Ardent Health (ARDT) investor relations material

Performance highlights and challenges in 2025

• Achieved strong growth in admissions, surgeries, and ER visits, with leading market share in most markets.

• Margin expansion was modest but positive, supported by outpatient acquisitions and a new chief development officer.

• Faced persistent payer headwinds, especially denials and underpayments, and adverse malpractice claims in New Mexico.

• IMPACT programs drove operational improvements, focusing on margin, agility, and care transformation.

• Entering 2026, focus remains on labor performance and selective outpatient growth.

Financial outlook and headwinds for 2026

• Core growth rate set at 4%, with a $35 million headwind from loss of exchange subsidies.

• Assumes 20% loss of HIX enrollment, with 10-15% shifting to commercial and the rest to self-pay, and a 30% utilization drop.

• 2025 EBITDA was $545 million; 2026 guidance midpoint is $510 million, reflecting $50 million in payer/pro fee headwinds and $18-20 million in restored incentives.

• IMPACT initiatives expected to contribute $55 million in margin enhancements, with $20 million from core growth.

• Expects return to EBITDA growth in 2027 as payer/pro fee pressures normalize.

Actions on professional fees and payer denials

• Radiology subsidies became a new headwind, with contract stabilization now largely achieved.

• Forecasts high single-digit inflation in professional fees for 2026, but expects moderation from prior years.

• Addressing denials through expanded appeals, process standardization, improved coordination, and contract changes.

• Cautiously optimistic about early signs of improvement in denials, but too soon to confirm.