Community Health Systems Inc (CYH) 2023 Q1 法說會逐字稿

Good morning, everyone, and welcome to the Community Health Systems First Quarter 2023 Earnings Conference Call. (Operator Instructions) Please also note that today's call is being recorded. At this time, I'd like to hand the floor over to Shelly Schussele, Senior Director of Investor Relations. Ma'am, please go ahead.

大家早上好，歡迎來到社區衛生系統 2023 年第一季度收益電話會議。 （操作員說明）另請注意，今天的通話正在錄音中。現在，我想請投資者關係高級總監 Shelly Schussele 發言。女士，請繼續。

Thank you, Jamie. Good morning, and welcome to Community Health Systems' First Quarter 2023 Conference Call. Joining me on today's call are Tim Hingtgen, Chief Executive Officer; Kevin Hammons, President and Chief Financial Officer; and Dr. Lynn Simon, President of Clinical Operations and Chief Medical Officer.

謝謝你，傑米。早上好，歡迎來到社區衛生系統 2023 年第一季度電話會議。與我一起參加今天電話會議的還有首席執行官 Tim Hingtgen；總裁兼首席財務官 Kevin Hammons；臨床運營總裁兼首席醫療官 Lynn Simon 博士。

Before we begin, I would like to remind everyone -- this conference call may contain certain forward-looking statements, including all statements that do not relate solely to historical or current facts. These forward-looking statements are subject to a number of known and unknown risks which are described in headings such as Risk Factors in our annual report on Form 10-K and other reports filed with or furnished to the Securities and Exchange Commission. As a consequence, actual results may differ significantly from those expressed in any forward-looking statements in today's discussion. We do not intend to update any of these forward-looking statements.

在我們開始之前，我想提醒大家——本次電話會議可能包含某些前瞻性陳述，包括所有不僅僅與歷史或當前事實相關的陳述。這些前瞻性陳述受許多已知和未知風險的影響，這些風險在我們的 10-K 表格年度報告和向美國證券交易委員會提交或提供的其他報告中的風險因素等標題中有所描述。因此，實際結果可能與今天討論的任何前瞻性陳述中表達的結果大相徑庭。我們不打算更新任何這些前瞻性陳述。

Yesterday afternoon, we issued a press release with our financial statements and definitions and calculations of adjusted EBITDA and adjusted EPS. We have also posted a supplemental slide presentation on our website. All calculations we will discuss on today's call exclude gain or loss from early extinguishment of debt, impairment expense as well as gains or losses on the sale of businesses, expense from governments and other legal matters and related costs, expense related to employee termination benefits and other restructuring charges.

昨天下午，我們發布了一份新聞稿，其中包含我們的財務報表以及調整後 EBITDA 和調整後 EPS 的定義和計算。我們還在我們的網站上發布了補充幻燈片演示。我們將在今天的電話會議上討論的所有計算不包括提前清償債務產生的收益或損失、減值費用以及出售業務的收益或損失、政府費用和其他法律事務及相關費用、與員工解僱福利相關的費用以及其他重組費用。

With that said, I will turn the call over to Tim Hingtgen, chief Executive Officer.

話雖如此，我將把電話轉給首席執行官 Tim Hingtgen。

Thank you, Shelly. Good morning, and welcome to our first quarter conference call. Our first quarter results include solid growth metrics and other promising indicators that demonstrate core demand for health care services is returning and that we are making progress with our initiatives and investments to capture volume.

謝謝你，雪莉。早上好，歡迎來到我們的第一季度電話會議。我們第一季度的業績包括穩健的增長指標和其他有希望的指標，這些指標表明對醫療保健服務的核心需求正在回歸，並且我們正在通過我們的計劃和投資取得進展以獲取數量。

Some other more challenging dynamics such as payer mix changes and increased medical specialist fees affected our earnings in the quarter despite our ability to favorably manage other controllable expenses. Over the past few quarters, we have been sharing updates on our near-term priorities, which include specific tactics and resources designed to accelerate growth, strengthen the workforce, control expenses and advanced safety and quality. During my remarks today, I want to touch on these priorities and the results we are achieving, starting with our determination to accelerate growth.

