EHC - Earnings call transcript Q2 2024 | Encompass Health Corporation

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Operator

Good morning, everyone, and welcome to Encompass Health's Second Quarter 2024 Earnings Conference Call. [Operator Instructions] Today's conference call is being recorded.

If you have any objections, you may disconnect at this time. I will now turn the call over to Mark Miller, Encompass Health's Chief Investor Relations Officer. Please go ahead.

Mark Miller

good and operator, you, morning, everyone. Thank for Call. you joining Encompass Earnings XXXX Quarter Second Health's Thank

begin, you information we available second X-K Before if with on quarter copy, have filed encompasshealth.com. earnings the our a website release, SEC supplemental the and at Form do related are not already

information, of page greater the detail the will last safe set harbor On Page you also in X statements, the forth release. earnings of the supplemental find which are on

the are uncertainties, discussed and subject the will of developments when December are Form XXXX, Form related we make including the differ relating bad filed. year filings, XX-Q XX, which XXXX, labor trends from volume, ended you read uncertainties, for the our We for quarter forward-looking call, SEC them. ended debt projections, to as risks the in release the many ended to XX, cost XXXX, to to the materially our statements, the and earnings June that which control. expectations During and the and Certain company's like regulatory quarter Form beyond cause and are could March Form for well results encourage estimates and risks XX, XX-K as X-K, and those actual XX-Q

to undue a as statements. You on only forward-looking current based are on duty are future and the and to not information to speak presented, which reliance do other these estimates cautioned We place estimates, forward-looking not update projections, guidance events today. of undertake

call and certain information financial include measures. supplemental on this will Our discussion non-GAAP

information release as the Form filed the available GAAP comparable of part of directly the end with earnings most is and the to reconciliations end measures, yesterday of supplemental the the such at the SEC. X-K at For measure

All website. are on our available of which

we allow to rule that a adhere I one to one and question everyone everyone will the to follow-up question to submit remind would like question.

that, I'll back put to over turn President have Mark With the feel the Health's free Officer. Tarr, in questions, queue. please If Executive to Encompass call additional yourself you Chief and

Mark Tarr

and Mark, morning, you, everyone. good Thank

pleased an in second discharges and in EBITDA. performance are increased strong with of X.X% adjusted X.X% growth Total in same-store. as X.X% including facilitated X.X%, We revenue quarter for our discharge QX increase

growth conditions broad-based patient replacement smaller orthopedic categories, stroke, most and common our continues and while conditions other increases. Our trauma X.X% respectively, and across geographies to hip major type. discharge and be conditions, double-digit and knee and payers primary multiple treated grew Neurological X.X%, including experienced two

grew the discharges for are Doug our our of X.X% to the X.X% mix, in inpatient our for and largely the details Medicare Within his IRF QX Owing Medicare requiring and services guidance continuing the are needs comments. Demand the patients results, remained to quarter quarter. increased to strong cover Advantage additions meet XXXX of payer invest for increased services. rehabilitation quarter we will guidance. capacity in discharges while increasing again we

we expanded QX, addition we to our Island. new XX-bed hospitals. beds company as In Comprised and our we into of one During total for hospitals a XXX XX to Rhode novo a July, hospital Johnston, satellite beds, de XX-bed a capacity. with of three hospital added the of existing in beds opened state XXX

existing of expect a de year, and with Over we more the XXX XX novos to hospitals. beds to the two approximately balance open of total add additional beds

the relationship partnership expanded by are within Piedmont In Piedmont the Georgia. with IRF system We leading of a XX-bed of In we May, the expansion Georgia. venture Atlanta state July, existing XX-bed further we in in our the continuing healthcare hospital unit Hospital. opened Augusta our joint

wholly hospitals remains announced beyond in open development Loganville, owned to announced pipeline XXXX, balanced underway, ventures. and build hospitals and Piedmont plans previously Our joint relationship and projects already between Georgia. With with our joint six venture and now Athens, includes the robust XX and

culture health continuous and management company functionality We and supply system. the the specialized future within our Fusion operational predominantly capital intended support include create that Oracle to ERP infrastructure modules Oracle improvement. The the People of facilitate major platform organizations sustainable, an solutions to chain a care to our from undertake Fusion includes Other cloud-based to of conversion a from growth our Fusion. also recently conversion made an Soft is highly decision ERP capable human upgrade processes. current represent for financial and

that assist and have solution us strategic we maintain build We our consulting of to allows and firm a the design Fusion. us upon to with Oracle and implementation have are pleased identified relationship a with engaged to leading

earnest Our efforts began late expect live in sometime go this to regard we in in in and QX XXXX.

