AMED - Earnings call transcript Q4 2019

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Operator

Greetings welcome to the Amedisys Fourth Quarter and Year-End 2019 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host Nick Muscato, Vice President of Strategic Finance. may you sir, you, begin. Thank

Nick Muscato

A and Thank available related Conference and Form the press on XXXX. Investor X-K website. filings SEC Investor to to you, year-end supplemental discuss are and XX, quarter the operator, our Call fourth the Amedisys the Relations our of the welcome results slides of copy with December release, of page

joining Chief us call Senior from Affairs. Chris General Financial Amedisys Executive Kusserow, Officer; today’s Paul Chief Kemmerly, and on Operating Speaking Officer. Vice Chief be Also is Gerard, Dave Government Officer; Ginn, Scott will President and of and Counsel

we forward-looking Before to are available under the Safe update to These on is other with the made Act. this would obligation I conference Amedisys provided Private than today. Harbor statements call reflect of on protected are on like under to assumes the this constitute securities call laws. calls, no events, information based Securities and to information get today Reform Litigation everyone statements statements subsequent applicable started Company remind required that may our forward-looking

actual These such to our forward-looking involve of or number uncertainties, differ may including our factors filings, statements SEC and cause and results Company’s materially XX-Q a which from uncertainties risks X-K. statements. the and These risks include may outcomes detailed XX-K, Forms

SEC be X-K. a today of reconciliation G, any available by Form mentioned will Regulation most to the call as during comparable measures in required our In GAAP addition, non-GAAP measures our also

the Paul now, Amedisys’ and CEO, turn I’ll to over you, Thank call Kusserow.

Paul Kusserow

earnings call. Amedisys XXXX the quarter and year-end welcome and Nick, to Thanks, fourth

it these past, hyperbole performance in XXXX XXXX generally beyond. have our try tremendous. inaccurate as to describe but things to and today, on present future, and XXXX, talk would not and We three XXXX to We avoid calls, be about

Some the highlights were. of

total least XX,XXX than our XX% lowered $XXX turnover our lowest XX.X lines to of adjusted to-date. for day, score million basis level of honor At We XX% margin from $XXX We patients million caring XX.X%, achieved business. EBITDA three Home our voluntary to care XX.X%. a our over to the Health million points had across We've or visits X.X grew great centers each of while of expanding all making XX above. more EBITDA star

on that closed XXXX. to RoseRock X, I'd Care of the while have Asana the acquisitions all to note, We the Hospice welcome truly are Asana Compassionate to Hospice we excited organization. January family. you Hospice On associates like Amedisys' closing on and join

all to hospice patients at drive fits to provide the we culture perfectly highest-quality the your care Amedisys. with You're created unwavering have

Touch with XX% Next, safeguarding our we on Care our to care PDGM the from centers expanded our nearly relationship XX%, and increasing by further Medalogix transition. products

reduction focused hospitalization For outcomes and utilization. you a story, is our on newer program to those of individualized program providing Touch on focused is optimize care and patient plan Care a to both

and to quarter one possible of patients want strong care our thus our has we for And Next, Personal Care prep work practiced practiced, of this and in for to with deliver care None their would far last, we results. unwavering XX,XXX outstanding nationwide providing service I great paying-off. commitment needed our this care scale we practiced made thank a every without and to PDGM further towards as such focus us care partnership employees, on personal ClearCare, giving over great homes, year whose executed you coordination. at and an and be is innovative helping possible.

Always, operational strategic quality. and pillars, a quality, efficiency, take the now fourth our growth. let's first year full the quarter that, it look relates to at and XXXX as people, is With results, four

in the the to-date. so why If and we best put my into what's getting a you been and reason everything It's it, point care the deliver successful morning? have up to have non-negotiable the hold you don't opinion, of yourself in accountable it's us

of patient score while centers of and patient centers care a QPC the preview. were of four achieved April our XX% We quality care stars care five of XX% star quality of at X.XX stars, of we our as had XXXX care

Our hospice all against. we outperformed average the again business measurement set the hospice in categories of national at the players national and is once benchmarked item top

you our passionate, Secondly, want people, with who best their vote excluding you if you and turnover every employees great productive ever. work in you, year results total to voluntary that care, full PRN art XX.X%. we These practice day, don't are to can't for deliver to drove have to

processes be care great Third, operational great need people great tools to deliver their to impact. maximize productivity and and great efficiency, able to and

margin operational lines on again driven our higher XX within and focus adjusted all margin points of expansion of we than efficiency has ended XX.X% of once EBITDA in XXXX. basis XXXX business, Our

you the growth, should best if best people tools, disproportionately. grow have And best finally, care, you delivering with the the

and the grew our quarter for we X% for we the ahead ADC range Hospic, and for total X% quarter year. guidance In admissions Health, X% X%. for store the same store of X% same For Home of the were year

the January Xst, On XXX the hospice to deal inorganic adding ADC front, on Asana we our close census.

In asset by We tuck-ins already one seen the more already and look of while PDGM this Missouri more signs have interested calling. be in caused hospice having Home disruption absorbed we'll very Health, continue we to to do early been and in year. more have

to strategic themselves, We as via particularly but in space. also grow inorganic share they interested will continue present opportunities absorption, CON in are

great see, can incredible and on As you had we quarter fronts. all an another year

growth people, operational people of and is of the Our, by strategy the people working. quality excellence

guidance increased Again, twice the employees done drive XXXX. all to our for all you've for in outperformed to thanks success up and the ranges, continued ourselves growth Amedisys set success. have and we We

our drives without an continue You that people end better to focusing on better prove and results yet increasingly patients insight. and

keenly we on it financial touch results, initiatives guidance be focused on the XXXX. want key turn Scott will I I to Before to few discuss over and to during a that

our help business. of all lines care All highest us across patients which will of deliver to quality the

single months, to drivers is XXXX levers initiative and episode the which offset discussed the and grow assumption, as the at visits the PDGM, utilization, under behavioral great in cost revenue over we thrive have to per new between we optimization, such length Our impact last PTA stand payment LPN and course of ready biggest and XX system.