儘管我們有能力有利地管理其他可控費用，但其他一些更具挑戰性的動態（例如付款人組合變化和醫療專家費用增加）影響了我們本季度的收益。在過去的幾個季度中，我們一直在分享我們近期優先事項的最新情況，其中包括旨在加速增長、加強員工隊伍、控制開支以及提高安全性和質量的具體策略和資源。在今天的發言中，我想談談這些優先事項和我們正在取得的成果，首先是我們加快增長的決心。

We experienced strong volume gains during the first quarter as consumers increasingly return to health care setting now that COVID-19 has substantially subsided. Key volume metrics improved on a year-over-year basis, and they improved sequentially, continuing positive trends from the fourth quarter. Same-store admissions increased by 4.8%, and adjusted admissions increased 9.4% year-over-year. Same-store surgery showed particular strength, increasing 10.6% with broad-based gains in orthopedics, cardiovascular, GI, urology and gynecology. Growth in these specialties, along with the continued positive impact of our transfer center service resulted in medical and surgical case mix index improvements sequentially and growth in non-COVID acuity year-over-year.

由於 COVID-19 已經大幅消退，消費者越來越多地回到醫療保健環境，我們在第一季度經歷了強勁的銷量增長。關鍵數量指標同比有所改善，並且連續改善，延續了第四季度以來的積極趨勢。同店入場人數增長 4.8%，調整後入場人數同比增長 9.4%。同店手術顯示出特別的優勢，增長了 10.6%，骨科、心血管、胃腸道、泌尿科和婦科的廣泛增長。這些專業的增長，以及我們的轉運中心服務的持續積極影響，導致醫療和外科病例組合指數連續改善，非 COVID 敏銳度同比增長。

Capital investments designed to further develop our strongest markets are positively impacting growth in both inpatient and outpatient services. Recent examples include the full opening of a 112-bed expansion in our Naples, Florida health system as well as the opening of a new ambulatory surgery center and a freestanding ER in our Birmingham, Alabama market. Major bed expansions and facility improvements are underway in other markets such as Foley, Alabama; Warsaw, Indiana, which is part of our Lutheran Health Network and Knoxville, Tennessee. A number of other investments that are designed to fuel growth continue across the portfolio. Provider recruitment remains key to growth and further expansion of service lines in our markets. To that end, we continue to post favorable gains on the heels of a very strong 2022 recruitment year.

旨在進一步開發我們最強大市場的資本投資對住院和門診服務的增長產生了積極影響。最近的例子包括我們在佛羅里達州那不勒斯的衛生系統全面開放 112 個床位的擴建項目，以及在阿拉巴馬州伯明翰市場開設一個新的門診手術中心和一個獨立的急診室。阿拉巴馬州弗利等其他市場正在進行床位擴建和設施改進；印第安納州華沙是我們路德會健康網絡的一部分，田納西州諾克斯維爾。許多旨在推動增長的其他投資在整個投資組合中繼續進行。供應商招聘仍然是我們市場服務線增長和進一步擴展的關鍵。為此，我們在非常強勁的 2022 年招聘年之後繼續取得可觀的收益。

Strengthening our workforce is a constant priority and we are pleased with continued progress in this area. After its first full year of operation, our centralized nurse recruitment function continues to perform extremely well with strong mid-single-digit gains in the higher end of nurses in the first quarter compared to the fourth quarter of last year. Due to the success of our centralized recruitment resources, we are in the process of expanding the scope to include sourcing and hiring of all clinical positions, not just nursing. Our partnership with Jersey College School of Nursing will expand again when our eighth program opens in our Tennova East Tennessee market later this month. Eventually, through this initiative, we expect to graduate 1,000 new nurses every year. And we remain focused on a variety of programs designed to strengthen retention rates as well.

加強我們的員工隊伍是一項始終如一的優先事項，我們對這一領域的持續進展感到高興。在第一個全年運營之後，我們的集中護士招聘功能繼續表現非常出色，與去年第四季度相比，第一季度高端護士的收入實現了強勁的中個位數增長。由於我們集中招聘資源的成功，我們正在擴大範圍以包括所有臨床職位的採購和僱用，而不僅僅是護理。本月晚些時候，當我們的第八個項目在我們的 Tennova East Tennessee 市場開放時，我們與 Jersey College School of Nursing 的合作關係將再次擴大。最終，通過這一舉措，我們預計每年將有 1,000 名新護士畢業。我們仍然專注於旨在提高保留率的各種計劃。

We ended the first quarter with an improvement of approximately 500 basis points and nursing turnover rates on top of the significant gains in 2022. Advancing safety and quality remains one of our most important. Last quarter, we highlighted our work over the past decade to reduce serious safety events noting an impressive 87.9% reduction in our serious safety event rate since the baseline established in 2013. That improvement is now 89% and a testament to the commitment of our medical professionals, caregivers, support teams and health system leaders. I want to take a moment to express my gratitude for what they do every day to ensure safe quality care for their patients. And CHS recently was ranked #1 among the top 30 U.S. health care systems for online reputation, a distinction that is the result of positive online ratings and reviews for our health care providers and services, along with a high level of responsiveness to the voice of the customer.