repurchase we During to $XXX common million. authorization, share of an our $XX back activity buying million. our in July, resumed we authorization quarter, shares share XXX,XXX also for announced our stock In under repurchase increase approximately approximately the

$X.XX We also dividend approximately per announced to an payable increase company's in of in XX% the next share. October quarterly

rule. IRFs our XXXX, final XX, included X, XXXX, basket would update mix. July we current October X%, X.X% This patient approximately based beginning market for IRF the XXXX increase net and released our CMS in of On estimate which a result on

more rehabilitation complex hospitals, to XXX are care we inpatient than providing medically cost-effective patients. our Across high-quality,

to outcomes. care, sources quality leading durables, satisfaction with resonates Our patient teams value to dedicated remains considerably population inpatient capacity work and and referral help increasingly U.S. services with The to this this We meet scores continue clinical underserved, need. to collaboratively payers. capabilities physicians This ages. for proposition and care producing demand grow and patients, administer continues in expand to the our tend rehabilitation as

Now I'll over it Doug. turn to

Douglas Coltharp

everyone. morning, Good Mark. Thanks,

this primarily QX really growth adjusted The of growth. X.X% X.X% another are resulted note, EBITDA with consecutive solid X including from same-store growth driving quarter same-store growth. marks X.X%, increase of I'll revenue We exceeding discharge report X.X%, pleased X%. revenue quarters increasing to discharge

was openings. New novo of by impacted timing the in store QX growth de

year Revenue million QX increase novo included provider not of Specifically, QX we in rolled therefore did this a two in until first And 'XX, tax $XX.X store openings mid-QX. in into in openings our had also beginning which same revenues. QX occur 'XX. de growth

audits is from claim our The claims 'XX. up expense net a experienced from establish revenue a ramped also initial in as through increase 'XX lower an per our increase QX, to of and includes practice was is debt in QX than QX in for to increased non-affirmed appeals necessity of The primary medical MAC, largest level low audit bad bad increase when expense review. Our in review revenue in Palmetto, To due Palmetto audits. leading elaborate, claim we in percent claim submitted reserves TPE X% audits the had discharge QX primarily spot factor medical debt RCD. to anticipated, to QX a necessity review X.X%. The significantly TPE under in increase of

the are an million of EBITDA from appealed have We net be inclusive approximately still resolved. and Adjusted provider benefit few approximately claims RCD stages QX in of yet to tax $X million, increased revenues. of X.X% in early the $XXX to

for our premium labor market. total. of was of Total expectations consistent a These were are million stabilizing $XX.X and expense labor QX with contract metrics FTEs labor X.X%

million We continue our cash $XXX.X free total free to $XXX.X $XX.X generate significant million. year-to-date cash to Adjusted flow bringing million, flow. increased

year of full free million. $XXX to $XXX We flow expect million cash adjusted

the X.Xx on our was We amounts credit liquidity million remained unrestricted $XXX.X and quarter billion facility. favorable. second in cash ended Net to $X revolving quarter end very and drawn leverage at X.Xx with compared with at leverage Our year-end. no

strength upgraded the corporate and unsecured performance, of BaX. reflective July, BaX to rating family our notes from consistency from our and in BX Moody's our rating BaX to In

of XX. also XXXX We million of August with of settlement a the redemption senior notes issued date notice due for $XXX our X.XX%

$XX.X As per million. mentioned, activity increased Mark our during authorization, a we our in shares And July, we $X.XX and repurchase declared QX, authorization share $XXX share repurchase XXX,XXX share. of resumed dividend for of under cash repurchasing million

$X.XXX XXXX range We billion operating of in of assume now revenue of billion $X.XX We range $X.XX guidance. $X.XX. per raising $X.XXX $X.XXX share a our billion, billion, and net a earnings adjusted to again adjusted are to to EBITDA with

