HCA Healthcare (HCA) 23 Jul 242024 Q2 Earnings call transcript

Welcome to the HCA Healthcare Second Quarter 2024 Earnings Conference Call. Today's call is being recorded. At this time, for opening remarks and introductions, I would like to turn the call over to Vice President of Investor Relations, Mr. Frank Morgan. Please go ahead, sir.

to today's welcome and morning, everyone call. on Good our Hazen; and me this CFO, Sam is morning With our CEO, Mike Marks. will questions. Sam we'll Mike provide remarks, prepared and and take some some then

Sam, Before the factors should call Numerous on are any I contain may be results risks, based remind statements statements are expressed current call to materially SEC today's that in that factors turn forward-looking management's everyone today. let over uncertainties and that me information expectations. other differ from various cause to release might actual press forward-looking More on these our and and listed today's those in filings.

information call, of today. attributable This EBITDA, may non-GAAP and morning's A included a HCA on this measures such recorded, a and replay supplemental the is will release. available measure. we reconciling call net adjusted which morning's to in EBITDA income is call as adjusted later today's financial be being On providing is reference table

that, the With call Sam. I'll over to turn now

right. good for Frank, and services. everyone. strong positive were demand to and the reflected across morning you, second quarter results for the company's our The All Thank board

innovate their patients, our work in and positive our and execute In outcomes deliver I outstanding continued continue want our enhancing and management. to our case on HCA also strategic effectively for for and our plan teams addition, facilities, colleagues to including throughput mission. our while -- produced better thank pursuits to their

service volume past emergency same lower categories, were in growth rehab self-pay other quarter, and across admissions and quarter, equivalent to saw procedures the mostly volume As categories. Similar earnings by down grew markets share visits inpatient X.X%, second to increased the X.X%, surgery strong the quarter, the $X.XX. room were and compared inpatient grew per XX% services up like explained few in adjusted Consistent as X% the declines with Medicaid lines. volumes first the we surgeries experienced facilities cases including to increased first admissions outpatient quarters, inpatient diluted cardiac growth. a prior broad-based X.X%, basis On our year, were X.X%, and

year-over-year Payer And commercial factors our growth our compared increased These XX.X% as of slightly of revenue the services inpatient case admissions. of lastly, to in acuity last equivalent reflected -- improved same-facility mix representing helped with index volumes XX%. as generate year.

quarter, Also progressed further agenda our produced in we on cost and solid operating the margins.

people the disciplined encouraged produce are to will transition our we last we company's we believe for the results. making As in XXXX, and by our We investments along outcomes of continue facilities stakeholders. with are the positive increased to our operations half --

as for our year, In guidance of updated we for performance strong remainder the closing, our of we press release. year, that in the year-to-date the demand our given backdrop and have forecast the indicated

With call that, Mike me turn let over the to for more details.

and everyone. Sam, morning, you, good Thank

quarter solid costs performance demand, second so cover results, Sam continued reviewed capital. top and will in I line showed a improved balanced The of margins operating quarter. allocation the our with strong

basis represented points percent of in year. XX.X% the a basis points improved as continue XXX prior which the through contract costs. from results cost well Labor first from prior year. in to total prior the the of and good see labor, labor basis to from XXX quarter. a costs And were improved margin declined year and of resulting costs year Supply revenues Operating X.X% we points XX improvement prior managed, sequentially has

prior compared of it to relatively On other consistent they the year, the revenue, costs grow as operating for did quarters. a past but remained percent X

compares the the favorably to experienced XX% moderated first second which that fee encouraged professional were approximately in quarter, quarter. increase year-over-year same-facility in We the growth to costs XX% we

included and a was XX% the prior in a modest supplemental billion Medicaid $X.XX represents which quarter, over from EBITDA benefit Adjusted year increase payments. the

management of performance the a company. are very team, operational As the with pleased we

moving allocation. to capital Now

capital by supplemental payments expenditures tax and and creation. of receipts. deploy which prior to billion, outstanding billion year, strategy we long-term $X.XX timing is income program driven million for and continue the of $X accruals value balanced the $XXX Cash in a flow was a decline in the Medicaid quarter. of our repurchased of We quarter, allocating just from billion $X.XX totaled in cash under operations Capital share

