Amedisys Inc. (Nasdaq: AMED) was able to grow in 2020 amid unprecedented turmoil. Its executives are now bullish on where the company stands among its peers at the back half of the COVID-19 crisis.
To keep the momentum going, too, Amedsys is investing significant energy and focus into improving staffing moving forward.
“We generally try to avoid hyperbole,” Amedisys CEO Paul Kusserow said on Thursday during the company’s Q4 earnings call. “But considering all of the challenges that 2020 threw our way, our performance has been nothing short of spectacular.”
Baton Rouge, Louisiana-based Amedisys delivers home health, hospice and personal care services to about 415,000 patients per year. It has 514 care locations in 39 states and Washington, D.C.
The company’s Q4 net service revenue totaled $550.7 million in 2020, a 10% increase compared to $500.7 during the same quarter in the previous year. Overall, Amedisys’ net service revenues totaled $2.07 billion in all of 2020, an increase of over 5% compared to $1.96 billion in 2019.
The revenue breakdown in Q4 included $329.4 million from home health, $203.9 million from hospice and $17.4 million from personal care services. While revenue increased significantly in the home health and hospice segments year over year, personal care services revenue fell slightly.
In 2021, the company expects to continue growing as government relief subsides for agencies across the country that could be in trouble.
“As the unsustainable subsidies subside,” Kusserow said. “We expect to capture more and more market share over the coming years as we roll up our respective industries.”
Amedisys is also confident that it can gain an even larger share of business from other post-acute care providers thanks to the fallout from COVID-19.
“COVID is accelerating trends of doing more in the home, and no one is better positioned than Amedisys to take advantage of the shared shift into the home,” Kusserow said. “And as we grow our SNF-at-home capabilities, technology innovations and other high acuity programs, we expect to take even more share from other post-acute providers.”
Facing staffing issues head on
Amedisys is still dealing with COVID-19-related staffing troubles. Mandatory quarantine periods have been throwing the scheduling process for a loop ever since a COVID-19 infection peak in December.
“Quarantines certainly have an impact on us, and we did see some harm in the quarantining of clinicians in Q4 as COVID cases rose,” Amedisys CFO and Executive VP Scott Ginn said. “We think we peaked at the end of the end of December. So that certainly is working its way down, but it’ll be a slow drop.”
The company said that 40% of its clinicians are now vaccinated, which should go a long way to curb quarantine-related time off, as will COVID-19 cases dropping off overall.
At the beginning of January, the seven-day rolling average of new daily COVID-19 cases in the U.S. was close to 260,000. Now, that number has dipped down to less than 70,000 cases per day, according to New York Times data.
Amedisys’ turnover rate in 2020 was 18.3%, which marked good progress for the company, especially during a turbulent year, Amedisys COO and President Chris Gerard said.
“In a year in which numerous unforeseen challenges impacted our daily lives and work lives, I’m very proud of the progress we made in supporting and retaining our talent,” Gerard said. “We made good progress, but we still have work to do, especially within our clinical staff. Reducing nursing turnover is a key initiative for us in 2021.”
In order to help retain talent and drive that turnover rate down even further, Amedisys has implemented a predictive staffing model that aims to foresee when a clinician or caregiver may be leaving before they do.
While the model is new, it has been reliable since its advent.
“We’ve developed a very good predictive model, which can basically tell when we’re going to lose people, between 60 and 90 days ahead of the time,” Kusserow said. “So we’re being very proactive now about [using] this model to drive down turnover, and we’ve seen some very good early results.”
The company believes that its growth in Q4 could have been even better if it had a greater clinical capacity.
“Because it was coming so fast, and we were fighting quarantine with our clinicians and utilizing contract nurses, we know we could have done a little bit better,” Gerard said. “So really it opened our eyes to making sure that we’re building out this clinical capacity this year, making sure the back door is shut in terms of any nurses choosing to leave the organization.”
During the call, Amedisys appeared to be self aware about its staffing situation. Although its turnover numbers weren’t poor, per se, a better staffing effort could have helped yield greater growth for the company in Q4 and 2020 overall.
As the company realizes the amount of opportunities that lie ahead, it wants to be ready to take advantage of them. That will require a shored up workforce, executives believe.
“We’re just people. We have no real assets.and therefore, the assets are people,” Kusserow said. “And we have to have incredible understanding, particularly when there is more burnout and when there is a shortage of clinicians. So we feel very good about where we are, but we’re going to continue to really drive in the vanguard of understanding how to predict labor utilization, how to predict burnout and how to predict turnover.”
Both Gerard and Ginn were both recently granted promotions, Amedisys announced Wednesday. Gerard’s title is now president and COO, while Ginn’s is now CFO and executive vice president.
Kusserow continues his role as chairman of the Amedisys board and CEO.