Amedisys Inc. (Nasdaq: AMED) has become “obsessive on retention” and the larger impact staffing could have on the company.
“We feel like the most impactful lever in our organization is retaining our clinical staff,” Chris Gerard, president and COO of Amedisys, said Thursday at the Barclays Global Healthcare Conference. “We live and breathe, every single day, to make sure that we have clinical capacity.”
Amedisys delivers a number of offerings including home health, hospice, personal care and high-acuity care services. The company’s footprint includes 350 care centers in 34 states and the District of Columbia, with an average daily census of about 74,000 patients.
Amedisys’ laser focus on retaining staff resulted in the company driving down turnover by 9% last year.
One of its keys to success in this area has been its turnover-prediction tool, according to Gerard.
“We run it through every one of our employees once a month,” he said. “It tells us — with an 85% rate of accuracy — if somebody is planning to leave in the next eight weeks. It gives us the reasons why, and allows us to interact and engage in proactive conversations with them to be able to find ways to keep that from happening.”
The company is also keeping an eye on pay differential relative to other opportunities in health care.
“We saw just the payment gap, in terms of taking a traveling nurse gig versus home health or hospice nurse,” Gerard said. “It seems like it peaked in January, February. It’s coming down, starting to moderate. I think that’s directly tied to the pandemic and Omicron.”
This year, Amedisys continues to make lowering turnover a priority.
“We built turnover into our incentive plans, from the clinical leadership at the local level, all the way up to the C-suite,” Gerard said.
On the recruitment side of the staffing coin, new applicants are still difficult to pin down.
“I think it’s pretty obvious why, when you think about the pandemic and about nurse burnout,” Gerard said. “A lot of nurses are looking to go over to gig work for a bit. We think some of the nurses who have taken some breaks relative to burnout and the pandemic will eventually come back to the workforce.”
Gerard noted that over the last year and a half, Amedisys’ yield — meaning the company’s hires relative to its applicants — has increased by roughly 33%.
Room to grow
It has been a busy week for home-based care giant Amedisys. On Wednesday, the company also presented at Oppenheimer’s 32nd Annual Healthcare Conference.
During the presentation, the company touched on its margin targets of 13% to 15%.
“A lot of it is continued good reimbursement,” Scott Ginn, executive vice president and CFO of Amedisys, said. “We are having to deal with the offset of sequestration. We do see a good line of sight on some good reimbursement going forward. That will certainly help us.”
Ginn also noted that Amedisys has four hospice acquisitions that have not yet reached full maturity in regard to average daily census (ADC).
On the home health side of the business, Amedisys continues to see high demand for services. But it’s often a challenge to keep up.
“We’re seeing the demand come through, in terms of the incoming referrals for our business,” Gerard said at the Oppenheimer event. “We still have geographic pockets where we are incredibly strained from a labor capacity perspective, or the volumes coming out are so fast it’s tough to actually grow our clinical capacity to take on that volume.”
This reality underscores why the company has been especially bullish when it comes to retention and recruitment.
Going forward, Gerard is looking to lean into the opportunities offering higher-acuity care in the home will bring to Amedisys.
“When you think about five or 10 years down the road, as Medicare Advantage penetration continues to dominate, that’s going to be who we are predominantly working with as a payer for our services,” he said. “Having those capabilities in the home, … that’s going put us in a position, with plans, where we are able to negotiate and have either capitated or full-risk arrangements.”
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