The our XX several I supplemental of to and key take found a considerations Page slides, can to guidance the moment updates. want note underlying be on

now released last for a increase. week and IRF Medicare have X.X% Medicare We reflecting the QX, assumption updated final pricing our expect rule pricing

full claim in X.X% the revenue, Our bad in QX. debt to assumption to of for X.X% necessity experienced increase due reserves audits XXXX to has medical review increased year primarily

to $XX costs QX continue $X.X net million, our bringing de cost preopening XXXX. and million. preopening of $XX anticipate for ramp-up novo million year-to-date costs $X.X were million to We ramp-up to net and

the venture Q&A. conversion with to $X.X Fusion in existing Piedmont in noncontrolling costs lines of joint that, by expected approximate are hospital of interest, addition XXXX of expected to Oracle the NCI, XXXX The is second attributable $X.X we'll million. second the or with to the half approximately adjusted to for And income increase Georgia open half our million.

Operator

Leerink with Mayo [Operator take Instructions] from Whit our question first We'll Partners.

Benjamin Mayo

on on Maybe And dollar debt. just higher expectations, actually are given How what the these bad basis, half? audit that a the the first maybe into how incorporated versus audits you've than you and expected? that higher back just guide is higher higher the on thoughts

Douglas Coltharp

bit single in the a as little I were the And tend TPE. factor under The Yes. with little largest It's a outline audits to be hard Palmetto. lumpy. to here predict those TPE to activity my tried comments,

of getting before the claim them a much not when of saw and is several selected. Palmetto, selected end within there were very with activity for processed. all of are claims second since jurisdiction. practice do, it's is processed, claims few been processed And establish of we've each although because review selected, XX their a for the entitled after the to which our had of to been reserve more where claims wasn't favorable claims and there, hospitals quarter been quarters resolution So the accumulation selected that Palmetto really the they new from witnessed the those have by What is you reserve

that the the And our informs balance kind really of of outlook year. for so

Benjamin Mayo

a you you quarter Okay. or that becoming in not with question something. bit activity, I to year, uses the million. It but how buybacks nudged large buybacks, the little cash the Maybe on part a quarter presumed future. the maybe just, Doug, the of a amount was just a $XXX offline, up think a wasn't in authorization the know larger about just follow-up, more of but

of of want on go-forward kind to sort think Just how basis? evaluating a you're buybacks

Douglas Coltharp

cash in as time, of same with we the above kind CapEx. began that generating think leverage the previously, regard And is been about had discretionary free we down talked really has of all we our on We flow required level in flow our at Where crossed Yes. increases coming to fund based to EBITDA. the cash predominantly XXXX. the Rubicon year-over-year

in free stated we share the tended have dividend. gives to to beyond pretty to increase flow consistently that uses. capacity between approach additional capacity we shareholder a best allocate like think that other distributions, activity cash use us the And the So we and expansion, repurchase an balanced

moves the I think initial increased QX. we utilization in of or that would authorization, a stable of expect you the free And saw kind with that in our allocation cash more flow. become see direction, to

a time over to have authorization, but frame use to us We in don't in specific intend which line place for that it utilize. was put we

Mark Tarr

mean Board and is Mark, to this use free a of terms to Whit, I with is and common how best from in discussion how shareholders. this cash our frequent recognize our this

Operator

from with question A.J. comes next Our UBS. Rice

Albert Rice

I there? Maybe call that's And up you not of know sequentially to permanent I'm all your the we're and per from and guys X%. get figures but a mean bridging incremental people? on just to to reiterated labor? bed for maybe bit. seeing acute capacity on what's little Or anything your seeing out labor FTE else that due cost -- going I contract up that,

Douglas Coltharp

Yes.

with growth, I were several the at we last volume but that time which roughly we've think consecutive with growth important story we quarters, like to just level. keeping stores, the quarters in to X do not to the dollars regard of exceeding we're our of same-store level the I the again, labor, continues it's the X%. think is it consistent told grow, new that same-store stabilized premium felt discharge same note that

seem to bring that FTEs. be there'll X.X% near-term those, X.X% leverage although on that against necessarily stabilize We to of to So roughly at to continue down. we think we focus much trying don't