第一季度結束時，除了 2022 年的顯著增長外，我們還提高了約 500 個基點和護理人員流動率。提高安全和質量仍然是我們最重要的工作之一。上個季度，我們強調了過去十年來我們在減少嚴重安全事件方面所做的工作，注意到自 2013 年建立基準以來，我們的嚴重安全事件發生率顯著降低了 87.9%。現在這一改善是 89%，這證明了我們的醫療承諾專業人士、護理人員、支持團隊和衛生系統領導者。我想花點時間感謝他們每天所做的一切，以確保為患者提供安全優質的護理。 CHS 最近在美國前 30 名醫療保健系統的在線聲譽中排名第一，這是對我們的醫療保健提供者和服務的積極在線評級和評論以及對聲音的高度響應的結果。客戶。

We use those insights to continuously improve and we know a strong online reputation helps cultivate new patient acquisition and loyalty. This is our second year in a row to achieve this top ranking. Through targeted investments in innovative technologies to improve outcomes, we continue to see positive results in clinical quality and customer experience. These programs include virtual sitters for patients at high risk for falls, maternal fetal monitoring technology that enables earlier interventions when needed in labor and delivery and the current rollout of at-home remote patient monitoring for individuals with chronic health conditions. We are also in discussions with other potential innovation partners that offer clinical technologies to further advance patient care and that have the potential to generate returns for our company in the years ahead.

我們利用這些見解不斷改進，我們知道強大的在線聲譽有助於培養新患者的獲取和忠誠度。這是我們連續第二年獲得這一最高排名。通過對創新技術進行有針對性的投資以改善結果，我們繼續在臨床質量和客戶體驗方面取得積極成果。這些項目包括為高跌倒風險患者提供虛擬保姆、可在分娩和分娩需要時進行早期干預的產婦胎兒監測技術，以及目前推出的針對慢性病患者的居家遠程患者監測。我們還在與其他潛在的創新合作夥伴進行討論，這些合作夥伴提供臨床技術以進一步推進患者護理，並有可能在未來幾年為我們公司帶來回報。

In summary, despite the persistent pressures on near-term margins, our team continues to prioritize and position the organization for growth, successfully deliver upon key initiatives to improve operations and advance the long-term competitive position of our health systems. As a result, we expect to make incremental progress both throughout the year and for the longer-term.

總而言之，儘管近期利潤率持續面臨壓力，但我們的團隊繼續優先考慮和定位組織的增長，成功實施關鍵舉措以改善運營並提升我們衛生系統的長期競爭地位。因此，我們希望在全年和長期內取得漸進式進展。

Kevin, I'll now turn the call over to you.

凱文，我現在把電話轉給你。

Thank you, Tim, and good morning, everyone. As Tim mentioned, we were very pleased with the volume results we achieved in the first quarter and remain optimistic about 2023 and thereafter. Year-over-year, our top line was pressured by the COVID comp and sequentially by payer mix, while increases in some nonlabor expenses impacted our adjusted EBITDA. However, the sequential improvements we have seen in key volume metrics. And what we see as a return in core demand for health care services are encouraging as we move through 2023. Further, we remain focused on improvements in our workforce and expense management to moderate the impact of inflation.

謝謝蒂姆，大家早上好。正如蒂姆所提到的，我們對第一季度取得的銷量結果感到非常滿意，並對 2023 年及以後保持樂觀。與去年同期相比，我們的收入受到 COVID comp 的壓力，隨後受到付款人組合的壓力，而一些非人工費用的增加影響了我們調整後的 EBITDA。但是，我們在關鍵數量指標中看到的連續改進。隨著我們邁向 2023 年，我們認為對醫療保健服務核心需求的回歸令人鼓舞。此外，我們仍然專注於改善我們的勞動力和費用管理，以緩和通貨膨脹的影響。

Now let me discuss the first quarter results. Net operating revenues came in at $3,108 million on a consolidated basis. On a same-store basis, net revenue was up 1.7% compared to the first quarter of 2022. This was the net result of a 9.4% increase in adjusted admissions and a 7.1% decrease in net revenue per adjusted admission, which, as noted, was a result of higher prevalence of COVID admissions during the first quarter of 2022 and an outsized growth of governmental volume compared to growth in commercial volumes. On a sequential basis, net revenue per adjusted admission decreased by only 60 basis points and was also caused primarily by a shift in payer mix as Medicare managed care adjusted admissions accounted for all of the sequential growth.

