Enhabit, Inc. (NYSE:EHAB) Q4 2022 Earnings Call Transcript

Crissy Carlisle: Yeah. So, Andrew, we don’t give that level of detail in our guidance considerations. It’s — again, it’s a balance between the growth that we see in our markets and the shift to more Medicare Advantage in addition to our strategy to also use those Medicare Advantage contracts as a way to get more traditional Medicare fee-for-service back from our referral sources. So, we just — we don’t go into that level of detail because if I tell you one factor, and it comes in slightly different, but we still make guidance, we usually get deemed on that. So, we’re not going to go into that level of detail.

Andrew Mok: Got it. Okay. Maybe just a follow-up on standalone company costs. You quoted a year-over-year increase in the deck of $9 million to $10 million, but hoping you could give us the absolute dollar figure of standalone costs in 2023 versus 2021? And how that compares to your initial projections? Thanks.

Barb Jacobsmeyer: Yeah. So, I would think that 2023 is probably going to be in that $26 million to $27 million range. Again, it’s going to be — it’s got the TSA in there, the TSA is going to rolloff as — in response to Brian’s question, so by the time we get to the back half of the year, you should be at somewhere in that more normalized run rate of the ultimate $26 million to $28 million, but I think given some of those ramp ups in 2023, you’re probably talking about a $26 million to $27 million range.

Andrew Mok: Got it. Thank you.

Operator: The next question is from Joanna Gajuk with Bank of America. Your line is open.

Joanna Gajuk: Hi. Thank you. So, just a couple of follow-ups. So, you mentioned that you do not, I guess, provide for deal spending. So, am I reading correctly you kind of saying you don’t assume acquisition — incremental acquisition in your 2023 guidance, correct?

Barb Jacobsmeyer: That’s correct. So, the opening of de novos, Joanna, is included in that guidance. And then the — of course, obviously, the acquisitions that we did in the fourth quarter of 2022 — remember that we completed $36 million of acquisitions in that quarter, they are in the number, but there’s nothing specific to acquisitions within the 2023 guidance at this time.

Joanna Gajuk: Okay. And the other follow-up. So, there was a question on visits per episode, I guess, it’s declined to 14% in this quarter. And it sounds like you maybe are thinking that could go even lower because I guess you’re rolling out post to additional markets. So, is that the way to think about it like some 14% lower or are you talking about more how things kind of came in on average for the year? Kind of just asking, is this a sustainable number — the 14.3% per episode and I guess how low can you go really before you start impact quality?