Enhabit (EHAB) Goldman Sachs 45th Annual Global Healthcare Conference summary

Strategic priorities and business outlook

• Focused on stabilizing Medicare Fee-for-Service mix and growing home health through increased clinician hiring and expanded payer contracts for 2024.

• Hospice strategy shifted from stabilizing clinical capacity to business development, aiming for census growth and operating leverage.

• De novo expansion continues, with a goal of 10 new locations annually, emphasizing co-location of hospice and home health.

• People strategy has improved employee engagement, with a top 25% Net Promoter Score in healthcare.

• Long-term outlook supported by demographic trends and a 5% CAGR in the addressable aging population market.

Payer Innovation and contract strategy

• Payer Innovation contracts have grown from 6% to 38% of non-Medicare visits YoY, boosting non-Medicare revenue per visit from $136 to $145.

• Admissions in better-paying contracts increased from 58% to 71% YoY; 64 new contracts signed since the spin, with 30 more in the pipeline.

• Ongoing renegotiations with national and regional payers, aiming to reduce administrative burden and focus on high-quality, well-compensated contracts.

• Sales team incentives are tiered by contract quality, with Medicare Fee-for-Service and some regional agreements in the top tier.

• Goal is to simplify referral acceptance by broadening contract coverage within the next year.

Operational efficiency and labor initiatives

• Recruitment and retention improved, with a 30% increase in nursing candidates in Q1 and focus on better onboarding and candidate selection.

• Technology tools like Medalogix Pulse and Muse optimize care plans and resource allocation, enhancing clinical efficiency.

• Most clinicians are salaried, with efforts to maximize productivity and optimize staff mix (RNs and LPNs).

• Home office costs stabilized at $27–$28 million per quarter post-TSA, with standalone costs lower than initial projections.