現在讓我討論第一季度的結果。綜合淨營業收入為 31.08 億美元。在同店基礎上，淨收入比 2022 年第一季度增長 1.7%。這是調整後入場人數增加 9.4% 和調整後入場淨收入減少 7.1% 的淨結果，如前所述，這是由於 2022 年第一季度 COVID 入院率較高，以及與商業交易量增長相比，政府交易量增長過快。按順序計算，每次調整後的入院淨收入僅下降了 60 個基點，這也主要是由於 Medicare 管理的護理調整後的入院人數佔所有連續增長的原因，付款人組合發生了變化。

Adjusted EBITDA was $335 million with an adjusted EBITDA margin of 10.8%. During the first quarter, we recorded an immaterial amount of pandemic relief funds compared to the $47 million recognized in the prior year period. Going forward, we do not expect to receive or recognize any material pandemic relief funds from the government. With regard to expenses, on the labor expense side, combined salaries, wages and benefits and contract labor expense improved on a year-over-year basis by approximately $65 million. On a sequential basis, combined SWB and contract labor increased approximately $13 million.

調整後的 EBITDA 為 3.35 億美元，調整後的 EBITDA 利潤率為 10.8%。在第一季度，與去年同期確認的 4700 萬美元相比，我們記錄了微不足道的大流行病救助資金。展望未來，我們預計不會收到或承認來自政府的任何物質大流行救助資金。在費用方面，在人工費用方面，綜合工資、工資和福利以及合同人工費用同比增加約 6500 萬美元。按順序計算，SWB 和合同工合計增加了約 1300 萬美元。

Specifically related to employee costs, we experienced an increase of 5.9% in our average hourly rate for employees on a year-over-year basis. However, total salary and benefit expenses on a same-store basis increased by a lesser amount of 5.4% demonstrating our ability to offset inflation and cost of increased hiring with productivity gains. On contract labor expense, we made significant progress over the prior year reducing the expense by over 54%. Compared to the fourth quarter of '22, our contract labor expense increased slightly from $80 million in the fourth quarter to $85 million in the first quarter. As a reminder, our contract labor was $190 million in the first quarter of 2022. With the additional advances we expect to make with nurse hiring, we anticipate continued progress reducing contract labor throughout the remainder of 2023.

具體與員工成本相關，我們的員工平均時薪同比增長了 5.9%。然而，同店工資和福利支出總額增加了 5.4%，這表明我們有能力通過提高生產率來抵消通貨膨脹和增加招聘的成本。在合同工費用方面，我們比上一年取得了重大進展，減少了 54% 以上的費用。與 22 年第四季度相比，我們的合同工費用從第四季度的 8000 萬美元略微增加到第一季度的 8500 萬美元。提醒一下，我們的合同工在 2022 年第一季度為 1.9 億美元。隨著我們預計在護士招聘方面取得的額外進展，我們預計在 2023 年剩餘時間內減少合同工方面將繼續取得進展。

On nonlabor-related expenses, while we have been effectively managing these expenses over the last several quarters, during the first quarter of 2023, we experienced a $40 million year-over-year increase in medical specialist fees and a $20 million year-over-year increase in professional liability expense, which were not mitigated by other reductions. These 2 items contributed to an increase of approximately 6.9% in nonlabor expenses over the prior year. Sequentially, medical specialist fees increased $14 million. We continue to execute on our cost reduction initiatives, including supply chain management and our margin improvement program to prudently manage nonlabor-related expenses going forward.

