Home Care giant LHC Group fired a warning shot to Wall Street Monday to expect a disappointing third quarter when the company reports earnings after the close of trading on Nov. 3.
The Lafayette, LA-based firm said the combination of agency closings due to Hurricane Ida and clinicians quarantined due to the pandemic resulted in a $15 million loss in revenues for the quarter ended Sept. 30.
“We lost the equivalent of 120 operating days from temporary location closures related to the hurricane and experienced capacity constraints due to the Delta variant’s impact on clinicians having to quarantine,” Keith Myers, LHC Group chairman and CEO, said in a statement.
The company said 39 home health agencies and 3 hospices were temporarily closed during the quarter due to the late August hurricane, resulting in a 1.5% decline in average daily home health census for the quarter. The percentage of clinicians under quarantine increased from 0.25% at the end of the second quarter of 2021 to 3% at the end of the third quarter. The loss of staff forced LHC Group to rely more heavily on contracted labor.
The company has readjusted guidance downward for 2021 from $6.30 to $6.50 per share to $5.75 to $5.85 per share.
Despite the unexpected headwinds in the previous quarter, LHC Group said census has been improving and the number of clinicians under quarantine has declined. Myers said fundamentals for the company continue to remain strong.
“We continue to experience year-over-year growth in traditional patient referrals driven by an increasing preference by patients, referral sources, and payers for high quality healthcare services delivered in the home as opposed to inpatient post-acute settings,” Myers said. “This underlying increased demand shows no sign of abating.”
LHC Group operates in nearly 800 home health, hospice and home-and-community-based service locations in 35 states and the District of Columbia.