In QX our XX.X%. XX.X% we to utilization to XX.X%, XX.X% we QX utilization and up 'XX, in increased increased our up up LPN 'XX from from PTA

and expand to results most to now for Care within continue get efficient Center Home XX the in also We patients. agencies have optimizing the portfolio Health care our our of best quality Medalogix our utilization

we've analytics individualized optimizing patient-specific on to with help ours ensure, plan appropriately-skilled care individual Care based in a this clinicians as uses to down The many per have from needs. improving. are promising to and are reduced we XX, our holding and XX.X in others' that patient's cases QX strong per results robust ratings episode visits episode quality been visits the deliver and most 'XX quarter, while each data the

PDGM With now, clinical have nearly our positive. seven report back been under of to disruption. am teams not early office experienced our has thus quite and has our pleased belts much far CMS experience I gone processing and weeks smoothly claims

reaching broader we are in out industry, expected seeing operators the As for smaller uptick help. in an

of opportunities a XXXX growing We are have pipeline evaluating absorbed we asset one and similar late year. this in

know preparation I we the throughout and of success more We'll our dividends am will remainder but so confident tireless continue this that, so Our in in a far PDGM's cleaner PDGM for XXXX, year. March, is of view impact have paying much in early good. when full,

of $XX EBITDA contribution big delivering the Compassionate on XXXX million initiative is million. Hospice $XX Care next Our to

focus This XXXX. efficiently we We we will the expectations in have developed be grow made market is and progress a of operate a in to confident consistent engine and integration fine-tuned above in XXXX, and asset remain that our we promised. will XXXX. business outperformed growth lines all poised of we three the EBITDA Continuing initial deliver more major

more our a sales We businesses, across patterns usage of lines people. more advantages of to consistent development staff we've quality out-sized as year be our sophisticated marketing have we and data with capitalize to business referral and and source of activity the related proprietary all build expect XXXX and tools in and growth built on and become

to we will build necessary the be personal we will be and provide in care an our necessary this feed was The coordinated arrangement executed network. to just to to to and operationalize continue XXXX. payers. pieces year our Finally, patients truly continuing in for innovative network team a step build-out build process ClearCare iterative in to will truly the with our to be the XXXX infrastructure focus a one care what invest XXXX in

most though then, XXXX We and us. well early behind PDGM the should be we by of half XXXX stock excited XXXX are first about

and levels, chronic integrated at will at differentiator plans be fully betting will Our for legacy and new and integrated to hospice a members are growth our Home operating margin rate their keep and wanting that focusing Health be MA home. assets we

you update these will and the as beyond, throughout we We on major XXXX milestones. reach initiatives

well over Scott? performance that, quarter financial with for of year turn the detailed through And Ginn guidance Scott to our I'll take XXXX. review our who will for as it a more and us as

Scott Ginn

Thanks, quarter Paul. excellent financial I'm very pleased another and full year to report results.

income a to of on the on $XX delivered an XXXX. net diluted revenue, or XX% we $XXX basis, million XXXX in of compared GAAP $X.XX quarter fourth million per the For increase share

or share, an in or income increase revenue, per $X.XX we For $XXX diluted million XXXX. net an billion XX% compared to year, the of delivered of $X.XX increase $X of

For characterized by our that our impacted temporary were have the income nature. or one-time GAAP items as adjusting results non-core we results in quarter, expense or

supplemental in the impacts. adjustment these item, Slide slides items our each statement provides in items regarding line XX each details income

EBITDA our to EBITDA the XX as Revenue as million. or basis, over million points and increased $XX EPS on $X increased follows. of For quarter increased a basis $X.XX XX% XX XX% grew million. percentage million or cents an share. per adjusted were revenue $X.XX to $XXX of results

million revenue percentage points, adjusted were an million, XX% our million results $X.XX on follows. $X.XX EBITDA or basis, year increased to basis or billion. the an XX increased or share. $XX EPS a and $XXX to $XXX For grew per EBITDA XX% Revenue of increased of impressive as XX% as $X.XX

results indicate year As XXXX a Amedisys. tremendous for our was

continue successfully our segment. growth we our on financial for our As results hospice execute that while match deliver to to strategy excellence or executing plan inorganic clinical

increases effective performance, to of seasonality sequential segment health remind want QX. few approximately claims added August you approximately in Xst $X.X Planned $X in workers turn I million. wage to impact and items and costs, that added our insurance a comp million performance I Before

segment turn into same-store adjusted now total million, or performance. our allocation. $XXX volume a pre-corporate was compared both to Health, driven In up will level million revenue Keep X% the and quarter I XX mind, year, admissions. by segment X% in fourth prior in is Home increase EBITDA

a $X.XX, X% Visiting clinician over cost salary planned driven per prior visit increased Overall year. increase mostly increased by per $X.XX, cost increases. visit

improvement margin XX. gross was as basis Our points XX.X increases year-over-year as by across in business rate payers prepaid decrease all well driven to of XXX a from

this QX We comparison have as year-over-year XXXX, slightly 'XX, seen of ahead throughout we sequential began of in XXXX. improvement

EBITDA EBITDA basis point margin an to with a improvement $XX.X improvement since EBITDA represents point XXXX. prior improvement. $X.X which was of XX.X% XXX full XX XX.X%, over basis million, year year segment basis and XXXX, was representing up the a margin point XXX The million of for a

up items to will impacting increasing. in which a points model the segment our raises our staffing compared Home as the shift Other revenue a XXXX, results quarter was XX of be XX.X% is percentage fourth of for include and Health quarter, basis

the out plan phased and November per over of payers effective visit. episodic XXXX, Finally, their plan pay have to offerings X, one the members our transferred

We financial expect impact. minimal

our segment hospice results. to turning Now

per fourth census For up increase million XX X% per was average up over per was X% up $XXX.XX day was and at an year, cents. Same-store revenue daily million, quarter, cost X%, was of to XX%. $XX.XX revenue net $XXX service day the cents prior

of XX%. million added segment revenue million million, XX% which XX XX was year increase an million. of inclusive over G&A for Hospice EBITDA the to of prior increase up activity X.X was XX acquisition

EBITDA was the our CCH impacted margin acquisitions. by and RoseRock of the inclusion

improved these from prior Hospice margins impact acquisitions year. are of EBITDA the Excluding

in million RoseRock quarter, the million CCH segment. Hospice for revenue, and in the added and $XX For $X acquisition

CCH RoseRock million and million XX and For Hospice segment in revenue EBITDA. the and year in XXX pre-corporate

basis Care points revenue in Personal generated million quarter prior Our the and approximately improved year. fourth segment EBITDA by XXX XX over of margin