在非人工相關費用方面，雖然我們在過去幾個季度一直在有效地管理這些費用，但在 2023 年第一季度，我們的醫療專家費用同比增長 4000 萬美元，醫療專家費用同比增長 2000 萬美元年專業責任費用的增加，這並沒有被其他減少所抵消。這兩項導致非人工費用較上年增長約 6.9%。隨後，醫療專家費用增加了 1400 萬美元。我們繼續執行我們的成本削減計劃，包括供應鏈管理和我們的利潤率提高計劃，以審慎管理未來的非勞動力相關費用。

Moving to cash flows. Cash flows provided by operations were $5 million for the first quarter of 2023 compared to $101 million for the first quarter of 2022. The timing of certain payments, including incentive compensation, the settlement of certain professional liability claims and accounts payable led to lower cash flows during the quarter. We expect we will recapture these cash flows in future quarters.

轉向現金流。 2023 年第一季度運營產生的現金流量為 500 萬美元，而 2022 年第一季度為 1.01 億美元。某些付款的時間安排，包括激勵補償、某些專業責任索賠和應付賬款的結算，導致現金流量減少在本季度。我們預計我們將在未來幾個季度重新獲得這些現金流。

Turning to CapEx. For the first quarter of 2023, our CapEx was $122 million compared to $97 million in the prior year period. The increase in the first quarter of 2023 was due primarily to the timing of payments related to several growth projects that are in flight. Company's net debt-to-EBITDA is currently 8.3x and due mostly to lower trailing 12-month EBITDA, which still includes periods of disruptive care from the prior year. As we manage through this environment, we remain focused on our longer-term goals of lowering our leverage and increasing our free cash flow. We retained $144 million of cash on the balance sheet at the end of the first quarter, and we have approximately $800 million of borrowing base capacity available under our ABL. As such, we have adequate liquidity to meet our needs going forward.

轉向資本支出。 2023 年第一季度，我們的資本支出為 1.22 億美元，而去年同期為 9700 萬美元。 2023 年第一季度的增長主要是由於與幾個正在進行的增長項目相關的付款時間安排。公司的淨債務與 EBITDA 的比率目前為 8.3 倍，主要是由於過去 12 個月的 EBITDA 較低，其中仍包括上一年的破壞性護理期。在我們應對這種環境時，我們仍然專注於降低杠桿率和增加自由現金流的長期目標。截至第一季度末，我們在資產負債表上保留了 1.44 億美元的現金，我們的 ABL 下有大約 8 億美元的借貸基礎能力。因此，我們有足夠的流動性來滿足我們未來的需求。

As we assess the opportunities to evolve our portfolio for growth and success, we continue to evaluate interest from outside parties related potential divestitures as well as considering opportunities to expand our portfolio. As these opportunities emerge, we analyze the future growth and earnings profile of specific assets and assess the impact of potential transactions would have on our future EBITDA, financial leverage and free cash flow generation. During the quarter, we received $92 million of cash proceeds from the sale of our last remaining facility in West Virginia, which closed on April 1, 2023. We also signed an agreement to sell our 2 facilities in North Carolina, which remains subject to regulatory approval.

在我們評估發展我們的投資組合以實現增長和成功的機會時，我們繼續評估與潛在資產剝離相關的外部各方的興趣，並考慮擴大我們的投資組合的機會。隨著這些機會的出現，我們分析特定資產的未來增長和盈利狀況，並評估潛在交易對我們未來 EBITDA、財務槓桿和自由現金流產生的影響。在本季度，我們從西弗吉尼亞州最後一個剩餘設施的出售中獲得了 9200 萬美元的現金收益，該設施於 2023 年 4 月 1 日關閉。我們還簽署了一項協議，出售我們在北卡羅來納州的 2 個設施，該設施仍受監管贊同。

In addition, following the end of the quarter, we signed a definitive agreement to sell our facility in El Dorado, Arkansas. We remain engaged in continuing discussions about other potential transactions, which if they come to fruition, could provide opportunities to pay down debt as well as allow opportunities to reinvest resources to areas of our portfolio to further accelerate their long-term growth in earnings.

此外，在本季度末，我們簽署了最終協議，出售我們在阿肯色州埃爾多拉多的設施。我們將繼續參與有關其他潛在交易的持續討論，如果這些交易得以實現，可能會提供償還債務的機會，並提供機會將資源重新投資到我們投資組合的領域，以進一步加速其長期收益增長。

In summary, we remain optimistic about 2023. We are encouraged by the progress we are seeing and the indicators that demonstrate that core demand for health care services is returning. We remain committed to our objectives to position the company for long-term and sustainable success and are focused on executing on opportunities for growth in our markets.

