Amedisys Gearing Up for the Rest of 2022 Following CEO Transition News

Amedisys Inc. (Nasdaq: AMED) is gearing up to execute on its 2022 strategy while positioning itself for 2023, which it sees as a year of major upside.

The company detailed those plans Wednesday at the 40th Annual J.P. Morgan Healthcare Conference, just days after its announcement that current CEO Paul Kusserow will retire from the role in April.

“I think this is very good news for investors,” Kusserow said at the conference. “And the timing is good because, frankly, we believe that all the key elements of the business are running well.”

Baton Rouge, Louisiana-based Amedisys provides home health, hospice, personal care services and higher-acuity care in the home. The company operates across 529 care centers in 38 states and the District of Columbia.

On Monday, it announced that Chris Gerard, who currently serves as president and COO, will assume the role of president and CEO in April. Kusserow will continue on as chairman of the board for Amedisys.

“This has been long-planned,” Kusserow said. “Chris has led operations for five years. He’s been president of the company for almost a year. We looked at transitioning Chris a year ago and started a very [methodical] succession process. Chris has run about 90% of the company for the last five years, … and he’s well-known to investors.”

Focusing on a number of key areas, Kusserow noted that Amedisys has a clear strategic direction for the next two to three years.

The COVID-19 emergency continues to be a headwind and underscores the need for sophisticated labor strategies. Amedisys has seen the benefits of employing unique approaches to labor, including flexible scheduling.

As a result, the company has lowered its voluntary turnover rate to about 18%.

Amedisys, which mostly operates under Medicare, has also seen an increase in Medicare Advantage (MA) penetration rates. As a response to MA growth, the company has developed risk-based case-rate tools.

“We’re coming up with some new and creative risk-taking models that we’re willing to and ready to test out with some [MA] plans out there,” Gerard said. “We’re having a very good dialogue with a number of plans today. We feel like it’s going to actually drive value for everybody.”

As far as tailwinds, Amedisys sees the longer-term demographic, psychographic, regulatory, reimbursement and economic forces as favorable.

“We’ve got baby boomers who are just turning 76,” Kusserow said. “Our average age is 77 to 78. The tsunami of the baby boom is starting to hit. Also, these baby boomers want to stay at home. They want to age in place. It’s a very good time to be in the home health business.”

Long-term tailwinds from the U.S. aging population. | Source: Amedisys

Amedisys also views its differentiated service offerings as a growth driver. Along these lines, the company’s $250 million purchase of Contessa Health last year has added another booming service line to its repertoire, allowing the company to treat higher-acuity patients in their homes.

“We’re really excited about what we’re seeing there — very strong demand,” Kusserow said. “[Contessa Health] is the leader in this hospital-at-home, SNF-at-home, palliative care at home [market]. These folks are the real deal. They can do it when there’s a lot of imitators out there who can’t.”

Looking ahead, Gerard believes Amedisys is poised to have a strong year, though the company generally sees 2022 as a ramp-up period for 2023.

“​​The continuing pandemic has impacted our near-term growth opportunities and the way in which we do business, putting a premium on clinician capacity and highlighting the need for sophisticated labor strategies,” a slide deck shared by the company explains.

Amedisys additionally sees long-term upside beyond 2022 due to industry consolidation and “significant revenue growth” from Contessa, as higher-acuity care in the home becomes more mainstream.

“We have a very nice pipeline ready for M&A,” Kusserow noted. “We think when the Cares Act money comes down, or comes out of the system, that there will be consolidation opportunities. So, we’re quite excited about that.”

“These baby boomers want to stay at home. They want to age in place. It’s a very good time to be in the home health business.”

– Amedisys CEO and Chairman Paul Kusserow

The post Amedisys Gearing Up for the Rest of 2022 Following CEO Transition News appeared first on Home Health Care News.