering follow-up. Mexico was is clarity we're for potential you next all tailwind, California of to could for sort on UHS. And of been for potentially and more the wondering but New this? proposals focused tailwind for have million average 'XX, California, $XX commercial $XX talk any potential a you be could rates

Steve Filton

Yes.

asked, specific So just responding significant to upside a questions the Mexico, don't is us. for I New you think

have facility the et both in think an we a terms obviously much a of for New sizing I or in potential presence that formal behavioral. created in plan small one has not is challenge state And California, acute behavioral benefit bigger have the the cetera. and allocation California We Mexico. methodology,

until that that understand could in potential specific least next among the of allocated significant, which we we would state understand, way impact though we is no plan, would quite year, really more it specific hospitals even happen be hospitals, not benefit issues to at knowing be how sometime total how So next until a exactly the specific maybe year. likely early or have

other CMS aware states average to more Your this their or submitted in cetera. varies of to broader only that stages, have earlier commercial when approval. they've formal et and states disclose are we've funding them a really are But likely of by programs, practice waiting their plan new sort that and like are certainly, we contemplating the this question increase others states about state develop to programs rates? really had It are increase

ones we which to we've themselves. states submit in opportunity beyond develop sort until any in be the them so believe that way potential and their But to of significant continue difficult and disclosed, to are just And that the precise size that could I think, the significant, CMS. plans benefit of

Operator

the Capital Hendrix going of come Ben line Markets. RBC next from is question Our to with

Benjamin Hendrix

heightened and Just psychiatric on thoughts there? and strategic just there security, be Is any we potentially direction mentioned could this amid opportunities especially very on but psych. of a this higher your issues changing I some or residential? I residential in or on some consolidation of evolving the in get to initiatives questions, before, thoughts liability think strategic the facilities. I've updated strategy asked any updates wanted reserves around quick your specific you of could follow-up psych, any some at And there know kind

Steve Filton

Yes. and on my focus on -- my in I asked answer mean, well, acute think some I I behavioral a was the earlier, question care. kind ways, strategic that was similar more that But then of outlook be the footprint is expanding to our role greater likely sense demand there expanding see care outpatient in more to and in continuum we're a for and an is play we access which care, will that. in to outpatient outpatient response

a I think seems to addiction because is increasing services or we're we And and business continue the continues our The to be growing members of there. increasing military the and to there. part expand business. SUD think I our that grow demand significant to exposure

of add other I to paying an know we or residential telehealth sort issue particularly would dynamic sort more other of that growing. attention of the yes, these is So I outpatient on lines, which think as don't focusing the it's acute as than of And are continuing well. one much capabilities service it as expansion

Operator

And no showing further like Steve for conference Filton I'm would time. to back this any questions the to at And I remarks. hand closing over

Steve Filton

everybody Thank the next at forward speaking for We'd with their to and like thank Yes. to of people look just end quarter. time the you.

Operator

concludes This for participating. call. conference today's Thank you

You may great a have Everyone, day. disconnect. now

Universal Health Services (UHS) 25 Oct 242024 Q3 Earnings call transcript