總而言之，我們對 2023 年仍然持樂觀態度。我們對所看到的進展以及表明對醫療保健服務的核心需求正在恢復的指標感到鼓舞。我們仍然致力於實現我們的目標，使公司定位於長期和可持續的成功，並專注於抓住我們市場增長的機會。

Kelly, at this point, I'll turn the call back to you.

凱利，在這一點上，我會把電話轉回給你。

Thank you, Kevin. Jamie, we're ready to open the call for questions.

謝謝你，凱文。傑米，我們準備好開始提問了。

(Operator Instructions) Our first question today comes from Ben Hendrix from RBC Capital Markets.

（操作員說明）我們今天的第一個問題來自 RBC Capital Markets 的 Ben Hendrix。

I wonder if you could dig into the commercial mix progression we saw sequentially versus what you had in your expectations, kind of what you believe accounts for any of the divergence and how we should think about the pace of recovery to the reaffirmed guidance?

我想知道您是否可以深入研究我們連續看到的商業組合進展與您的預期，您認為是什麼導致了任何差異，以及我們應該如何考慮恢復到重申指導的步伐？

Sure. Yes, absolutely. So as we expected -- we expect the first quarter to step backwards a little bit. Certainly, some of that we anticipated some payer mix shift, largely due to some of the economic pressures, inflation and the pressure that has on household incomes. If you think about patients with high co-pays and deductibles that would be most impacted by the pressure on household income. Those are the commercial patients, whereas government patients have lower co-pays and deductibles and MA patients often have 0 co-pay and deductible. So we did expect some pressure there. What we saw sequentially was substantially all of the increase in volume was from MA patients, and we did not expect it to be that -- that much weighted towards the MA plans in the first quarter.

當然。是的，一點沒錯。因此，正如我們預期的那樣——我們預計第一季度會有所倒退。當然，我們預計其中一些付款人組合會發生變化，這主要是由於一些經濟壓力、通貨膨脹和對家庭收入的壓力。如果您考慮那些受家庭收入壓力影響最大的共付額和免賠額較高的患者。這些是商業患者，而政府患者的共付額和免賠額較低，而 MA 患者的共付額和免賠額通常為 0。所以我們確實預計會有一些壓力。我們依次看到的是，幾乎所有增加的數量都來自 MA 患者，我們沒想到會如此——第一季度對 MA 計劃的重視程度如此之高。

Our next question comes from Brian Tanquilut from Jefferies.

我們的下一個問題來自 Jefferies 的 Brian Tanquilut。

Guys, can you hear me okay?

伙計們，你能聽到我說話嗎？

Yes, we can now.

是的，我們現在可以。

All right, sorry about that. Yes, I guess my question just surrounds around labor, right? I mean obviously, picked up a little bit here, even in contract labor as we see bill rates in a temp staff go down, is that something that we should be thinking about as we think about or contemplate Q2, Q3 trends, just on that specific line item. And maybe taking it a step further. I just -- I know you had a higher-than-expected inflation rate for labor in Q1. What would bring that down over the course of the year?

好吧，對此感到抱歉。是的，我想我的問題只是圍繞著勞動，對吧？我的意思是，很明顯，即使在合同工中，我們看到臨時工的賬單費率下降，這裡也有所回升，這是我們在思考或考慮第二季度、第三季度趨勢時應該考慮的事情，就在這一點上具體行項目。也許更進一步。我只是——我知道第一季度的勞動力通脹率高於預期。在這一年中什麼會降低它？

Sure. So I'll try to capture both of those, Brian. Thanks for the question. As it relates to contract labor, a couple of things I'd point out maybe a little bit different than last year not unexpected. So more of the hiring that we're doing, particularly in the first quarter are new grads. Last year, as we began hiring in our nurse recruiting -- centralized nurse recruiting function, which we just anniversaried this past April. We were repatriating many of the nurses who had previously left our facilities to become travel nurses. And so the time period for those nurses to get back up and running was a little bit shorter as opposed to more new graduates or new nurses being hired today that have a little bit longer lead in time. So that may delay us slightly in taking out some of the contract labor. We had great success during the first quarter in terms of nurse hiring.

