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| 8-K - FORM 8-K - AMEDISYS INC | d546131d8k.htm |
| EX-99.2 - EX-99.2 - AMEDISYS INC | d546131dex992.htm |
 Investor
Presentation Leading Home Health & Hospice
May 2013
clinical
quality
innovative
care models
better
communities
Exhibit 99.1 |
 Forward-looking Statements
This presentation may include forward-looking statements as defined by the Private
Securities Litigation Reform Act of 1995. These forward-looking statements are based
upon current expectations and assumptions about our business that are subject to a
variety of risks and uncertainties that could cause actual results to differ materially
from those described in this presentation. You should not rely on forward-looking
statements as a prediction of future events.
materially from those discussed in any forward-looking statements are described in
reports and registration statements we file with the SEC, including our Annual Report on
Form 10-K and subsequent Quarterly Reports on Form 10-Q and Current Reports on
Form 8-K, copies of which are available on the Amedisys internet website
http://www.amedisys.com
at (800) 467-2662.
We disclaim any obligation to update any forward-looking statements or any changes in
events, conditions or circumstances upon which any forward-looking statement may be
based except as required by law.
2
www.amedisys.com
NASDAQ: AMED
We encourage everyone to visit the
Investors Section of our website at
www.amedisys.com, where we have
posted additional important
information such as press releases,
profiles concerning our business and
clinical operations and control
processes, and SEC filings.
We intend to use our website to
expedite public access to time-critical
information regarding the Company in
advance of or in lieu of distributing a
press release or a filing with the SEC
disclosing the same information.
or by contacting the Amedisys Investor Relations department
Additional
information
regarding
factors
that
could
cause actual
results
to
differ |
 Company
Overview 1
3
•
Founded in 1982, publicly listed 1994
•
524 care centers in 38 states
•
15,100 employees
•
Projected revenue in 2013 of approximately $1.3
billion
•
Largest provider of skilled home health services
•
4
th
largest hospice business
1
For the quarter ended March 31, 2013 |
 Business
Segments 4
Business
Segment
% of
Revenue
Reimbursement Type
HH -
Medicare
65%
Paid episodically (over a 60-
day episode of care)
HH –
Non-Medicare
15%
Majority paid per visit;
remainder paid episodically
Hospice
20%
Mainly Medicare; paid at a
daily rate
1
Revenue mix based on 1Q13 revenue
65%
15%
20%
Revenue Mix
¹
HH -
Medicare
Hospice
HH -
Non-Medicare |
 Care Center
Locations 1
5
Home Health Care Centers (427)
Hospice Care Centers (97)
1
As of March 31, 2013 |
 Estimated
Market
Share
–
Medicare
Revenue
6
13.6%
13.6%
5.7%
7.9%
56.8%
12.5%
17.1%
Home Health
Amedisys
Public Peers
For Profit
Hospital-based
Non-Profit
1.5%
12.1%
45.2%
7.8%
33.4%
Hospice
Amedisys
Public Peers
For Profit
Hospital-based
Non-Profit |
 7
Home Health/Hospice Medicare Spend
Home Health Source: CBO March 2013 Baseline report (10 year CAGR)
Hospice
Source:
2011
actual
hospice
spending
with
growth
rate
based
on
“Other
Services”
section
of
CBO
March
2013
Baseline
report
(10
year
CAGR)
Population growth estimates provided by Tetrad; CAGR is for 2012-2017 (5 years)
Compound Annual Growth Rates (CAGR)
Home Health Expenditures = 4.4%
Hospice Expenditures = 5.2%
65+ Population = 3.6%
75+ Population = 2.6%
15
15
16
17
17
19
20
21
22
24
19
19
20
21
21
22
24
25
27
28
$-
$5
$10
$15
$20
$25
$30
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
Hospice
Home Health |
 Medicare
Reimbursement 8
Reimbursement
Considerations
Reimbursement
Considerations
-
-
-
-2.0%
-2.4%
-5.2%
1.9%
-2.3%
-4.2%
-6.0%
-3.0%
0.0%
3.0%
6.0%
2013
2012
2011
2010
Home Health
Industry
AMED Specific
-1.1%
Industry
AMED Specific
1.1%
2.4%
1.8%
1.4%
-6.0%
-3.0%
0.0%
3.0%
6.0%
2013
2012
2011
2010
Hospice
Expected in July
•
2014 rebasing
•
Sustainable growth rate legislation
(Doc Fix)
•
Co-payment proposals
•
2014 proposed rule
•
Hospice rebasing (U-shaped
reimbursement)
•
Nursing home reimbursement
2014
-
Proposed
2014
-
Proposed |
 Favorable Long
Term Trends •
Compelling demographics
•
Patient preference
•
Low cost of care delivery
•
Increased payor and hospital focus
9
Inpatient
Hospital
LTAC
IRF
SNF
Hospice
Home
Health
Average Cost of Stay
$11,700
$38,664
$17,398
$11,728
$11,321
$5,257
Average Length of Stay
5 days
26 days
13 days
27 days
86 days
120 days
Average Per Diem Cost
$2,388
$1,470
$1,338
$431
$132
$44
Source: MedPAC March 2013 report; hospital information is for inpatient facilities only and is
estimated based on patient discharges |
 Traditional Home
Health and Hospice 10
Current
Business
Dynamics
Issues
•
Fee for service based
•
High volume / low margins
•
“Retail”
relationships
•
Patients with multiple
conditions
•
Limited physician
coordination
•
Poor coordination /
communication
•
Misaligned incentives
•
Minimal data interchange
•
Regulatory limitations on
services |
 Future
Trends 11
Home
Health
Coordinated Care
Management
Patient
Home
Hospice
Post-Acute
Facilities
Payors
Physicians
Hospitals
•
Aligned incentives
•
Data exchange
•
Communications
•
Care Protocol
•
Outcome focused
•
Value driven
Informal
Care Givers |
 Care Management
Initiatives •
Patient care management
•
Shared service care centers
•
Bundled payment initiatives
•
Next generation operating system
•
Other
–
ACO partnerships
–
Enterprise-level relationships
–
Palliative care and medical home
12 |
 Patient Care
Management 13
•
“Right Care. Right Time. Right Place.”
