Enhabit’s Q4 2024: Unpacking Contradictions in Payor Innovation, Hospice Performance, and Medicare Pressures

These are the key contradictions discussed in Enhabit's latest 2024Q4 earnings call, specifically including: Payor Innovation Contracts and Growth Expectations, Hospice Segment Performance, Payer Innovation Contracts and Revenue Impact, Medicare Advantage Pressures on Business, Fee-for-Service Share and Market Dynamics, and Payer Innovation Contracts:



Home Health Segment Performance:
- Enhabit's home health segment saw total admissions growth of 1.8% year-over-year, despite replacing UnitedHealthcare volumes and managing hurricanes.
- The growth was driven by stabilizing Medicare fee-for-service admissions, increasing the percentage of home health visits in payor innovation contracts, and leveraging visit efficiency to increase clinical capacity.

Hospice Segment Growth:
- The hospice segment experienced average daily census growth of 8.6% year-over-year and 6.5% growth in total admissions.
- This growth was due to executing on strategies implemented in 2023, focusing on growing census, timely admissions, and providing top-quality care.

Financial Performance and Guidance:
- Consolidated net revenue was $258.2 million in Q4, with adjusted EBITDA at $25.1 million, up 2.4% sequentially.
- The improved financial performance was largely due to strong hospice segment performance and ongoing cost-saving measures.

Cost-Saving Initiatives:
- Enhabit is closing and consolidating branches, with an expected annualized impact of $1.5 million in adjusted EBITDA.
- The company is also outsourcing coding functions, projected to deliver $1.5 million in cost savings for the remainder of 2025.