$XXX We dividends. in million about also paid

guidance Our debt-to-adjusted are EBITDA perspective. end balance near positioned well from we range, and leverage believe stated low of we sheet remains the our a

release our in we Finally, morning, this estimated XXXX. for guidance updating are

share. $XX.XX EBITDA, net $XX.XX range is Healthcare, $X.XXX billion $XX.XX earnings billion per on $XX.XX HCA and that conditions. to $X.XXX Based guidance attributable $X year-to-date $XX.XX strength estimate outlook, billion revised will $XX.XX diluted billion; to be XXXX, to billion; our repurchases the results to around new in share our of per share, subject our income market revenues, adjusted billion to to For billion; and we

over the turn for call questions I'll answers. and you, Frank, that, to With

[Operator to you Mike. now give those Instructions] you, who Ellie, a instructions ask to like Thank would may question.

from Instructions] first [Operator question A.J. from comes UBS. Our Rice

areas focused two And expectations? relative Tennessee. on, for payments. Maybe you supplemental that your How are in back your including very to anything just running half comments, people is that are

growth is is how trend strong these then public being that other And much for what there And the area the in the helping results? exchanges, year-to-year?

take I'll question. Thank the Mike. is you, this A.J., supplemental

think been Medicaid Medicaid the without for aware, below you're of cost significantly most historically patients our than challenging payer, really paying patients. typically carrying has I us as insurances, other

it to together discussing programs most them put in short complex, Medicaid from of these Medicaid with we still historical implemented states are the Over important And They the or have to this are growing, their years, is it We several enhanced operate context. can understand supplemental to well be backdrop through quarter-to-quarter treat in programs. in Medicaid important reimbursement while reimbursement when impact variable when last and these taken covering believe programs. cost patients. is which supplemental payment

began to payment programs second we program, the by the of in $XXX primarily and of quarter, which In program new recognized accrual the quarter our a the quarter. million supplemental increase earnings XXXX. the fourth of to now in Nevada the Medicaid year-over-year driven But related Florida approximately

about To and your not program -- do review, financial we with the from specific is in that anticipate XXXX. we program new that Tennessee, in impact CMS question for

public to you exchanges. to go want If the

For up But quarter. the care, quarter health quarter, volumes kind our commercial for let me kind versus just managed first and equivalent of general the in break we'll give it. prior then admissions exchange this including and care were XX.X% in out year volumes of our

If they health equivalent the prior just X% on we short up you care up of exchanges, XX% exchanges, over for without care health were take And were for quarter. year our managed care volumes admissions.

Okay.

I So by and think Medicare X.X%. to there, Mike the I as I on volume, our were I up, mean volumes mentioned think alluded

the So the across relatively Clearly, so bigger comparison has categories. business become classes the was only all payer small but think of or being really a I and all category supported the exchange nonetheless, the payer in enrollment But the that classes. see across with years to the good was Medicaid, X volume component other volume over still we did last payer the down.

admissions, down mostly were related Medicaid redeterminations. Medicaid equivalent XX% to And on

comes Ann Hynes question from from next Securities. Our Mizuho

down that that, labor that percentage labor on things by quarter was can just about us contract be like if you and just any And contract total labor, flat. --? temporary sequentially, would driven talk give SWB, We it's great. it usually Is details

XX.X% labor Ann. was this Thanks, Contract prior versus Sure. quarter quarter. down year

height the I in noted the a early I'm second compares of -- X.X% percentage in almost This of to quarter was opening at percentage contract in my last in as of and As XXXX. comments, COVID quarter. revenue of year the labor at SWB sorry, XX% X.X%