當然。所以我會嘗試捕捉這兩個，布賴恩。謝謝你的問題。由於涉及合同工，我要指出的幾件事可能與去年略有不同，這並不意外。因此，我們正在做的更多招聘，尤其是在第一季度，是應屆畢業生。去年，當我們開始在我們的護士招聘中招聘時——集中的護士招聘功能，我們剛剛在今年 4 月舉行了周年紀念活動。我們正在遣返許多以前離開我們設施成為旅行護士的護士。因此，與今天僱用的更多新畢業生或新護士相比，這些護士恢復正常運轉的時間要短一些，而這些護士的準備時間要長一些。因此，這可能會稍微延遲我們取消一些合同工。第一季度，我們在護士招聘方面取得了巨大成功。

We expect that to continue with our centralized nurse recruiting function and do continue to -- or expect to continue to make progress throughout the year. We also are transitioning more contract labor nurses to international nurses, which also have a little bit longer lead time to get them up and fully integrated into their positions. But as we do that, we'll be able to take out some additional contract labor expense and that will also help mitigate some of that average hourly rate. As it relates to employee costs, we did experience, I mentioned, 5.9% inflation on an average hourly rate basis. We had previously indicated when we put out guidance that our assumption was 5% wage inflation for the year. So we were slightly above that. But as we think about the rate increases that we gave throughout 2022, which I don't think will continue throughout 2023.

我們希望繼續我們集中的護士招聘功能，並繼續 - 或者期望在全年繼續取得進展。我們還正在將更多的合同工護士轉變為國際護士，這也有更長的準備時間讓他們站起來並完全融入他們的崗位。但當我們這樣做時，我們將能夠減少一些額外的合同工費用，這也將有助於降低部分平均小時費率。由於它與員工成本有關，我提到過，我們確實經歷過平均每小時 5.9% 的通貨膨脹。我們之前在發布指引時曾表示，我們的假設是今年的工資通脹率為 5%。所以我們略高於那個。但是當我們考慮我們在整個 2022 年給出的加息時，我認為這不會持續到整個 2023 年。

I think we'll actually be able to bring that wage inflation down in some of the future quarters in the back half of the year, so that the average of 5% for the year is still where we think we'll be. And I think last point I'd just make on that is with the productivity gains, that we had, despite the 5.9% wage inflation, we overpaying the hiring additional hiring and gain productivity so that our actual same-store SWB was only up 5.4% from the prior year.

我認為我們實際上能夠在今年下半年的未來幾個季度降低工資通脹率，因此全年 5% 的平均水平仍然是我們認為的水平。我想我要說的最後一點是生產力的提高，儘管工資上漲了 5.9%，但我們多付了額外的招聘費用並提高了生產力，因此我們實際的同店 SWB 僅增長了 5.4與上一年相比的百分比。

Our next question comes from A.J. Rice from Crédit Suisse.

我們的下一個問題來自 A.J.來自 Crédit Suisse 的大米。

I wanted to just ask a little more on the expense side in 2 ways. The managed care recontracting you're doing at this point, are you seeing any bump in -- to cover some of the inflationary pressures, both labor and otherwise that you're experiencing? And then specifically because you called out the hospital-based physicians, I guess, professional fees. Where specifically is that? Is that ER management, anesthesia or other areas? And what's the prospect for improving that trend over the course of this year? Is there anything -- are you just assuming it's going to stay at this elevated level? Or can you improve that?

我想通過兩種方式在費用方面多問一點。你現在正在做的管理式醫療重新合同，你是否看到任何衝擊 - 以彌補你正在經歷的一些通貨膨脹壓力，包括勞動力和其他方面？然後特別是因為你召集了醫院的醫生，我猜，專業費用。那具體是哪裡？是急診室管理、麻醉還是其他領域？今年改善這一趨勢的前景如何？有什麼——你只是假設它會保持在這個較高的水平嗎？或者你能改進它嗎？

So let me start off and Tim, feel free to jump in if I miss something. So the medical specialist fees we are seeing some increases related to kind of the inflationary costs as well as the no surprise billing kind of impact from that is some of these physicians may have been terminated by the providers and now they're looking to recoup some of their billable revenue from us and from the providers. And I think that we're seeing that maybe across the industry. Our kind of profile of providers was primarily regional and local providers. So we do have an opportunity to in-source some of those doctors to renegotiate contracts to change out some of these contracts and maybe even some skill mix amongst those doctors.

