Finishing the acquisition of Gentiva's private care enterprise stays a high precedence at Addus HomeCare Corp. (Nasdaq: ADUS). The $350 million transaction was first introduced in June.

Addus Chairman and CEO Dirk Allison defined how he believes the deal will higher place the corporate for the affect of the Making certain Entry to Medicaid Companies rule.

“We imagine our private care section advantages from each scale and broad geographic protection within the states the place we function,” Allison mentioned Tuesday in the course of the firm's third-quarter earnings name. “That is very true in managed Medicaid states, and because of the ultimate Medicaid entry rule, if and when it may be carried out, this scale and protection will enable us to unfold our prices over a bigger income base and supply Addus the chance for significant advocacy with the states we serve, whereas additionally selling a extra favorable recruitment and retention atmosphere.”

With Gentiva's private care belongings, Addus will turn into the most important private care supplier in Texas, a primarily managed Medicaid market.

As well as, the deal provides Addus an expanded footprint in Arkansas and strengthens the corporate's personal payroll and Veterans Affair companies in California and Arizona. It additionally expands the corporate's presence in Tennessee and supplies entry to Missouri and North Carolina.

As a part of the transaction, Addus can also be centered on integrating Gentiva's private care workforce.

“I imagine now we have very properly deliberate for the modifications that may happen as soon as this acquisition is accomplished,” mentioned Allison. “Our planning was centered on minimizing the affect on frontline workers and making certain the continued supply of high quality providers to our clients as we transfer by way of the combination course of. We respect the efforts of Gentiva's private care crew as they proceed to supply high quality providers to its clients. We stay up for the numerous new crew members who will be a part of the Addus household as soon as the transaction is accomplished.”

After Humana Inc. (NYSE: HUM) acquired Kindred at Dwelling, it finally divested that firm's private care and hospice belongings. Humana created CenterWell Dwelling Well being and people divested belongings turned Gentiva.

Gentiva has strategically shifted its focus to hospice and palliative care.

Allison famous that this deal is anticipated to shut within the fourth quarter of 2024.

Through the name, Allison additionally identified the success Addus has skilled in relation to hiring private care providers. Within the third quarter, the corporate added 79 new staff per working day.

Furthermore, Addus's turnover figures have remained at a “traditionally low” degree.

In the meantime, Addus has seen continued enchancment in labor metrics throughout its medical service traces.

Within the third quarter, Addus continued to leverage the funding the corporate acquired from the American Rescue Plan. The corporate acquired one other $3.2 million in funding and used greater than $2.5 million, leaving roughly $13 million in accessible funds.

“These funds proceed for use to help with recruitment and retention of caregivers, in addition to different alternatives to enhance the expertise and coaching of our caregivers,” Allison mentioned.

Allison additionally supplied an replace on the reimbursement environments through which Addus operates.

“In our private care section, our providers proceed to obtain favorable reimbursement assist for lots of the states through which we function,” he mentioned. “We proceed to imagine that our states stay in good monetary place because the economic system seems secure presently. We’re assured that private care providers will proceed to ship actual worth to state Medicare applications, in addition to our managed care companions, by lowering the general value of care.”

An instance of the favorable reimbursement assist the corporate is seeing is in Illinois. The state is Addus' largest in private care providers and can implement a 5.5% price improve. The corporate expects this price improve to generate $23 million in annual income.

On the house care aspect, Allison commented on the discharge of the 2025 house care closing fee rule.

“Whereas we respect that the ultimate price adjustment is barely extra optimistic than the proposed price, we’re dissatisfied that CMS continues to pursue each non permanent and everlasting reimbursement reductions for house well being care suppliers, which we imagine will affect affected person entry to this useful and much-needed profit restricted. service,” he mentioned. “Whereas present Medicare house care ranges stay difficult, and seem more likely to stay so in 2025, we proceed to imagine that conventional Medicare house care burdens are more likely to decline within the coming years, in response to well-documented entry points sufferers.”

Addus continues to be evaluating the affect the ultimate rule could have on its enterprise, however since house care is barely a small a part of it, CFO Brian Poff believes the affect will probably be “insignificant” for the corporate as an entire.

For the third quarter of 2024, Addus' web providers income elevated 7% to $289.8 million, in comparison with $270.7 million for the third quarter of 2023.

Private care revenues had been $215.4 million, in comparison with $201.8 million in the identical interval final 12 months. Dwelling care revenues had been $17 million, in comparison with $15.7 million within the third quarter of 2023.