Our by growth. strong economy to our continued the difficulty limit driven

acquisitions. years inclusive Our comparable they're of prior to results are not as

over was and our increased XX.X% G&A prior total acquisitions to sales general Turning revenue. related million administrative to On approximately expenses. of additional Total or employees our and driven basis, by total adjusted Hospice X $XX support million an G&A million to $XXX million for growth. XX year total

PDGM following. of investments nearly made for including, and preparation staffing security XXXX G&A novos. enhancements, in pilots changes, Additionally, expansions $X innovation de purposeful we million and model pay have the redesign practice, IT

in flow leverage nearly generated cash grooming credit our from revolving facilities approximately $XX.X the cash X.X we ratios fourth million quarter, bring significant times. down million flow continues on operations in XX paid and Our net

X.X Our decline XX.X sequentially DSO three to day.

excluding promised funding the we end revolver fully of the CCH the of line QX, borrowing the we of paid Asana As acquisition off at acquisition. all

XXX January the in I we've million de X, cash Hospice year, with of and from year growth progress free operations million pleased acquisition, very For the flow. generated am and ended additional closing cash $XXX XXXX with we flows during novos. XXXX strategy acquisition on did in our inorganic the XX

our Page for XX can fiscal see you guidance our as on we're Finally, XXXX. deck, of leasing year slide supplemental

factors $X.XX of There to XX on key EBITDA Our of XXX guidance XXXX slides. revenue guidance to XX X.XX adjusted XXX million, of supplemental to $X.XX. ranges our and several $X.XX EPS impacting outlined our are Slide billion, adjusted to

Amedisys' First, and basis points; points is of increase of our PGDM facilities approximately translate impact. negative X.X%, will restroom a to XX pricing up the the margin into through however, specific headwind majority reimbursement general be inpatient XX Hospice passed basis

as For of CCG million. the numbers CCH, $XX $XX to of and will be our in estimating million EBITDA XXXX. included February range X, we're same-store

approximately Planned XXXX be our the half year. second impacted to of will of impact million given will is X% spend. increases XXXX. of effective raises raises in the the of X% by XXXX to August in increased $XX $XX of Keep that mind, first total, results in million XXXX In half be wage to

XX% Our XX%. with tax of approximately estimated effective is rate approximately an tax rate assumption cash

Personal $X Continued includes incremental in approximately projects $XX and million novos de of investments future $X million, including approximately resource approximately additional the approximately of in of the business of partnership and $X million, build-out which of spend innovations following; PDGM Care million. investments

we confident in are mentioned, around our efforts very Paul As PDGM. preparation

heavier we've the different impact we than much weighted Accordingly, back throughout offset will historical of As XXXX, dated to in the performance discussed be looks EBITDA XXXX. our the cost half levers our in expect patterns. XXXX

There our include, EBITDA are our will XXXX cause $X than those also impact related year. progression to to rate call of from QX to I'd QX items miles like million sequential that XXXX additional different the our some out prior in benefit from $X million was XXXX $X noted for a will which now in year-over-year for realized XXXX gains and comp, contributions positive CCH both of fleet accounts Health non-recurring These Home approximately million. in approximately the of Hospice, and

beyond. XX.X around as translate materialize Finally, this efforts guidance shares. assumes we XXXX that fully our combined diluted and share from that, half We meaningful and that will our growth upside acquisitions the continued into contribution in second the count million XXXX Hospice will move with PDGM of the to believe of a

please This open will conclude remarks. our Operator, questions. the for prepared line

Operator

Please from Thank you. proceed first with Jefferies. the Tanquilut [Operator Instructions] with comes Our of question question. line your Brian

Brian Tanquilut

First question for Paul. you,

but from the most growth, of year a the year. you you'd factors know acceleration growth what be we I about think growth that that thinking QX how you're guidance decelerated for did organic on Health for So, and for kind Home the the QX? the forecasting bit little should as Hospice the impacted And about for I segments of I performance both be XXXX. growth, an for noticed

rate run into thinking that just bridging So, don't mind us through, growth, or QX you're exiting about XXXX? performance QX if how you the

Paul Kusserow

out Homecare, in QX both prep. management Sure. Home and and the integration was Home PDGM were question, heads in the to teams. the an down build sense for CCH were on starting to Thanks down Hospice Homebase finally Health finishing then we heads Yes, Health, for Hospice, Brian. integration, interesting we on that, And time

to areas So of the did think is what lot growth on concentration we due I in think what And I think we I the desired. QX, confidence. these wasn't we a have

So we're with in year. steam the bringing of of this head terms in,

building we're to So, particularly out. numbers, going confident we're that Hospice we're know we the hit in

we of that There wall all were other while we have a issues, need terms We was in reps these of on out the concentrating there. hiring. a bit

where XXX So corrected little to We the and what in But need we we that get we were like certain first. XX, on off. behind, were got XX that off, we've prior know a maybe cases, did we to growth have reps we not to. we accelerate about, through the

it far. we're quite thus about any? I good So feeling know don't Chris,

Chris Gerard

on little Yes, A progression. layered 'XX We just QX, we a noise bit examples consistency is of as well. this did on total admission of out numbers XXXX, was our our our What a -- lines QX across in 'XX X%. and X%. color the X% QX on X% there of comp comp on each year, those our on kind on X% a was then year is? XXXX is trend with of And comp couple and X% chart show X% was QX, and little the our of QX flat, comp crop Medicare total for a growth a was of growth and a

a some had that of I So, line inner in confident consistent. the quarter trend feel of our bit we is factors, little noise just kind other of

the Our 'XX XXXX 'XX to 'XX you should the trend from same what 'XX. seen see to deviate 'XX. And should progression to lines not thing we've from much is 'XX,

Brian Tanquilut

then, I your acceleration about prepared and talked remarks, in guess, And you've beyond. XXXX Scott, that. Appreciate

and noise how all you If volumes about, thinking are do do you about guys think the again, the How about mentioned? that your you about How don't past you the think mind environment put XXXX? through, in walking that together growth of us as absorption guys reimbursement? you're thinking M&A you

Scott Ginn

absorb questions terrible it's around some going may think, in about felt still that's impact. from back is the start if flow because half, you activity world, still when all that feel the think consolidation, payment we I most that the the else whether of I can still we everything with from just it Yes, on, think you cash

think of impact think I forward. revenue piece. said, heavy was our still we the about we So, loaded, if you move on the back as X.X%

I going our to modeling for I adjustment, will then so by average full comorbidity probably that from going think million be on of probably a we're $X to we bit a up, be on and offset, be in think we're we and cover fine little our QX year. that about short

going PTA, So one from you'll in average for will LPN probably the and visits that PT, that the piece we and QX, the and we're visit then in gets And year, up mix, get RN mix and think the to there. we around XX% picked see to the QX. but

it different well best and I down Typically, quarters and in just think QX QX. is looks that we into of one pull QX. QX our

I how think the window that's look. for out we

still forward I performance thinking think the different in QX we we're how continue movements and to the levers. build all through

Brian Tanquilut

XXXX, And that an then acceleration is just, year you Scott, think?