So labor. that's the the improvements and we're in continuing contract all see doing the recruiting work to around retention, around dividends from and paying we're

about inflation, of of it run stable and wage run. think where kind we you wage If was to continues to expected inflation kind

for our the we also quarter. are pleased So with results later

from seasonally, quarter bit the that the because we our to drop the consumed of the improve end second of payments. the we are of of the by quarter that do to the or and simply have metrics And in of part the those absorb because quarter, to some of quarter a tends first first payroll early quarter to little taxes second tend tax the timing

comes from Bank. from question Chickering next Our Deutsche Pito

us of changes to from bridge What half coming percent back the acuity? raise coming to or is EBITDA the And guidance? And is this mix any you're percent the half year? upside for you just labor? versus coming year from changing What for coming pricing of then to from how is Can just margin better volumes? from original there better then back supplemental the assumptions are improvement changes finally,

year. So of back sets we're with half kind due year-to-date performance. pleased really thinking the about our the our obviously of It

this of and On payer the the than for year original better first months top expectations. our our mix were volume X line,

contract talked to results. thinking labor about, labor also declines our we as of management, the Solid the just contributed our kind including around

we move growth year, As the anticipate to continue. year. half trends to We the back volume be range of should we believe in X% most the for of into the X% these

in salary projected wages did back the as expect in of do range where the to wage labor is XXXX other moderate and of XXXX. prior benefits fee we roughly to well. in of to half run half as the salary benefits year as expense expect revenue the of and and percentage to supplies expenses We percent operating a more growth be bit in a mid-X% we June professional And back mostly Contract a year-to-date.

programs. on original in Medicaid million we supplemental million headwind guidance, to anticipate from you payments, a our supplemental Specifically $XXX Medicaid $XXX recall as the of

quarter-to-quarter. an programs of we've and first million most lot visibility in we from deeper into anticipate XXXX Medicaid are As better complex our supplemental $XXX approximate programs, we states, across payment a have of the of occurred But these half in variability into are the noted $XXX previously, which now have to given programs XXXX. XXXX and tailwind now million that

Our next from Jefferies. Tanquilut Brian question from comes

bit with Sam, we -- just you Congrats in out about very still very, think on Medicaid good quarter. But performance. as the little volumes solid Maybe, kind redetermination a of dragging here. called

this the as trend. So stand curious where elevated you just now sustainability think utilization you about of

mentioned, Mike that as XXXX. trends -- growth. we have for really do throughout volume solid volume just had expect we including these will Well, And continue Brian, XXXX,

markets we when look at company I up for overall it we our and serve. services, pull we for and the the volume demand starts with that think

at indicated we we We as solid Investor That's the are are have first thing. our support to organic markets, going growth. Day, that think characteristics in that

way. we HCA The how second thing And is we build our how that. that network network, execute of inside is the

that our capacity in really year-over-year. bed small that well, of we've When a facilities, as complementary. inpatient at look ones Our added all across is you up are few X% hospitals

facilities overall up outpatient are Our X%.

have grown, And So growth. be ability it's market key share, part to our our that share we and part market we to we to and network of a our our development continues our to think parcel suggest continue which grow metrics see is positive.

third for is us capital. The thing

in our better heavily outcomes are who use We're services finding investing investing investing produce technology we better We clinical make investing our network. in our to for our in to We're and physicians. people. And in patients. ways capital are. for our our we're We're

somewhere of capital. our organization this which significantly over So we $X.X years, of up see couple and is to billion, invest invest year, we'll inside continue last to around the opportunities

exchanges The through us to through that their whether next know purchase services. employers, area, believe we tend hard when they Medicare, it's this, people mostly, -- are the coverage do to covered but for it's through

coverage so is And up.

it's in coverage And a believe fundamental from mentioned as helps but a demand really So forth, calls to demand. we've we in know hard unchartered are of in if elevate the attributes And there's and so support hangover in help for growth. territories normal COVID, do past environment. demand that we growth

the the broad-based obstetrics across looking like earlier, start slightly said It's payers. in across up broad-based. across broad-based you our I when different was mean classes, then It's different services. we it's And payer the even quarter.

see just sort HCA this we of allows market we're of balance this growth, year-to-date business. year. across of again, in encouraged as diversification what aspects service to what by and the all seen lift us market And the have from and of well diversification a we the pretty over we demand expect participate to from So our as

