Despite Turnover Increasing 25% In 2 Years, Pennant Sees Modest Home Health Growth

Pennant Group Inc. (Nasdaq: PNTG) leaders see a lot of room for improvement in 2023.

The company’s president and CEO, Brent Guerisoli, highlighted four key areas where it can measure that improvement: clinical outcomes, improved operating margins, organic and inorganic growth, and an elevated employee experience.

“While we are pleased with the progress, we know we can be much better and see tremendous opportunity to unlock additional value in the coming year,” Guerisoli said. “We are enhancing our efforts to find, train and develop world-class operational and clinical leaders. Our existing talented, local leaders — and many more who will join us — will drive improvement in these four key areas.”


The Eagle, Idaho-based Pennant is a holding company of independent operating subsidiaries. Under its umbrella, Pennant has 89 home health and hospice agencies and 49 senior living communities located throughout 14 states.

Pennant leaders struck a positive note on Friday, particularly when it came to its home health division. The company’s COO, John J. Gochnour, said that quality clinical outcomes and “robust accountability” continue to set Pennant apart in the marketplace.

“Our agencies reached an average CMS star rating of 4.3 and a real-time, 60-day hospitalization rate of 12.1%, which compares favorably to the national average of 14.7%,” Gochnour said. “These excellent clinical outcomes contributed to steady admissions growth, as home health admissions rose 8.2% and Medicare home health admissions rose 10.6%, each over the fourth quarter of 2021.”


Home health and hospice was at $90.7 million in the fourth quarter, a 16.4% year-over-year increase.

Despite the encouraging metrics, Gochnour said that over the last two years, elevated turnover levels and staffing shortages have impacted Pennant’s ability to grow.

“While the pandemic has created a role in staffing difficulties in turnover across many industries, we are ultimately responsible for creating a life-changing employee experience,” Gochnour said. “Our turnover results have not measured up to the highest standards we have set for ourselves.”

Over the last two years, Pennant’s turnover rate has ticked up by 25%.

The company has seen staffing numbers improve slightly in January, however. Wage inflation has slowed, clinical headcount has increased and home health and hospice turnover has also declined. However, that will be a point of emphasis moving forward, Gochnour said.

There also will be more acquisitions down the line for all of its divisions, according to the company.

“As we increase the quality and depth of our leadership pipeline, we expect to accelerate our growth,” Gochnour said. “We see a robust pipeline of acquisition opportunities in home health, hospice and senior living across our platform and in new markets.”

In 2022, Pennant reported $473.2 million in revenue, a 7.6% increase from 2021. In the fourth quarter, revenue was $124.7 million, an 11.5% increase year over year.

“These results reflect the success of our local operating teams responding to extraordinary inflation and labor shortages with consistency and resiliency,” Guerisoli said. “Our home health and hospice leaders continued to drive solid clinical and financial results, including improvement in average star ratings and hospitalizations, which contributed to double-digit top-line and bottom-line growth.”

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