Scott Ginn

at I around rate the think our and money in on tremendous as a CCH. the good be and got upside we it's multiplier to look these we just, levers come through. exit upside a hit opportunity entire It's continued run tremendous

our in if rates think way the So, XXXX QX some those as exit yes, first quarter, pretty even I in there's plans us. exceptionally for chop out to XX

Scott Ginn

good heading Hospice. integrated Home really And on levers Health think rely going of the in to the this the we're we're cost be good terms and Yes, on half into then is long all where we need we'll view. on to so we're in we're feeling feeling fully year how pretty where good. the second about of and We're going shape

should be cooking with we gas. So,

we feel quite in about this. So, generally good

Operator

Thank you.

of from your with next proceed Please line Blair. Larew Our question William with question. the comes Matt

Matt Larew

that question at to, you or first the new down but operational imagine an I kind that to and QX and focused of in sales on Or the quickly you agencies point? agencies give a it's management you alluded I will QX, information largely and to not are on you continuing into wanted Brian's was at just follow-up level, for only fourth sources mix. what heads level, maybe they're place PDGM focus feel to folks Can Paul, staffing also PDGM? in obviously, whether that about quarter. referral talking on around on the need things your this growth a sense QX like some linger of do as affected your

Paul Kusserow

we're seeing we've seen think so we're I Yes, about I what far. think encouraged

March. a have we of full caution put out so in PDGM think there to little note be I on will in

So, the to we'll start PDGM in impact of see full March.

we us there's where because, thought. I will us still be disruption people think more a up calling around my now I experience less I than there or remarks, more indicated will phone the some in as picking lot -- of and

that there And the then do a think us. disruption in affects of on level, versus certain fourth don't Home bringing a I Health, little on yes, heads care referrals CCH we still think but saw but I down, operations, is the and I be then execution on to our on it so, think was we're And And them. will degree. heads line we're, center PDGM integration that with still down both track and at around in legacy in the asset quarter. that

So, we about feel very good it.

Matt Larew

of into line, really and Okay. the give then for in absorption to patients logistics, absorbed some Just folks phone can a to you're of give of quickly can you sense full? taking, through opportunity center these these some walk time the bring is on right, just how us you you decide the these up following the us care sort calls you when And once greenlight? the

Paul Kusserow

so the we -- of about have key and some Yes, which overlap where I that will. States with is you XX% folks there's There's that's where coverage. buckets, where the this our licenses, three point one United think if at these is of we

the six unique don't Health, look in bring in The provider there there it. to thus thing employees believe do where good we absorption. bring would that can a called has can bring select business, we it's far, licenses. number we that's a and is the That's we Home liability in back And some that that with been overlap So, can we look way with year our just what have a some back.

provider our to outside license area the careful, look we for we're some then occur back. year have we of things go very and because a be when that liable so in that number, six acquire And

anything third higher CON other better there's a value tend people in bucket we're difficult and in CONs markets these them. CON Because seeing is do a state. interested The to in are pretty more bucket associated where with obviously a

buckets is one So, overlap looking where within know, at. obviously we're don't easiest there's The our area. three those are license I the Chris.

Chris Gerard

Yes, and to go little that when kind deeper we just we approached a hear patients that agency process of on that has financially base or of a struggling of an get and employees.

We all have make that of needing also care centers clinicians. to to team have the agency dedicated if there's opportunity the a an management our heart deployed a running balancing transition, against and toolkit we're project capacity, have we may sure that our out they're identifying there that to what evaluating

track XX% then that, a sign orders, process will experiences end admission a physician and based we locations absorb too agency that, at of the business. patient the will our assessment can to sample I and and and our for really into a choice, is actual them standards. to about on kind on have of a we move Home of is hiring our the choose it's fast say and qualifying the patients early up is that, of evaluation, matter Care, this that, patients We deploy if do

patients. the a redistribution not it's of full So,

Matt Larew

And more then if increasing you on one investments sneak in could there. Medalogix, some and the it's mentioned I just of you're

just the or incremental Or Is in looking you Medalogix? are more agencies? of for things Could what are strategies there tools a to tools prep. with work that sense terms PDGM for that from working apart just give the you're on? other think rolling you're out I

Chris Gerard

all a really which we tools care kind now. on We've a Yes, to kind products run through of really two XXXX, has is really then, late we're model our episode on care other We XXXX. focused optimization, of Touch, And expand those currently started of care in is deployment Medalogix in And products now, of them late or of of say got it's polyphase both I'd deployed XXXX. centers, both system. more to It's is in two centers. PDGM into really hospitalizations. around more which what

deployed have of We have we'll Touch plan done the by the the have organization a by I and believe. care end to end QX then of throughout QX,

So, with products. kind and it's training costs fees rollout really those of and more just associated

Paul Kusserow

I And for the idea PDGM. think is obviously, is essential that, Care

sure, discussions is Care we much that's very wants we make our the of that's go primary, Touch the Where us with So, hospital us Touch on very for reduction what Obviously, out. we're important, go Managed helped if Managed in have very in in often what Care. risk for put is But been pushed risk us hospital has at want as to reducing to results our product to been in re-admissions. strong place us. re-admissions and for and

Operator

you. Thank

comes line question from Our next with David with of the MacDonald SunTrust. Please proceed your question.