Our Hendrix next Ben question Markets. comes from RBC from Capital

of that higher I could out you two you see midnight strength acuity parse -- was rule acuity acuity comment that pull-through higher there's heard investments Medicaid on more and of MCOs pull members wondering like maybe maybe little continue and continuing and forward capabilities a the off. redetermined even book bit the if then about between or we some to if talk ahead sources some of -- acuity being

that seeing where wanted So of I just indication get you're to acuity kind any growth. of

this Sam. Well, is

our need And that, stock happens And of strategy. ability to by our I strategy a patient's of our speak within the care mean, me Let one of sort core to their what a is core condition to take to systems. create be. regardless capability

have services time, the complexity in So offered. we, over built that we've

we've with which ground enhanced there, care health enhanced We've in typically services. enhanced be the So programs. helicopters, more up that centers We've interacted needs not. community programs. our than neonatal with acute a with to way transplant our care rural with service infrastructure We've transportation. tends trauma opened requirements support transfer We've

so And has been our that the over years. network toward all and parcel part of strategy

in care. I our we occurred ambulance trauma again, will growth at you, in of the cardiac broad-based deliveries tell number that hospitals, had service our

surgery cardiac was up. Our

up. neonatal -- had we So admissions were

to saw All our of network strategy are these that components growth. that I essential mentioned

to rule acuity dilutive the comes patients midnight is of so case has mix lifted side. we that two the And actually the mix and it serve. The that our on when inpatient the naturally case

of over an jumped the rules to average status, deserving those lower implications equity the we comparison. none patients because acute but two deserve inpatient midnight be the So less by -- are in than

the dilutive effect is more even So than complexity our what the because two of suggests the acuity quarter the out the reports of we and simply midnight that of services offer it rule. that

from comes Justin next Our question Research. of Lake Wolfe

analysis to wanted run Sam, is heading and move And from of payer terms you economics become patients into the happens getting they exchanges? the just happens you share other these expire your Has disruption if from with who what XXXX. maybe be drop scenario Do of on the at could to a subsidies allowed all of bigger us view which those Do those might think volumes enhanced should company you the to questions of expire? subsidies get election, investors they not, the what the hospital end types? to think uninsured? exchange one for the potential should in we're to coverage,

just Can us was could growth I if in ASC squeeze what question. a numbers then quarter? revenue the And same-store you tell in

out now obviously, On the here play politically and Justin exchanges, the there's to year. of lot a the end between

they available. respect to the obviously, So that we what's you've us secret little at a are the to it's all politically many for to And happen that data are It's of the no of end going to exchanges. forecast seen serve, in premature in scheduled the with participants XXXX. that expire states that's

which of great know difficult subsidies a have don't We on precisely what that will the how in exchange line play level is. at of It's what and sight participants out. really to for that us

try that in exposure have of too to at feel possibly we we policies study. once early this around some any if it's appropriately. we way sense point We that. in the for But of as time, go the starting on support are and information it with put transparent might we're we share that subsidies economics make forth all as can better you study be can us much judgments But the be hopeful as around And be will we have that sense a away. we'll -- the to XXXX,

On ASC revenue is about same-store growth X%.

from question next Partners. comes Leerink Our from Mayo Whit

in talked any And stay? comment and you've Sam, the the can length that productivity in perspective, lot in ER. quarters maybe quarter. this in Any of throughput puts this recent see on the numbers had commercial of growth the just around end a with around back the gains initiatives on that could the you you've share you those we it that if ER efficiencies

Okay.