X.X% I in think up of the were -- of the SWB X% half for in year. year, first up being X% the assumption the terms to of a we

full of higher So to that that in we'd of have would up be the X% kind get to range end suggest the there. X% year to

some to may we there market-by-market change, proven of conditions so there. that built assumption uncertainty regard the market assumption. to particularly into geographic some that was But with on the lead just be and given And basis that conservatism labor think it it fact can a the

Mark Tarr

labor. contract that A.J.,

XX within was spend the hospitals of for XX% QX. So

So bit it's within a and challenge. those a a small marketplace percentage remain of of some just of that our hospitals still

Douglas Coltharp

served adjustments, that being around really regard With us with regarding philosophy again, has well. to proactive market

levels turnover both Our favorable for QX. again, were, therapy and nursing very in

have at to great RN net new continue success We hires.

against So one. that's we probably level on the somewhat think inflation SWB it's a trade-off higher good

Albert Rice

of to I stable. of otherwise to underlying and I noticed -- percentage to X.X%, is there? growth Or Anything point Advantage call continue care that mix traditional what you down, little got growth your or mean, what's you call wise contracting Advantage out know call in Okay. out? that? a revenue base about Any is you Medicare driving X.X in see Medicare pretty I enrollment anything about managed at we is

Douglas Coltharp

on plans. continue Advantage to kind XX% overall our No. good No, of growth. it contracted do with versus Medicare we pricing feel And X% the Medicare overall approved We is basis. of inroads perspective. in really just again, at tracking just episodic a to a Medicare Advantage the book of Medicare like once make market revenue about were I think is discount an from we Advantage

about happening payer that with class. and about feel is our value what's proposition So the resonating there way good

Mark Tarr

that to as ability the we've which sweet get Medicare through percentage as to programs really large proposition we see we cases we feel are area developed AJ, back provide Advantage programs an and spot are patients patients, that before, that value our complex a and stroke is more that of a to communities. those medically said the

Operator

from question next our Mok take Barclays. with We'll Andrew

Andrew Mok

It number quarter? then the And was just deceleration the you in like implied half. largely back below though looks components. like on follow the to is in half, what in first SWB FTE cost clarify increase is guidance bad up the I low guidance want the there's start-up looks your even can it debt XQ, tracking impacting end an the per the and of Is,

that in items need back to we other any half for consider So the guidance?

Douglas Coltharp

Okay.

year-to-date, ramp-up in $X.X assumption to quarter, the unchanged So million $X.X costs, first million at year on full $XX preopening million. the $XX million

half. the we think would higher in Augusta year, we there to ran inflation for X% suggest the that think come a I if the venture, do, are that full half mentioned why that the that Piedmont year We to that call things I assumption, NCI prudent half, first the conversion know adding and don't the to leave X.X% at fruition. from and this second point. That's will impact the that for Fusion would X% based our of to it may conservatism Oracle of there I but the potentially rate hospital we it's then joint out the in second cost, to SWB think we increase earlier, be the fact some at on

Andrew Mok

follow just Great. And could if I up.

to your exposure second programs other these tax side? us quarter second you that the The not and the is have some this in provider outpatient -- on seen and whether exposure help you inpatient the the understand or row Can broadly business. flowing side a we've through of revenue more

Douglas Coltharp

very some predict. It's difficult have form to program that's and there. very out states Most of volatile

to get is lot your don't tends our which You year. line fiscal the be with There doesn't of what align a on most participation -- doesn't be. a in into instances, visibility fiscal time state's to based going year,

it be So really could lumpy.

negligible. was year, at it If you the quarters, X last in first look

kind into very us of of some hard of just result, of incorporate our saying of a so predict, to period, in And it's really of a this -- as and it that difficult any guidance. is way -- it's some it for it's is out it's to period, long-range

Operator

from Deutsche Pito comes Bank. question Chickering next with Our

Pito Chickering

the the the headwinds the I pricing updated from $XX of about Oracle, estimated sale and $X Medicare previous from EBITDA. tax million guidance for guidance, versus at looking about JV fact tail-ends So in our million changes at of provide

good about Is I guidance way our raise that $XX $XX think your million headwinds. impact the our a headwinds guidance with think negative change? the net So and a from to about million by

Douglas Coltharp

Yes.