David MacDonald

in in the in MA construct terms on of providing? the anything that the you what and done capability the with be that plans have of that in is value terms based how place? would care, Paul, can potential quick now Just of changed conversation ClearCare you guys just services you that minute partnership a have of conversations spend additional kind

Paul Kusserow

the which key think and a two parts bang Yes, obviously, been, I happened real a to it. is, One that we've thing have is in -- building done, is enhancement. The approach. what big it's is conversations kind the there of network,

good seen. we working seeing seeing early what we And on since have doing still referrals. work we that some And by so largely doing results, on a it now, -- to encouraged that. Chris established was cross some, through we're largely that to it's But We're do we're feed we've emerged, of were we as all we're sudden the that. is there. need So, network,

fundamentally ClearCare Health the our with working build from individualized be we is Care, we going to And able fundamentally all piece information next The And been through to to the that what care that Home integrate our Personal at ClearCare, we're so care have have home best. planning. Hospice. optimize and have partners product together that based and care, to we the, home are and then, of is integrate with WellSky our that information obviously caregivers getting then we've then Medalogix we can which

to So, to a resources fundamental excited. seemed possible plan for lowest we're very of have about that the The cost. different variety excited idea to the be we very access really deliver good care can

the -- but is really talk so that's good. So that's,

the loosely I being kind assembled. are think pieces of all

enthusiasm Now, together. there But put a of have be seems all it. to we to it lot around

have having -- early We some conversation. we've some been good

David MacDonald

staffing importantly, give the shift? And, And that tool opportunity a number that an than can of a mix incremental a a little capacity the that? in you to little accelerate a it we've is the just there Medalogix talk about of better opportunity talked do bit Medalogix, I bit around know maybe about, place, opportunity does tools And potentially the likely with up? more to you little bit XX-XX kind frees

Chris Gerard

so I'll that answer one, Yes, Dave.

center visit, PTA at think sure our skill if to or patients, optimization making a out visit Medalogix, Obviously, don't level. does So, regards RN from with our I mix we it think an a care capacity to we're right providing per really going the it's an create really for I LPN. episode. visits our one reduction influences to like that PT the plays achieve do number to of be and data

of More think was getting biggest already accelerates coming that in we're of through And of to change we're last on out importantly, fundamentally barrier way did encouraged in were paid. our it of seeing pay change got the gate QX is the practice our top our it, practice kind the clinicians we optimized That in, them working at what that mix. I X,XXX year. license. change pay a the that their they had we And of really that

get to the it. us confidence feeling that, XX-XX. what Possibly but we're So, gives to good beyond about that's

David MacDonald

wrap at back the Is not that question, to Okay. an may that willing terms access Do the of think and bare to impact on more as to or some some little that I just with of you a reimbursement incentive kicks the of it may closely? struggle. issues. look could whatever government the of revisit I last of and up you government a and lot stuff here? that And look then you all would there's take look area think in cases, want the call the you mean, be risk a players changes and end bit counties in to some take care kind payment smaller in imagine

Chris Gerard

Dave. that's work of been trying dark I've CMS with question, to gone with since had good good -- CMS Yes, discussions kind us. this. I've they've on some a We been this, but trying on on early

I food at like some be deserts. point, think there'll

you're Health the some where I rap to you're think there in you, potentially places. the the will areas on rural plus, be I where, issues, you're add deserts, going getting plus some be could It's there Home the cuts. losing getting rural of be think particularly

to if At Obviously, the can consolidation facilitate CMS that see industry, this. CMS -- table. come to really wanted if if it they CMS in think like this back I point, seems we'll the do is which with

limit thing and smaller people players a by is, think the tried tried push players. coming they from out to is fraudulent particularly eliminating first lot the of rep I did in, fundamentally to

to But that want I that the we that's they foster pretty or that and of no there had to scrub go somewhat documentation have some you small paper idea scrub, is the in liabilities based scrub, and It's are suspect. consolidation players that and we were difficult. can if think imagine really

is about to deserts, these how to some figure So is, do least we've my I entice to they been dips, have And out have create and come bugging that back back hope to get at if really we if table to them if it they're this, going the people in have.

Operator

Thank you.

of Please question. proceed comes Capital question with from the Markets. RBC your line next Morgan Frank with Our

Frank Morgan

then place run going $XX fourth I around adjustments, would in fourth that might EBITDA guess quarter first rate about just to question, you question. you'd And that versus by million also out you items be as think quarter accelerating that's good taking -- and million affecting $XX as of be quarter the year. simple start the that I that's quarter next out, of commented maybe fourth guess XQ? the a EBITDA wanted how I it think be somewhere the 'XX. I I into nice growth the adjusted but called with to a first Scott is for just of

be implied sort what guidance Just XQ around as any XX? kind the you of exit rate would run of

Scott Ginn

answer and kind the that with yes. start numbers, I'll simple Frank. reiterate just of is think the but I

million, a as things good then year about good how rate in to through a last way of to to just CCH guide three thinking as the and of QX. $X over about you're fleet that's good QX is one I was guide. had about talks came this think lot we start was it QX and that And that as about fact we

X.X% from that then the the slower, eight two. that bps about that's of the of really XXX% another fact other be that's of it January, So, probably of rate, off piece will XX February about and initially, kind more there a little was kind overcoming

So that came from. that's where

So, you're to about million sequentially, last QX. seasonality, I QX about a that's good we thinking think $XX when grew year

days it a I the So, rate building from as the and other bps on start thinking in comes way good to to cost there, think about final that's levers through. then another XX

about that's think a it. and... And growth other way good I the around piece to think was

Chris Gerard

into Growth so as the Frank, be that's we Chris. expect, more it on, and be half we side. to guidance will out a that side is we year, total absorb. its out loaded bit It'll trajectory the we back go business or little emission on this of we from Yes, our -- of of think growth our, they forecasts that planned acceleration, did our any agencies, other bake kind not rescues and What to disruption into

happens of, that our that the half of on of we're expecting. already top that second trajectory the So, growth year kind be in any of can tacked

in business, our up heavily bit leadership we're end lines both part. as and staff a and investing on our of position into well a senior more and little running on and by year, QX. be of incremental investment the adding is which significant of level a This as kind BD They'll boarded

year, exit that going seem indications to be to a are So, we it's into pull-through of nice go expect all out in from but don't really the until later XX to as we XX. we as