ER commercial with start the growth. me Let

emergency the almost Our commercial volumes in grew XX%.

growth our we revitalization ER ER performance on in with what high positive program produced revitalization category. us. and call patient results for And focused that our Again, strong really program. has throughput, So clinical are we satisfaction

X let's to X the didn't patient, throughput, with to a we're much. time Our is that moving Well, like see start down minutes. minutes. XX point. That starting sound That's from

or out. to around then something Our communicating have XXX I the and length the they're discharged them XX% through think, to systems, when getting minutes effectively XX% be zone. them who patient is for with ready stay patients Again, out of throughput, been that to down, in getting about

patients admitted. Then have are we who

For can a those also up in improved hold a markedly patients, proper them also floor get setting a we room, basis. year-over-year to has improved on so time in for care. And the emergency the and that we've

We leadership help different about continuing them to invest have our room development. in innovation we're to to in of go. continuing approaches. our And care processes inside to our invest We're ER transformation We put and think technology. team

has patients improved recommend emergency or our emergency room. And room. say XX recommend over of satisfaction I Our highly out patient an X want would in HCA to

We've to added off and also that, hospital campus to needs of part been capacity. the well. on but campuses, communities addition we're capacity we've really growth capacity meet of as added adding In that's our our different

aspects invest both sure from have We need the teams of that then we're deserve. a that heavily that And And the process our in investing continue standpoint our communities I'm proud effort supply to standpoint. searches forth. make our patients in and our really we're put delivering that to

question next from from comes Barclays. Andrew Our Mok

a One and question. clarification

First, X%. seeing break us outpatient the on there? on can you're were question, you admissions exchange trends some quarter? And and of then as between Maybe that elaborate hospital of in the the give a just outpatient you the out percentage Can about down surgeries ASC total volumes?

Yes.

right for of exchange just of as they're second as at and ER the visits volumes, was What exchange percent the a on total. So X% admissions well question?

surgery. it, I Yes, right. got It on outpatient was

on mentioned. quarter, uninsured. X% Again, same up, the store about on So ASCs. weighted that And same Yes, sorry. not stores a and over we X% little the we back it's out in X% in a the we're same X% here, in the exclusively little on down hospital that's to Medicaid were -- over and that we

hospital ASC revenue platform was surgery in growth and outpatient our our overall up. So

Our implications up. we of segment profitability yes, on have it. the metric a there aren't a as down, to but our that And result volume was really business that's

question comes from Stephen next Our Baxter Wells from Fargo.

you the couple revision. core a I on wage staffing on of Just if be now any and the was the thinking part contributor that this and inflation if to M&A And guidance to you've higher guidance. there's volumes due hoping revenue of guidance EBITDA I'm your hear more too. if would that potentially then updated great to as wondering not impact you're to. [indiscernible]

inflation, wage as range, in X.X% at how If going we thinking you here consistent that back to stays close and to the and of of were came we're about we kind year, that we look think as we of the X% this to where kind year. are half

So thinking wage will -- steady. inflation be fairly as

there's one M&A. And on then

So on some there M&A. were questions

kind Let me just through of that. run

of So revenue and in the quarter. was dilutive It is About you The from have to million the the Valesco. heard for rest about impact others. And Texas, you are talk negative stores. $XXX Healthcare that's acquisition -- that. X% earnings, new EBITDA in to couple $XXX of side revenue from of System acquisitions million the of that us about though

impact did our So EBITDA material growth way. in year-over-year the not really M&A don't impact any really trends or

next comes Stephens. question Our from Scott Fidel from

or they trying I how even there are And Medicaid of of was get this ago have maybe margins the sort still if not from is back on where inclusive the were talk you to hoping I Medicaid Medicaid evolved years your about how payments. just you they supplemental can just mentioned that of where maybe business to on to circle a yet. back breakeven supplemental to currently closer couple know really maybe had Medicaid the just payments.

walk you us could So through helpful of sort that? if

was level payments is of many And then investor think that sustainability see do states the if are a I do the elections, of White payments states. to although these uncertainty out Medicaid the House, supplemental from switch it's red that in there around just looking notable a there the we are of sponsoring

would So this of But payments topic. around there it is be uncertainty a feels slightly sustainable. like investor these lot quite

on So appreciate your thinking that. we certainly

around the good I'll you. sustainability supplemental take do Medicaid the We thank programs. one Yes, second first. payment see

Texas, frankly, And As Florida. and programs historically, noted, supported of blue states. red well in our states two they're biggest you are both in

