Amedisys executives said continued labor headwinds should provide opportunities to acquire smaller, struggling home health care companies in the year ahead.
“Our pipeline is as good as it’s been and we think we’ll have some actual things coming up pretty soon,” Amedisys Chief Financial Officer Scott Ginn said during a virtual J.P. Morgan Healthcare conference on Wednesday.
The labor shortage challenged Baton Rouge, LA-based Amedisys in the third quarter of last year. The company reported its net revenues declined 37.5% in the quarter compared to the same period in 2020 due in part to a 6% increase in labor costs.
But soon-to-be CEO Chris Gerard told investors the company is reining in labor costs and is deploying targeted bonuses to employees, rather than across-the-board wage hikes.
“In 2022, we think we can bring that labor inflation down to 3% to 4% by pulling all of those workforce optimization levers,” Amedisys President and COO Chris Gerard said.
Amedisys announced Monday that Chairman and CEO Paul Kusserow will retire from the CEO post in April and Gerard will assume the leadership role. The J.P. Morgan conference was the first time Kusserow and his executive team addressed the succession publicly.
“The timing [of the succession] is good because frankly we believe all the key elements of the business are running well,” Kusserow said. “We believe that we’ve assembled fantastic assets that we now need to execute on and our strategic direction is now clear for the next two to three years.”
Amedisys is currently focused on folding Contessa, a hospital-at-home business it acquired last year, into its operations. The addition of Contessa provides depth and breadth to Amedisys, which also offers home health, personal care and hospice. Kusserow said the addition of Contessa will help it bundle services to other healthcare providers.
“We are having a lot of conversations with hospitals that are saying to us if you’re doing this really well with Contessa, maybe you should take over our home health and hospice assets,” Kusserow explained.