Frank Morgan

that you say would What the…

Paul Kusserow

stop will sense moving Hospice goalposts in the very terms of the our point self-imposed in that looks this Hopefully, good. growth at

some the got I we're through got on the So, on think Home we'll X.X% also And in, then stability good starting side, gas we've some heading we're Health baskets, cooking be, then on deliver and to market there PDGM worked with side. having into. we heading and the cost

it. very about I So, feel think we good

Frank Morgan

will Is it fair that, the quarter year? of EBITDA highest quarter say the to fourth contribution for be the

Scott Ginn

correct. will in place I that. it assumption way built, really a good be That's for everything that's as The think

kind So higher of you're have still remember normal means our progression just EBITDA that on going health insurance. to

So, just of an of rate. get exit kind quarter it look, good would speaks that we how to a to if

Paul Kusserow

to is It's think that that, is going what this It's the in paradigm stick new people we're saying we're year. the of hockey a look. not And the think the best. to half going is going QX traditional way. that's I to a that be terms not how telling to going there's then, in follow in work I of second

Scott Ginn

visit. of per say it. is think per a piece a used a cost somewhere piece visit, Frank, about around about Yes, it add if of $XX the really -- what's it would cost is is thing think differential, where I on XX% fixed that modeling fixed we thinking, people certainly, We or are you other a around as cost

the So, is sorry, XX%, there. I'm inverse

So, is XX% fixed.

out will that. the we and per ROE cost like, visit, mates so about everything take especially math just our for thinking one through example, we it get could as visit, increase So, it the and increase staff -- and

So, It'll is some us the give year-over-year impact in from mind back to important raises. will what Scott, that that, of rates we in perspective. half it help overcome is us keep help as

Frank Morgan

PDGM of Just of but traditional on you've the they was from hop. episodic are that adjustment diem. business, Care to part you something a one payer about think And has lot what out reference maybe plans? just the to we've Managed I'll from the Care per that more Managed seeing and I converted talked Obviously, converted a, laid made to a

around PDGM? you. as So, side MA that the just color it any Thank whole, relates on to

Chris Gerard

Yes. Frank. It's again. Chris Hey,

a the members sunset were last year, last across on episodic -- latter had that product of part which us did we plan yes, patients with. So, offerings at volume the contracts question, payer an end -- have redistributed offerings significant Those with we of did other service they the that or year. had amongst their those were

a something big were actually as visit per Our to nice it go net we did make transition that versus in job the private for us But we'll as we rate. shift working our admissions a team was at through in economically. an But, neutral episodic Managed what forward. Care with our able it again, excellent payer that to admissions negotiate see

that's that we're contracts conversation And contemplated. contracts negotiation then we're these around is, almost were being having, has every a the gain some bigger picture are component or renewing having of share,

base not a we're only opportunity to when upside also our along we're with side with inching negotiated So, when that per getting on visit in the of produced. visit we terms in contract, per opportunity, some quality of regards getting the dealing rates we're

gives paid quick it that string. and plants see continuing on open incentives not leave we're trend get with we'd us dealing are but quality first and with and up we to So, we the quality sure to make at that the

the start string. we first So

that little to is we're Advantage get know So but to going excited. in down Medicare it's there, slow taking a penetration. us We while not

have good in able to a game very have We And to a partner. of play that. energy be we well that lot and be around

Paul Kusserow

share on Frank, quadruple just XX%. X% Advantage on our pieces Medicare year this up year to non-Medicare of at Yes, our is book. or following Chris's risk was It'll point, again last be

we share. doing but gain So, it's we hardly are more, are more and taking risk

believe as we're on to that's is no can, trying going. because involved we get future as where it. we But these as So, the many downside there's

Operator

Instructions] [Operator A.J. the Credit with of from line next Suisse. comes Our question Rice

A.J. Rice

Just 'XX. XXXX. to the asking have I your a about and cash expectations flow for

flow. XXX the roughly was obviously got where know of you cash to pointing payments day this also on flow that'll and business, but decline XXXX? free sort You any where of I cash growth operating think you're of the I think year. know for of X.X out but did the and a impacts you year comments there taxes, of cash in the flow directional a you cash where million DSOs will will the sustain higher RAP at not, or XXX come don't end be that the

Scott Ginn

flow us, think Sure. see in that about. as been from $XXX million, Thanks $XXX we'll disruption I talking kind range we've cash for of A.J. We're the looking you'll million a QX

of you'll it's RAP some of to we're away DSO, normal. we and you'll our the believe think and to then take somewhere build see range number a a stabilize again. hit from in get million and somewhat then us I to there progressed back $XX the cash names

heading we're year. of we're for into rest So, feeling about the good the where

deal on probably pay fund the as we'll now, small it So we at shape. portion we'll looking year-end. a left back of mean, to the that revolver majority great Asana it have QX I the we're We at right in think drew be in down QX. in

that think, cash well. QX flow XXXX for a story we is absent as still disruption, nice So

A.J. Rice

and usual Or still hospice to in many in pricing the light have and same And are change deals deal home of does yet? other of way Are on cases? on are the Okay, you few seeing I a wondered is already. that stepping that seeing obviously, even whether be any of then the done the a PDGM. the quick hospice also, players? since sane follow-up to competition? on is wonder Are up one in the And you've side in any health spillover the side? the I in deals you buyers you buy what tendency

Paul Kusserow

least that talk you in, that thus generally at seen seen we've So, it's on front. something We've far, free. if

is have people, So the that you generally you the idea patients certain conditions come. hire there some but

our license we're in pay but there interested I Is, people, don't Is wins. think expect competition? Yes. quality anything. again, think is the that it's when our we So I key in, to area,

licenses we to get get people The our about think fact working. do, Chris good how talked have very know a what that employees we I how to so to up, wins. playbook ability absorb wins, to

The though to still, are Scott much There's there. other everybody's and but to coming this. followed hospice. high. the assets, there's prices, now going They're about left the thing particularly side medium market they're more haven't prices not on so as out can talk sized with prices hospice the some the Unfortunately, market because

pretty but… a deals, it's decent tough we're still seeing So, for hospice, some market although

Scott Ginn

hospice and Paul Yes, we think Home we mean got think as absorption I on, health, frothy. Paul. earlier that's said has fair, opportunity. I pretty been

out that, larger I but available move definitely there, have PDGM that you'll are hospice for quality you of We'll some to this on because out vendors that the you if remains world. looking some move can lands expensive. players assets some but there have where think they're more see pricing

Operator

Thank you.

the from of with your line question with next comes Your Bank. Justin Bowers Deutsche proceed question. Please

Justin Bowers

quick during then, sounded cadence. call statements highest. XQ place, being if hour, we're I'm the but to going in the all wanted just I'll the XQ you're clarify keep top to the I'm just higher towards were running this And of the of everything's with of exit wanted the XQ. together and than it's some and just would or parsing like trying to be you some XQ saying, to be,

it be to in the a ramp the going year like of Is there's characterization? EBITDA. that terms a sounds throughout So just fair sequential

Scott Ginn

That's fair.