So things. that those a give will sense of you

rule Medicaid sustainable provider for this we and and found the actually industry. supportive came new that programs, The on year out be good earlier programs, supplemental to positive

are think If the past. about you time, to supplemental back really of Medicaid, significantly go historically patients and core time, you for Medicaid were below just right, if margins kind the margins caring in you're the they I of in over pretty -- cost mean, payments Medicaid

and Over programs more well But Medicaid patients. about are the and you we last added now, think of the you reimbursement, historical where still plus look cost or states it's enhanced supplemental in several years, the XXXX, they for the short even have caring programs. if pretty some reimbursement have those at base grown payment of

that. provide would So context that's the on that we

Our next Jason from from question comes Cassorla Citigroup.

on side. you're and use ask to CapEx guide of if just I expecting like call just apologies And sounds but out on perhaps there, the the like the should It missed to in there's outlook think but about wanted you're cash outlook. flow or just we share EBITDA free context revenue sounds your for CapEx. to repurchase, from higher raise if curious maintaining how excess that? Just I anything XXXX guess maybe the it I this,

really revising CapEx. We our are not

about talked in that think billion still it's same going we We $X.X year, we range. the $X.X billion. to generally As be started to

expect XXXX comments, going we're As the noted in on billion do repurchase. that about we improved on the to guidance and share our spend updated in outlook based $X

from of would increase the share improved the bulk So towards going results be the repurchase.

may, Sam, add, capital. Mike, if me it's Let I the to

fact the it's we the is I we occupancy important to quarter, inpatient as understand think X% to operate in low level to -- mid bed mid-XXs in in even an which that mentioned. added the that addition on second I inpatient

occupancy reflecting demand that reflecting the we're we experiencing. and market acuity share reflecting gains our patients, the overall inpatient to continues So believe our the grow, of

Those last facilities where and is X,XXX our piece of a are clinics our second The X% up to was about we across out year. company, look for spending continue we network them. development. outpatient one serve it to ambulatory component from have the from Again, build the need as that serves well. our as opportunities other to to network And market patients a we capital will

And environment the that business. have patients. for facilities to piece we in requires our an infrastructure. third the have It mean are is I infrastructure us appropriate

We upgrade forth. so and have to those facilities basic of elements

that lot maintenance. a so And is of

towards of our need capital half goes where maintenance keep to facilities to So our they be.

And is then the technology. thing for last us

more We in technology because for see it are agenda support serve we even us next-generation the investing growth to allow our our patients opportunities and company's to better.

So our technology component of our CapEx continues to grow.

is long-term All of the in demand. of this backdrop our view on

indicated our zone we As X% at Investor to November in Day, that be to we well. expect long-term in demand X% as

so that to capabilities serve accomplish. and to our able networks our where to plan capital And in necessary facilities we have expenditure be that's to in is build our demand, the intended

I $X.X clarify $X.X billion $X.X to real quick. let said It's to in capital actually Sam, spending $X.X billion me billion XXXX. billion. for

next comes Our America. question Fischbeck Bank from from of Kevin

point this be this when timing margins from this supports we year's growth? It the that the think as a year side -- to from the to I base headwind demand future. for the that obvious and about thinking moderate there's a whether of when right you good of might we next there the Is a color think about you more or Is thinking way Is takes about of could to? comes volume any and about see timing wanted you bit there as about sometimes or stronger this for, anything in year? the things. be payments. base next thinking kind a little for know expect, some sounds in mentioned about a puts you than than margin the sustainability? Is margin on you ex little and that past EBITDA volume should we would into believe volume you I if maybe plan like the maybe year leverage would base give

X year. speak is And the unusual through is slightly said, will This to Mike far XXXX. I not core supplemental this going, have months by do we first aren't We event tell Kevin, programs. this that operations. Medicaid the you Sam, as thus any

operational as So comparison of with experienced it's the Valesco sort level the of forth, core with and with challenges a some that so performance, payment COVID, choppiness quite the by so supplemental with we of occurs to and of plain year just some last timings really naturally the of inheritance forth.