the of you kind thinking been give the that I'll math about it, way So Pito. I've

point. a now starting EBITDA guidance better I'm for focused of lack at so And midpoint the on the

it's and included have And initial were up to point, headwinds that in million. initial But guidance. our not so from there tailwinds been $XX.X your that guidance,

the So for provider the half tailwinds, of first of impact $XX EBITDA we've in terms tax on had billion.

guidance into accrual positive had also $X initial million. that insurance We adjustments were of our factored

so Piedmont So that's go $XX $XX the if million, and are million. $X you Offsetting midpoint that, revised $XX range, And then to together bank on the debt the about impact. million. million that's it's Fusion

million. the $XX So net of in volume of up been million the strength really, gone saw to that a by the guide year. attributable all of half headwind has which suggest in to the that And million, the $X has would first of we midpoint $XX.X EBITDA

Pito Chickering

it. the Got your think of guess leverage that the core Okay. back revenue guidance versus leverage? with or better year, half is you previous I changing at looking then And your not so margin do much. where

Douglas Coltharp

I'm that question give didn't last quite I again? get that. could me sorry, Pito, you

Pito Chickering

sort to of question. guidance the back guess I

much [ at better back not how You're guidance the of back that revenue we much about guess, the the year is that core changing not glaring margins revenue half so of ] or in up year? better you versus previous your should your that guidance, just seeing margin half flying thinking I

Douglas Coltharp

a little of kind on I slow that again. might had sorry, I'm follow-up this trouble I be morning.

Pito Chickering

actually. Apologies,

what in change is of the build So billing down has versus want to I I last in to that a cost de to guess, XXXX that new elation just year? pressure novo, one novo come sort skip going better for that in RRC one the and facility XXXX, de

Douglas Coltharp

Yes.

about for to for in opened, of in head lot is idea more are to an Right of new because supply inflation do $X.X down per really slowing activity. the of we've while. time de some the use that X seen expansions costs X.X a of always passing so the just hang as A horizon. that pretty efficiencies. of we've our you're $XXX,XXX and Then about time roughly until that relatively in now, been also time market. novo has there gets And X-year stable at then well and result chain our That's looking bed million about forward novo some prefabrication a it years the first a have been to with those it de talking

per to ROICs, forward terms In cost attractive is pro new continue with still the generate we we which why to formas the of seeing ROIC, are stable, state additions. bed capacity with entirely push

Operator

question comes America. next Our from Fischbeck Bank of Kevin with

Kevin Fischbeck

So a couple guess I questions. of

be But right one, we guidance that second be just how costs we we wasn't number? Should components year it's to annual up thinking the we are we the bad think clear we additional And headwinds Piedmont we of number? this going thinking about rate -- First it have back and in year? going full kind it the Should right about should the these seems is be think then like half in double it Or next the number just XXXX, to all XXX% year. the number? be half think XXXX of I is fusion about the of about? me guess the to run there year, impact a as that costs, as the about to ramped say

Douglas Coltharp

Yes.

minus second for Piedmont bit, think intend range go when an Piedmont progress the half XXXX. initial formulate the just estimate on for knowing plus to early for not maybe numbers of year and debt, at through bad by Fusion on it's full the a to this for The activity I multiply infusion, make live. on estimate we an little of the to XXXX based or X, too on us based growth So and of take

that would history Although the here is pencil over last markedly I we've don't today years. think had from sitting the or anything that X different I of kind X

We'll what we a in of much peak the and expect why to see year. some it think I to just normalize in and how QX was of we a how bit fast. saw second the have half that's

Kevin Fischbeck

being joint I'm once put with But And involved helpful. you to into with joint of already. you've guess ventures, Devon, been create I guess used kind a then That's seeing Okay. with venture I facilities them them.

yourself? into venture keeping an do benefit get by versus of adding what joint So facility just all economics the additional a kind of you

Douglas Coltharp

historically and we had had in venture, in market, in existing we've been there years. an so presence one acute have care added Georgia. specifically, And this couple Newnan had better we've a existing Augusta, than one for XX have Georgia facilities acquired Georgia hospital added not that that the joint an a of they and Augusta, did hospital. into was Piedmont Piedmont that

was we it the terms consistent in So partnered together. overlap in of Georgia approaching how where be markets state of we're to entire

Operator

with comes question next Our from Scott Stephens. Fidel

Scott Fidel

First question.

