Community Health Systems (CYH) Wells Fargo 20th Annual Healthcare Conference 2025 summary

Volume and revenue trends

• Softer than expected volume growth in 2024, especially in elective outpatient procedures, attributed to economic uncertainty and delayed rate cuts.

• Commercial volumes remain weak, while Medicare Advantage shows strength and Medicaid is slightly soft.

• Inpatient volumes are stronger, driven by non-deferrable care needs.

• Guidance for the year reflects continued softness, with adjusted admissions expected to be flat to slightly negative.

• June saw some improvement in consumer confidence and volumes, but guidance remains conservative.

Financial performance and guidance

• Full-year EBITDA midpoint lowered by $25 million due to $165 million in headwinds, partially offset by $140 million in Medicaid DPP tailwinds.

• Key levers for improvement include volume and payer mix, with Medicare rate increases expected to help in Q4.

• Labor costs are stable at 3.5–4%, with contract labor normalized post-COVID.

• Outsourced medical specialty fees, especially anesthesiology and radiology, remain a challenge but are being mitigated through insourcing and technology.

Operational initiatives and cost management

• Insourcing of ED and hospitalist groups has improved patient and physician experience and quality.

• Ongoing cost savings initiatives are focused on normal course efficiencies, with further benefits expected from a new ERP system.

• Project Empower technology implementation is complete, enabling supply chain insights and contract leverage.

• Additional value from Project Empower expected over the next two years as legacy systems are phased out.