the a I'd volume look balance at this really the the of solid is the in But months, supported and that about and operational we strong any unusual material benefiting performance, really business X year, how first or That's question. not think by answer when dragging we right. items

question comes ] Ryan TD from Langston Cowen. from next Our [

impressive stay and go second. to maybe there to labor next pass want and in a back results, that about Just think throughput achievements for to maybe driving Obviously, of carrying these forward results. Is particular anything recent how length reduction the over quarters? few

hospital where to end you M&A and to you more need expansion? potential And the market, Understand market that us side. the be larger entertain can a parameters you But the maybe on focus. national would or ambulatory there some both the remind of in is then just market deals larger maybe just tends

Yes.

you contract in about and half really recruitment been our think labor. of years, the this reduction our first working over as to the activities that kind if doing of work on driver, compared several the labor, comes year we've already the in prior improving last the performance said, biggest was through So And we've all year retention.

of improved of talk super all recruitment our kind our of -- that School On into of markets, the about beneficial. Nursing. heard which has has work us produced been side, affiliation academic supply nursing around the And our work, you've

in and comments, some. range to I my do X.X% do that think of we'll a as noted the wages comment think contract have noted back from go-forward a in percentage of contract salary we're We've mid-X my run in labor -- perspective, down labor I And as the I we're as that year. probably guided, the on improvement, guidance the we'll of we think half you've still from benefits.

some the improvement in there's So future.

incremental improvement and contract been the of I now as to think big recruiting and to more we the reflected COVID really work labor highs from on continue what's move retention. is But have on come

So material -- labor good. don't been see that related stable. of I be that. than kind coming and my inflation It's other has productivity mean It's XXXX. Wage our to anything would remains driving I -- off COVID into trends.

think So think from when year. to that back about things the half those major the of the now are we about we

And is even let ways that. more employees our just I put our wrap now a they at mean Mike, succeed help what around focus do. to me finding

we're workforce so investing investing of existing are we forth. our So as as nurses much and education new just in education in and

around better our supporting improving care. are our deliver they caregivers can We processes so

we initiatives and day really our basis. for So our and that nursing so our good for And sure are organization. because day leaders number in our investing patients out outcomes to have of the support outcomes resources in good caregivers that produce a we're and leadership for and on connected heavily that have a make we good forth operations

those are to Mike So wraparounds things alluded just to. what

we our And That alluded business as number results to Texas very to outcome. complementary. have to acquisitions of one With to, platform North respect added Mike a to added our we with the market to year hospitals other. from as out M&A, but to market, this Texas, some see good produced Houston, our small added there. In has And starting a example, we of network very an an outpatient good them. we're tuck-in

model We selective fits that sure the balance we're acquisition that We can are acquisitions. returns know making sheet have that. and and we from But we to very bigger. around the expect produce an support to the be built that,

don't yes, haven't but markets? necessarily enter know presented from we model. those that Will new opportunities we'll I themselves. our deviate Hopefully,

for work that's local better centered system we our obviously it. patients more don't other work to on is community, best that stakeholders better making do better the could company. and answer for connected model that, are for our system for but the our work Our -- better, We works the think

And up produce that's been we the for outcome durability from that, this cause something part ways to will Healthcare. HCA It's deviate really of as to true it possible we haven't point. define our stakeholders. in seen model but It's to a that staying good the really what us of that

networks we our acquisitions and markets we advancing where business, doing serve. strategic our focus that So in great our these in on investing back can complement selective our is really that position

And one labor. on more comment

-- helpful year-to-date this very reduction in length was stay. that the in of not thing X% for but quarter, us only other The the is

our think the increase length side, mentioned inpatient on you did say. were program mentioned the labor. levels and had of in supports bed Sam way X% also X% in of capital count efficiency our But X%. up the how that service drop about costs earlier if investment reduction length we we're we then Sam of ER our So volume that from and our a and stay efficiency this, our in percent managing the kind admission growth labor almost in occupancy X%

wanted So I add that to well. as

Our next comes from John James. from Raymond question Ransom

Great job.