Paul Kusserow

fruition in a to that make come our on to full to, XX-XX is we to care implement we're the to -- to to we're of I we're LPNs that think going And we're our then savings because going full to way reduction. ratios to on going product, PTA need have to drive the that and get going QX.

see where you're going that's And the so margin expansion. to

Scott Ginn

Yes.

So, there. you things have that play two

everybody. remind Just to

miss up. kind then, about to build ADC, and come back in build start going off you it CCH, The we QX. if build exited lower, back dollars got cost QX think as up. that a that around was we ramping you start levers And incremental a we've most bit gets that you with QX, of leverage perspective, of got in, leverage there, PDGM the So, of the as and little revenue on you

we're of build So, you'll get year. that to be about. that full an see to rest for a million $XX as million going through ADC the $XX we That's benefit talking of

back the prop helping those, of both in have you that number half. up So,

Justin Bowers

There business the thinking profile as of some about year? as pieces forecasting. of digit in Is then on there of that we And you're double follow-up similarly accelerating growth terms in growth hospice to just healthy be kind well. -- quick is moving the throughout should well some

Paul Kusserow

in And sorry, if in again, that I you that is at, hospice mean, mind, Yes. CCH February. -- number look QX XX% coming keep what's growth. I'm just a showing admit in guide on into we're

in our they're So, metrics, that so guided number. in that's juicing same-store my growth rate

Operator

you. Thank

Our your Baird. next Gilmore question. comes the proceed question line with Please with Matthew from of

Matthew Gilmor

favorable, Medicare for performance tend Advantage coming though the margins again payment and which rate to your ask is but in about business growth non-Medicare expand you're be lower Home to wanted another booked able were paying rates still the I even the to up. Health there's margin

the there? So getting elsewhere? to Or players sort are better Medicare of efficient what's you able just going of you expecting? on are more what Advantage match sort resources with Are

Paul Kusserow

question. that love I

I so if that. think step you Medicare so, add there. back, you we're Advantage. board for we've color on And team the let I'll getting getting got that Chris, are run a increases you across the increases us, little bit to But

we you're more you you Medicare if efficient on getting and revenue took year-over-year prep our If the we move profile, look at visits. more as forward. then and there from look side, And overall up out of XX, X.X margin we're

a perspective both and So, cost through top-line slowing from a perspective. that's

add? So, that's helped to our don't want certainly there. you Chris, feed I to if margins know

Chris Gerard

as bringing us and the the up, able bit I the that little bit mix. to than inch our margin our we're mix clinicians is that's that kind it's of that terms year-over-year little as of more to better being Care lower as traditional being seeing a organizations, a how Yes. that and us around purposeful and we're optimized these visits so say kind from Medicare skill parts we're in getting rates of providing moving staff optimize Care would deploying and Managed to we're we're equal starting well sequentially we're

Paul Kusserow

Okay.

the we're I those though I to is, think answer take want and If it's to over questions, can it what be just think we're through the we question. still through hang even still is going who time. push continue going those to do will to for go on,

to is think we'll I almost beyond which extend time people the if have stay there on. are XX:XX, now, So

Operator

Thank you.

James. comes the Please with of Raymond line Our Cooper your from proceed question. Andrew next with question

Andrew Cooper

And overall XQ at admission guide. admit X%, I'll kind versus a at Thanks. and quick, Obviously, growth for be the of XXXX bit home think, just I better to health than at take kind you Medicare but in cut another out and versus XQ. the called or of X.X% little overall X% wanted flat

year Just comps. think other should And how kind that know just of pacing I kind way called we sort out BD of you that right any you reps we to why saw we're make sort other sure about bit first as lower? And we of than the through in that, But was of if as about mentioned have to for XXXX, XQ it that quarters why well? back about framed getting think the think overall? a you of sort little to and three what

Paul Kusserow

a prove-it-to-me So this is Chris? questions.

Chris Gerard

bit side. kind distorted does it little affecting much a and did a I total and Well, mean, of I the X.X% centers we we've or on on comp pay they're The PDGM think things Medicare the that that one were a a X.X% focus QX that on sure. lot for impacting X% our about the admin Yes, care pretty thing on of daily side talked have practice and internal of basis. growth

on staff. had execute in of our reps end number BD area one really referral is areas. fail sources. through we the FTEs, the And from it lingering us grew on QX And staff, on was our subsequent of there the we kind that were when that we out we did we growth was in all from of through QX, of effect that a had staff to just the calling BD grow focused years I not our We in that way more think our growth other of end quarters of What the QX. subsequent did

some had identified front We've that manager at the leadership We the down it. process. changes line slowed level hiring

to over coming XXXX. We're of in we've get leadership the the of gate to out heads incremental X% half. XXXX We're us about budgeted got in that line our of there really to I give BD close think a the add sight looking the plus lift number. mentioned a good addition XXXX, into second in should I

doing getting our purposeful we're is with we're now what just data. And more

We have a ton data. of

on we're different data we're it many claims ways. finding that spending we But a unnecessary lot have energy that waters. We break unproductive slice in of

we is some And getting through and that, So from purposeful more spending around productivity we're see what doing our increased opportunity reps. to we're how our expect time. incremental

X% good high a hit level confidence growth our I admit So in have our ability XXXX. and to

one Just time. more to in had kind admit quarter growth; the up X%; XXXX and in reps added just we added in we XXXX, total XXXX, of X%. and to first just XXXX, it of X% I reps XXXX. XXXX, frame mean, X%; we

So right on I the it. strategy still feel we've we execute got just like got to

Paul Kusserow

short to now, Yes. happen. is so reps, been with a think, one not going caught I be time, third we've thing And not going it's where where just dealt twice to it's Andrew, we've on other this we

So...

