Navigating Contradictions: Insights from the Latest Behavioral Health Earnings Call

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Financial Performance and Guidance:
- Acadia reported revenue of $770.5 million for Q1 2025, slightly above the midpoint of its outlook range of $765 million to $775 million.
- Adjusted EBITDA for the quarter was $134.2 million, near the high end of the outlook range of $130 million to $235 million.
- The company reaffirmed its full-year financial guidance ranges for both revenue and adjusted EBITDA.

Patient Volume and Bed Additions:
- Same facility patient days grew 2.2% in Q1 2025, including an unfavorable leap year impact of 110 basis points.
- Acadia added 378 new beds in Q1, including 90 beds to existing facilities and 288 beds from two new facilities.
- The company plans to add between 801,000 total beds for 2025 and expects to add between 608 beds annually over 2026 to 2028.

Operational and Quality Initiatives:
- Acadia emphasized its commitment to quality and safety, with measures like patient monitoring systems and mandatory de-escalation training.
- The company's integrated quality dashboard provides real-time visibility into over 50 key performance indicators, supporting its multilayered patient protection approach.
- These initiatives are part of Acadia's strategy to improve underlying labor trends and reduce premium pay, which declined on both a sequential and year-over-year basis in Q1.

Impact of Policy and Payer Rates:
- The company acknowledged the impact of government policy on its operations and expressed optimism about the continued support for its services.
- Acadia expects Medicaid supplemental payments to be flat to up $15 million for 2025 on a net basis, inclusive of the new Tennessee program.
- Payer rate updates have been cautious, with low single-digit same facility revenue per day growth expected for the full year.