half, look compare DPP if is, 'XX versus Just a getting back the back happen 'XX we're of the question at in your have you curious, to you do half?

for million Here's million, $XXX when what say on the about year this programs. would $XXX talked headwind that a thought of half guidance would about We supplemental I came we have the Medicaid we we back payment year.

into of this deeper gotten $XXX that we've now $XXX year, we're tailwind. that million changing a to to million updating or kind As

to flip million about half in think first 'XX. of that of So if that $XXX million, I would occurred you $XXX the already of tell much you that

payment about half half expecting the XXXX. the similar will we you think if supplemental had what So of we're back programs of for what to look 'XX, in pretty back

but could is modest, a little one bigger flows, M&A, in if it M&A EBITDA? sneak contribution the in looks it looks cash Because table. M&A I just And your year-over-year quite has like your more. what to Okay. been

we guide, -- guided when effect for of your 'XX? you fully can So that the was kind in and M&A

Valesco moves way I That was I activity. earnings Valesco. as new includes, the is M&A talking note of earlier, X% I next the by kind way, in -- of stores. for that M&A of second is impact or impact not and dilution was quarter think quarter. mean, about year. said for about terms to is. a another kind mean about our It same-store to I quarter But the us M&A that would related you'll see to that material I if the EBITDA from of Valesco XXXX into think stop for so in It the a

quarter, slightly fourth And last of moves we're And it that it's through hopeful gets as year, the of dilutive. half end the the Mike, by better. the it not

comes Our next Research. question Nephron from Joshua from Raskin

of coming the those translate population? now with we into admissions are that commercial that that patients And Just heard What assume exchange exchanges. X% should I are from broader getting ACA does back coverage. margins to carry revenues? patients of typical the

best it's It's Medicare. commercial. a -- What about below payer. above reimbursement It's category, health exchange level, our from payer we below care our say typically second it's

between So it's in those.

less about. typical we're but roughly would margins, Medicare your margins it would So talking better than have what than be commercial

revenues. So you like of look at if X% something on X% admissions, of revenue,

next Our Cantor Sarah James . question from Fitzgerald. of comes

commercial you if some were related Can XQ to surgeries rebooked? in the holidays that give were clarity outpatient us

then it if low of half outpatient digits. look just dropped step at year I down a last to mid-single-digit. started surgical single was taking and trends, And first kind back, Redetermination

negative for of half this year. a X% Now it's first

to half like see be to is change start anniversary should now last we that we impacts? start that to fall full the Medicaid? all of So half year some back related as first from year the too, the this mid-single-digit of off And then to in negative

the categories. are that surgery outpatient with uninsured category on associated declines as in declines as self-pay well Again, Medicaid volume

process, exchanges in mean, migrated pretty both a redetermination categories of yet, who So with maybe volume year-to-date, there's I from when respect those patients access to services. our into different Medicaid of much not thesis they XXX% category It's explained inside company. seasonality through the proven of the a declines. that

We'll of the see have. have the move we through how theory a to year. that balance as that's plays So out we

the produced been level of this it's in movement the in know to we've business one has sure. in should to before good this fact, -- from important growth with the that and that can for if, it for revenue half our of situation. accurate, business is surgery financial But company. -- half our experience the solid the again, other growth being than that year. land in And first on think second seen understand don't We pretty change need better be we the the a outcome we the year service the But class outpatient I thesis that to our

from Medicaid X year. into last our year states. about the towards just I of really the of remember We're speed gaining on most Sarah, process last redetermination redeterminations. add But year, in started end would you

So I the you'll think until period get year-over-year full to the you comparison sunset end don't or of anniversary the you're into year. closer Medicaid

hand now Thank remarks. over Mr. our Frank to session. like for to This you. final I'd now Morgan concludes question-and-answer back

for can your successful you thank I'm additional everyone hope today, thanks Ellie, I might and call. for joining you our week great so to afternoon, much any help answer Thank you. you earnings have if a season. a We this questions have. and around

attending for today's conference everyone, you, Thank call.

Have disconnect. may now day. wonderful You a