the wages growth sustain were opportunistic now X just So you you're about the that that on discharge quarters consecutive same-store least thinking what to about fact investing talking just of and X% on in being at capacity. clinical

As we updated in we be the the as guidance? year. least looking the fourth implied in same-store at that to growth guidance X% discharge you quarters and about both full thinking Should third target think about the delivering for

Douglas Coltharp

don't discharge what provide expect to or adhere guidance range. CAGR consistently quarterly a we've growth have before to we or and we that metrics. that X% to range been growth of around we volume above other delivering is think What continue said and X% any I specific that within We

in as remains his services, comments, Demand for good. Mark cited

in Our staffing we of the constraint been hospitals facilities. And patients demands our to being not meet being capability have able those terms has foresee serve do a or well. to the for constraint volume a

Scott Fidel

a Okay. follow-up Got then question. it. And

'XX in Just 'XX, of managed with as will obviously, I sort continue. backdrop reimbursement it interactions and a guess, -- challenging been the pressure just payers for as care the it's interested relates to the contracting latest, MA

has MA been that? the contracting of change curious, just any in from posture because there So plans

of Advantage they're management plans, sort tightening well I from, sort you've of of of some because as that things any also behaviors then the Medicare financial pressures sort management medical And side facing. seen of guess, whether of just and the utilization the from for the just managed

Douglas Coltharp

contracting, years no, of in year, the a they time frame. this you hasn't large of there feel to the of annual where terms between nature very had increases share particularly that really to been compelled that not and MA change number us any that significant did discussions the with the two. I'll in remind prior So plans were during there

have both ways. can't you it So

to those gets constructive, the With markets. once becoming MA the I in improving no actual that and a the done screening policies is it plans say lot are and regard pre-authorization challenge relationship that by that in our place, but there more the would doubt is plans remains a of

talented our MA and all of for an come have that very hard patients make as patients our inpatient very one well, go so work sure care hospitals need true opportunity We to those get and can to people of rehabilitation well. in they of hospitals that's to who have

Mark Tarr

benefit to a gotten Think justify our then, emission be very or medical that the the potential working by and approach even in seen the gains directors from our may detail of thing one be we nurses our should our patient we've that have clinical patient with that clinical hospitals. and therapists or that maybe support

clinicians So medical past. directors than what in our had a to we've greater the much and that in degree we involved process

Operator

next from Brian Jefferies. [Operator Tanquilut question Instructions]. We'll with our take

Brian Tanquilut

here, is there it So the right? then claims there national reserve or audit. that thing? Maybe release just expect or processed, or the maybe go Doug, mechanism is Maybe, should broader And Palmetto a -- specific just as the on as to we are more I think road? the are this could down expect back a about is to

Douglas Coltharp

Yes.

a when been majority as are the it's immediately had activity exactly Palmetto. Palmetto and end had So -- at with the the selected they long had claims I'll rendered been them Brian, then largest and reserve all works we claim we you out is that you very a of -- of those our selected, with it remind -- shot. a of exactly by And decision upon QX. established QX said, a in few has

those point, get claims go have we actually processed. a reserve been QX more comes this approved. are the and to have release soon then we ahead approved, cash are they're resolution, of as reserve. the we Many As in, they And the as of approved. once end beyond And the release favorable they progressed

Brian Tanquilut

it. maybe, Got then Okay. And Mark...

Douglas Coltharp

quarter, review, selected in there expense that through that bad would that of are a you the As claims flows of for we some experienced incremental reversal the unless QX. are see debt

Brian Tanquilut

should makes And an seeing then That think announcement sense. plans? Rhode it. got maybe, how Are or as I you I you've Mark, that about -- opened thinking mean, you outside Got your states attractive about as opportunities entry current for you new are thinking states? are market Are new that that of for Island. there geographies guys screening footprint we be Yes. there about?