•
Centralized support
–
Local clinical decisions
–
Exception reporting
•
Recertification review
–
Attainment of patient goals
–
Physician orders or medication changes
–
Hospitalization during episode
•
Utilization focus
–
Reduce care plan variability
–
Patient outcome driven |
 Shared Service
Model •
~ 475 care centers organized into 70 “pods”
–
Completed by the end of 2013
–
~850 ADC; $20M in revenue per “pod”
14
Quality Care
Operational
Efficiency
Leadership
•
Centralized functions (on-call, intake, scheduling)
•
Scheduling efficiency
•
Specialty clinician productivity
•
Clinical resource support
•
Consistency in care delivery/training
•
POD leadership supporting all care centers
•
Improved leadership turnover coverage |
 Bundles
•
CMS Bundled Payment for Care Initiative (BPCI) program
–
Amedisys focused on Model 3 (post-acute)
–
CMS to set target price for relevant services during bundle
–
Awardees share savings and “at risk”
for costs greater than target
•
Amedisys in awardee process in 5 regions
–
Currently in Phase I --
a no-risk reporting and ramp-up period
–
Phase II (at risk), expected to begin October 1, 2013
–
Developing partnerships with hospitals/other partners to manage
•
Also focused on ACOs and Model 2 bundles
15 |
 AMS3 Operating
System •
4Q13 Development complete / implementation begins
•
Migrating to .Net platform
Existing platform sun setting
•
Benefits of proprietary system
–
Low incremental spend
–
Ongoing flexibility and customization
•
Enhancements over existing system
–
Greater clinician productivity
–
Superior clinical management engine
–
Care center efficiencies
–
Interoperability
–
Billing efficiencies
–
Expect $10-$15M in net annual savings after fully rolled out
16 |
 Capital
Expenditures 17
PeopleSoft
IT Security
AMS3 Development
28.4
36.4
64.0
44.4
48.3
48.0
2.4%
2.4%
4.0%
3.0%
3.2%
3.7%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
0.0
25.0
50.0
75.0
100.0
125.0
2008
2009
2010
2011
2012
2013 |
 Summary
Financial Results 18
(Continuing operations only. $ in millions, except per share
data)
2011
(1)
2012
(1)
1Q12
(2)
1Q13
(2)
Adjusted Net Revenue
$ 1,464
$ 1,488
$ 371
$ 339
Gross Margin %
46.7%
43.5%
43.8%
43.2%
Adjusted EBITDA
$ 157
$ 103
$ 27
$ 17
Adjusted EBITDA Margin
10.7%
6.9%
7.3%
5.1%
Adjusted EPS
$2.29
$1.08
$0.29
$0.13
1.
The financial results for the years 2012 and 2011 are adjusted for certain items incurred in
2012 and 2011 and should be considered non-GAAP financial measures. A
reconciliation of these non-GAAP financial measures is included as Exhibit 99.2 to our
Form 8-K filed with the Securities and Exchange Commission on March 12, 2013.
2.
The financial results for the three-month period ended March 31, 2013 and March 31, 2012
are adjusted for the legal fees associated with investigations of $1.2 million and $2.2
million, respectively, and should be considered a non-GAAP financial measure. A reconciliation of this non-GAAP financial measure is included as Exhibit 99.2 to our
Form 8-K filed with the Securities and Exchange Commission on April 30, 2013 |
 Home Health
Segment 19
($ in millions, continuing operations)
2011
(1)
2012
(1)
1Q12
(2)
1Q13
(2)
Medicare Revenue
$ 1,038
$ 953
$ 242
$ 221
Non-Medicare Revenue
$213
$245
$59
$51
Total Revenue
$ 1,251
$ 1,198
$ 301
$ 272
Gross Margin %
46.9%
42.3%
42.9%
42.3%
Contribution
$220
$124
$32
$26
Contribution %
17.6%
10.4%
10.5%
9.4%
1.