Andrew Cooper

that sort volume quick out long-term of of Okay. driven that as run absorption how X%, a opposed sort you Of to natural as rate, if much follow-up. of just And any? is then PDGM a would just sort of as call kind

Chris Gerard

in has PDGM it. That assumptions no

Paul Kusserow

Yes.

We have no…

Andrew Cooper

So and that, beyond any that above absorption admin would growth? be

Paul Kusserow

and what a but see we again, shakeout absorption XX% beyond. it's we XX%-ish roughly about are, would amount absorption be there could that out shakeout, we'll rough, rough significant XX% and the if overlap, above or there's XX,XXX significant levels and there's do, have assuming something a like X,XXX that. there's Any players, And of providers

which pointed are obviously really rest think significant frankly suitable. out it's what XX%, Chris is at folks that one it. looking there's the there. of out of not taking we've And been of out, XX% the I fight there. have maybe these is interesting, that we're is The business for to is, We'd So isn't things

the scrutiny interesting perspective, So are got you the when from through pass patients entirely. filter, it how that it's quite all the

Operator

you. Thank

question Joanna question. Bank Please of Our your the next of Gajuk America. with line with comes proceed from

Joanna Gajuk

in terms questions have asked. on lot so wholly we But in you there. in of A right, XXXX. were All some questions investments of continued see been comments of these two making

out on There's in million So investments $X resources. innovations. also PDGM you're calling

some disruption me, I to what up, next, the despite efforts like terms hospice the guess, CBC new sounds ramp of investments. So it finding PDGM from still making and thing with in you're in all

in the $X go talk PDGM, So what on exactly that? prepare to about expect as through or is can specifically you also you And to XXXX? discontinue implementation you the million, still spend,

Paul Kusserow

Medalogix. It's mainly

money an investment it's spent. that incremental, So well because and we consider it's

that is all other novo the is where three Scott are The the the the the fundamentally de is buckets has details. know ClearCare spending money. bucket we're the and I which one the we're those doing bucket, the growth don't other so

Scott Ginn

Yes.

the you've think to Chris resource PDGM alluded I captured piece, earlier. mean, as I

of So some There is putting of pieces place in but people, is small we're in a management-type you've and organization. got dollars, there incremental rollout the a touch little care ton across bit there. not

XXXX. that around to $X started at up So we since sitting those, look continue kind that's XX into end your novos of XXXX million number. we're we we There's de as

process. So feel good that we about

targeting XX-ish around kind some next got we've So year. of more for there

build processes. we're at. rest type that partnership, something other of looking you that's the innovation So then some people ClearCare And is but out running

So to on focused see teams play we Managed we're we we'll that look think add in to world. will forward, a we build bullish through our that. to look, But PDGM. as this the get business this be continue got XXXX important We've we we're and core in very Care and more think on resources going

Operator

You. Thank

Our proceed Matthew comes BMO Capital next of your the from with line Markets. with question. Please question Borsch

Eric Glynn

Matt. Eric Glynn on is This for

$XX line in million you attribute expansion, CCH say from the is more EBITDA the increase this driven the in it CCH at with guide million, margin looking you projected EBITDA would to top at XXXX $XX synergies? $XX business? growth million this Or XXXX would in is to Just

Scott Ginn

to as we've If think at a different differently, basically, course. have But more mean, of I We'll you a little if would say in hit were I but I little had look got it's would both. a answer mean, on I exited opportunity combination, growth. I we probably that we still from Natural, day that progression in get grows. if cost that, how we'll going through per you our is and fixed have that, rate as about a into you're some top run full we line think on in naturally margin synergies get costs there staff to

both. we We've they of did that deal, this in get looked about it four did So up. care important. to making adding sales because will job in folks company line was this it growing grow of have looked which said, we by we that, The three be census or got staff and will like a went lot a census areas. at investments back right what like but tremendous and to in years look, forth like we we ago, smaller centers, order very When a we by top about combination be talked we talked BD the

wise And folks. We we on was started of penny QX, missed in sales behind it helped but adding pound mark there. and foolish. but savings, the really off well probably kind we It were in us

to million really some grow as we'll That's to really that want numbers opportunities what going to higher there'll census and much plenty $XX levels. margin we're do. get get be forward that and we ADC. to back in So we these If heads of get opportunity, push

Paul Kusserow

point an acquisition we lot a really did from to of we it And expand one in Yes, ADC. suboptimal there's and ADC and of why get where a efficiencies reasons on the was to can perspective. start was you click your because have margin this

expansion to this we've ability core margin, our decent the grow see And to That's see in we operations. get so ADC seen that. we'll what natural margin a the up of as levels. And result then

Operator

Thank you.

Our with from final your line UBS. Mayo with comes question. Whit of the proceed Please question

Whit Mayo

feel preparation any kind of how any? choice just kind your the prep with about see and the balancing and contemplating you're curious, is or internal question just if And really the that? how for how you may with you're of around impact I'm you my review demo plan, that PDGM underwriting,

Chris Gerard

Yes.

chose right on we're obviously, not going it have we now there. Chicago. And in So,

process having virtually was basically first We're We three percent in on We're have It hold. before was very place same put that locations. use did rate time. running doing We the well. well. we it point XX is affirmation the something

Texas. The slated size, of be state We to that be into impact next will any Carolina one Florida. location out and is states state roll will North it there. size of us have Next that only will any in

an from better the feel you model. had on have investment this. incremental the are in of two locations good processing does perspective, affirmations. luck We individual with, a Number what very the of round how But It first a number processing MACs in a scalable at two, state. require is depending one, the size we've actually or little many bit we like have an

kind us, it's that kind a for we just see barrier any really now. of So not of for

Operator

no questions back over I'd turn time. are for further call There the at to closing you. to any Thank this Mr. like Kusserow remarks.

Paul Kusserow

I need the people on doing, employees, our Thanks, thank delivered who all to Michelle. And the and what I doing today, care the call want who results, again, who most. thank of year us everyone us this want taking you're to, joined great keep

our next day We hope quarterly our a earnings soon. that are and ever-evolving process call good talk on purposeful really and the you look everyone road has to and you work. updating On forward to out on

everybody. care, Take

Operator

concludes Thank today's teleconference. you. This

have and your at time. this You participation Thank for a may wonderful lines your day. you disconnect

Amedisys (AMED) 19 Feb 202019 Q4 Earnings call transcript