Mark Tarr

Yes.

can got be Connecticut new on for look I state development the next terms activity. and the there. us of on a states, about That Island of excited will year. slides Danbury, states, You in some mentioned earlier. you've our you Rhode new very We're But if other look at

within excited also we're You states to existing that pursue. geographies have

the we examine could -- that have be certain states. to states There approach enter So in that potential will of we different literally opportunities are and a new never geographies but any marketplace for terms MSA us. broad evaluating a enter,

Douglas Coltharp

bed, you services, look IRF as we wind that the number remind I the XX%. a eligible IRF year rate about just up at And that there demand if a that a out proxy CMS-XX for care only nationwide of in for of conversion hospitals is discharges acute presumptively ultimately coming

aging in year of and every the country. just So increasing we that demand know a given demographic there's there, that this is out demand unmet lot

Operator

Our Haase comes Blair. from Jared next with question William

Jared Haase

that you a And shaped a sort the that just then back quarter? assumption bit on Is a it were on be of nuances did fair metric one Occupancy of the half share the quarter. any in up terms but year? would sequentially. that of comments any there how the other decline for quick typical what Maybe for again just seasonality? was up nicely year-over-year, Or

Douglas Coltharp

Yes.

in So on in in normally of strong the capacity. second bring half QX, of that perspective. seasonality, beds occupancy did also any quarter on came added and from we And we QX based quarter. XXX an not the those QX, most by was QX on is impacted the fact very a for us new

down And on weighs so that in phase. the you're ramp-up occupancy while

Jared Haase

the That XXXX. trends. you guys makes how labor just then trends. of lead I the any another for ask was sense. sure market early, try if but to there's I Obviously, wondering year. things terms can on for will in in of typically by inflation to I'm expectation And half shape the be you of the specifically, one And inflation know wanted it's on share just maybe color that I some up second

maybe share of broader industry? in So the any you'd expectations terms thoughts of

Mark Tarr

Jared, it's Mark. talent seeing on of nurses that our recruitment effort I acquisition a nice put into some trends a ability and marketplaces. can our our what and we of in We're retain is our to the therapists. function. We've seeing some comment we're now, certainly of normalization right lot mean,

they to, If rates, you not than pre-pandemic. better, equal turnover are if look at our

which that fully there. if So continue expect, growth we continue able then the grow out we future, be were a service these have to certainly trends company. positioned in be to continue to And we'll to as well the

Douglas Coltharp

this macroeconomic in a volatility out picture of lot the witnessed Obviously, all there now as week. overall we've right

the half see next predict X.X%. So feels we that going it's what's level roughly hard down that hope saw that what and of in happen kind of inflation for it a settle first we of overall little is to maybe we labor year. to But things into

Operator

Raymond James. comes from Ransom Our John next with question

John Ransom

have stabilized? the -- those is right If pickup. patterns now think question health off is SNFs, role we do have changes, of Has yourself a one. think broader referral of here a is the lot home are timer of but where diminish. a do the you post-acute My kind I at you to conveners you to as Sorry, been landscape, there's have we look to that going

So engine you other this? are going a over looking fight settled to think I than kind knife to for still do and out referrals the that are go? have Or where we've going all of you

Mark Tarr

it's Mark. So John,

nursing that resources complex in certainly, think continue terms in more ability in our COVID medically other to immediately because more from our we during we certainly, took that out get lack and we IRFs. to stated outcomes market to of of of post-acute capabilities and advantage favor majority medical that patients. think reason I which resources and or staffing of thereof can And we different do the played in a of the handle complex settings of better patients. the have show just share take I handle ability homes, terms because I that post-COVID

changed run, actions in that marketplace, to run. long I certainly a some there settling the think a play might real COVID run, settling, them post whenever out had might be the convenience the be of I of of sense So in be that the enter but aggressive there's there fair in there, that been still think has amount we've impact a outcomes short-term seen short terms our some and terms on impact refineries basis on the the long there any in favor out worked but

Douglas Coltharp

where period was seem do kind of they much be they that frequently to most And less popular. XXXX up say, XXXX, from popping to they were than which were,

John Ransom

I layoffs, mean not Yes. coming if thought with is to help I on. and day their of sort wonder just the I

Operator

period. I over additional now back call Miller the will or any conclude today's question-and-answer turn for This Mr. remarks. to closing does Mark

Mark Miller

operator. additional (XXX) today's Thank If call you, questions, XXX-XXXX. you at please for anyone call. Thank again joining me has

Operator

program. for does This today's Thank your you conclude participation.

at disconnect may time. You any

Encompass Health (EHC) 6 Aug 242024 Q2 Earnings call transcript