Universal Health Services, Inc. (NYSE:UHS) Q1 2024 Earnings Call Transcript

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Joshua Raskin: Perfect. Thanks.

Operator: Thank you. [Operator Instructions] Our next question comes from the line of Andrew Mok of Barclays. Your line is now open.

Andrew Mok: Hi, good morning. I think you commented that the quarter was above your internal expectations. You’re expecting Behavioral volumes to improve from here, and there’s potential upside to initial forecast for supplemental payments. So, just putting all those together, any updated thoughts on where you think you sit within the unchanged guidance for the year? Thanks.

Steve Filton: Sure Andrew. I mean, clearly, just from a mathematical perspective, the amount that we exceeded our own internal budget and consensus numbers for the first quarter would already put us on the trajectory towards the high end of our guidance. I think most people know, but I’ll just repeat for everybody’s sake. We had never revised guidance after the first quarter. It’s just something that we don’t generally think is a kind of a prudent thing to do. I think if the trends continue, however in Q2, that’s certainly a possibility, guidance revision at the end of Q2 if these trends continue. Again, I think the trends that I would specifically highlight were better than we expected in Q1 of our acute care volumes, which I think we thought might moderate a little bit more than they actually did and Behavioral pricing, which I think we thought might moderate a little bit more than they did.

Obviously, we’re pleased that neither did we’re focused on keeping both of those metrics as high as they can be. But to me, that’s where we’ll watch most closely in Q2. If those metrics remain strong and steady in Q2, I think it’s much more likely that we’d have a guidance revision at that point in time.

Andrew Mok: Great. And then just a follow-up. I think you commented on intra-quarter and April volumes in the Acute segment. Just hoping you could do the same thing in the Behavioral segment and maybe comment on trends exiting the quarter to help support the higher growth outlook? Thanks.

Steve Filton: Yes, I think I forget if comments that I made were specifically about the Acute segment. But I think the trends more similar in both. I think I commented in some conferences earlier this quarter that the Behavioral business got off to a bit of a slow start with some bad weather in — bad winter weather in states that don’t necessarily usually expect had winter weather in the south central part of the country. But Behavioral volumes recovered in in late January and certainly February, but I think have the same calendar issues as the acute segment did in March, softer volumes, et cetera. particularly in that child and adolescent population, which tends to really soften when school is out. But yes, I mean I think I’d make the same comment.

I think we would expect to recover that softness if not in April, but then over the course of the second quarter. And I think Marc alluded to in his prepared comments that our general expectation at the beginning of year was that behavioral volumes would incrementally improve as the year went on and that’s still our expectation.

Andrew Mok: Great. Thank you.

Operator: Thank you. I’m showing no further questions at this time. I would now like to turn it back to Steve Filton for closing remarks.

Steve Filton: Yes. We’d just like to thank everybody for their time and look forward to speaking with everybody next quarter.

Operator: Thank you for your participation in today’s conference. This concludes the program. You may now disconnect.

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