Results as reported in our Annual Report on Form 10-K for the year ended December 31,
2012 as filed with the Securities and Exchange Commission on March 12, 2013. 2.
Results as reported in our Quarterly Report on Form 10-Q for the quarter ended March 31,
2013 as filed with the Securities and Exchange Commission on April 30, 2013 |
 20
Home Health Operating Statistics
2011
(1)
2012
(1)
1Q12
(2)
1Q13
(2)
Medicare
Admissions
202,603
200,590
51,153
52,122
Same store admissions growth
(5)%
0%
(2)%
2%
Recertification rate
44.4%
42.2%
43.5%
37.7%
Revenue per episode
$3,027
$2,874
$2,882
$2,782
Visits per episode
18.7
18.7
18.6
17.4
Non-Medicare
Admissions
73,880
93,016
23,192
22,423
Visits
1,754,255
2,074,446
504,398
436,035
Revenue / Visit
$121.30
$118.30
$116.97
$117.42
1.
Results as reported in our Annual Report on Form 10-K for the year ended December 31,
2012 as filed with the Securities and Exchange Commission on March 12, 2013.
2.
Results as reported in our Quarterly Report on Form 10-Q for the quarter ended March 31,
2013 as filed with the Securities and Exchange Commission on April 30, 2013. |
 Hospice
Segment 21
($ in millions, continuing operations)
2011
(1)
2012
(1)
1Q12
(2)
1Q13
(2)
Total Revenue
$ 218
$ 290
$ 69
$ 67
Gross Margin %
46.5%
48.3%
47.4%
47.1%
Contribution
$49
$62
$15
$12
Contribution %
22.6%
21.4%
21.9%
17.5%
Operating Statistics
Total admissions
15,889
19,161
4,902
4,992
Same store revenue growth
19%
13%
17%
(5)%
Average daily census (ADC)
4,197
5,427
5,190
5,091
Average length of stay (ALOS)
88
99
91
103
1.
Results as reported in our Annual Report on Form 10-K for the year ended December 31,
2012 as filed with the Securities and Exchange Commission on March 12, 2013 2.
Results as reported in our Quarterly Report on Form 10-Q for the quarter ended March 31,
2013 as filed with the Securities and Exchange Commission on April 30, 2013. |
 22
Summary Balance Sheet
Assets
Dec. 31, 2012
Mar. 31, 2013
Cash
$ 15
$ 7
Accounts Receivable, Net
169
145
Property and Equipment
157
156
Goodwill
210
210
Other
180
194
Total Assets
$ 731
$ 712
Liabilities and Equity
Debt
$ 103
$ 79
Other Liabilities
174
171
Equity
454
462
Total Liabilities and Equity
$ 731
$ 712
Leverage Ratio
1.10x
0.95x
Days Sales Outstanding
42
37
($ in millions) |
 23
Liquidity
1
1.
Unused revolver of $143 million
2.
1Q13
scheduled
debt
repayment
includes
$20M
principal
payment
of
senior
notes
due
in
March
2013,
at
end
of
quarter
$20M
in
senior
notes
remain
outstanding
and
are
due
in
March
2014
3.
Other cash flows include refinancing costs associated with credit agreement signed on October
26, 2012, retirement of long-term debt and acquisitions. ($ in millions)
2012A
1Q13A
2013F
Cash Flow From Operations
$ 69
$32
$ 94-99
Capital Expenditures
48
10
45-50
Scheduled
debt
repayments
2
29
24
36
Cash Flow, Net
(8)
(2)
8-18
Beginning Cash
48
$15
Other
3
(25)
(6)
End Cash
$ 15
$7 |
 1Q13 Announced
Initiatives •
Exiting 50 low-performing care centers
–
~15 will be consolidated with other care centers
–
~35 will be divested
–
~$10M annualized run rate EBITDA improvement
•
Corporate cost savings
–
~$5M annualized run rate EBITDA improvement
•
Patient care management
–
Consistency in care
–
Improved utilization and outcomes
24 |
 25
Guidance
¹
Calendar Year 2013
²
Net revenue:
$1.28 -
$1.32 billion
EPS:
$0.45 -
$0.55
Diluted shares:
31.5 million
1.
Guidance based on continuing operations excluding the effects of any one-time costs
associated with our announced market exit activity or corporate expense initiatives.
2.
Provided as of the date of our form 8-K filed with the Securities and Exchange Commission
on April 30, 2013. |
 Investment
Rationale •
Favorable demographic trends
•
Positive attributes of home based care
•
IT infrastructure/scalability
•
Clinical quality and innovation
•
Strong liquidity and capital position
•
Market share capture opportunities
26
Efficient Core
Business
Care Mgmt
Solutions |
 Contact
Information Tom Dolan
SVP Finance and Treasurer
Amedisys, Inc.
5959 S. Sherwood Forest Boulevard
Baton Rouge, LA 70816
Office: 225.299.3391
Fax: 225.298.6435
tom.dolan@amedisys.com
27 |