所以讓我開始吧，蒂姆，如果我錯過了什麼，請隨時加入。因此，我們看到的醫療專家費用有所增加，這與通貨膨脹成本有關，而且毫無疑問，其中一些醫生可能已被提供者解僱，現在他們正在尋求收回一些費用。他們從我們和提供商那裡獲得的可計費收入。我認為我們可能在整個行業都看到了這一點。我們的供應商概況主要是區域和本地供應商。因此，我們確實有機會聘請其中一些醫生重新談判合同，以更改其中一些合同，甚至可能更改這些醫生之間的一些技能組合。

So we do have plans that we can mitigate some of that cost going forward, I do not expect it to stay at the current run rate that we saw in the first quarter. It did start to go up kind of mid-'22. So we saw increases in the third and fourth quarter. So at a minimum, we'll start to anniversary that in the back half of the year, so will not continue to be a year-over-year headwind in the back half of the year, but we do see opportunities to be able to bring some of that cost down on a quarterly run rate basis.

因此，我們確實有計劃可以降低未來的部分成本，我預計它不會保持在我們在第一季度看到的當前運行率。它確實在 22 年中期開始上漲。所以我們在第三和第四季度看到了增長。所以至少，我們將在今年下半年開始慶祝週年紀念日，所以下半年不會繼續成為同比逆風，但我們確實看到了能夠在季度運行率的基礎上降低部分成本。

Yes. And I'll just add. This is Tim. I'll go ahead and add a few comments to that. As Kevin said, we think the first quarter would be the peak of the medical specialist fee incremental increases. We've already had some new agreements put in place with alternative vendors at better pricing. There is a skill mix change, adapting hours of service, if you will, on the anesthesia side. which was, I would say, an overweight in terms of the proportional increase in the spend, all those things, I think, should start stabilizing as we head into the future quarters. I would also say that continuing our favorable growth rates increasing the numbers of surgeries and billable procedures for all of our hospital-based provider should also take away some of the fixed subsidies for their staffing and their overhead. So we think all those things in combination make it more manageable as we lead into the next few quarters.

是的。我只是補充一下。這是蒂姆。我將繼續並添加一些評論。正如凱文所說，我們認為第一季度將是醫療專科費用增量增長的高峰期。我們已經以更優惠的價格與替代供應商簽訂了一些新協議。有一個技能組合變化，調整服務時間，如果你願意的話，在麻醉方面。我想說，就支出的比例增長而言，這是一種超重，我認為，隨著我們進入未來幾個季度，所有這些事情都應該開始穩定下來。我還要說的是，繼續保持我們有利的增長率，增加我們所有醫院提供者的手術和計費程序的數量，也應該取消他們的人員配置和管理費用的一些固定補貼。因此，我們認為所有這些因素結合起來，使我們在接下來的幾個季度中更易於管理。

Our next question comes from Kevin Fischbeck from Bank of America.

我們的下一個問題來自美國銀行的 Kevin Fischbeck。

Okay. Great. I just want to dig into this mix shift -- fair mix shift a little bit more because it's not clear to me exactly how it explained contributed to the pricing. Can you just maybe disaggregate exactly how much was that versus some of the things you mentioned COVID impacts? And in particular, if this is an MA dynamic. Can you just remind us how -- what the rate differential is between MA and fee-for-service? And if it is MA, then is this going to be a long-term headwind? Why is this not something that would continue to your pressure on rates going forward?

好的。偉大的。我只想深入研究這種混合轉變——公平混合轉變多一點，因為我不清楚它到底是如何解釋對定價的貢獻的。您能否將這與您提到的 COVID 影響的某些事情進行確切的分解？特別是，如果這是 MA 動態。您能否提醒我們 - MA 和按服務收費之間的費率差異是多少？如果是 MA，那麼這將是一個長期的不利因素嗎？為什麼這不會繼續對你的利率施加壓力？

Yes. So if I think about kind of year-over-year, about 2/3 of our growth in volume year-over-year related to governmental payers. And of that, probably 2/3 of the governmental growth was Medicare and primarily MA versus Medicaid. So that's kind of the breakout kind of year-over-year on a volume basis. Of course, the other factors our acuity and rate lift, which we got our best rate lift in commercial. So as you think about kind of proportional revenue, it doesn't quite flow with those because of the rate lift we get in commercial. But volume again year-over-year, about 2/3 government, 1/3 of commercial volume increases. Sequentially, all the increases were MA. And then to your question about kind of rate, we're seeing kind of between 85% and 90% payment for MA patients compared to Medicare fee-for-service.

是的。因此，如果我考慮同比增長，我們約有 2/3 的同比增長與政府支付者有關。其中，可能有 2/3 的政府增長來自醫療保險，主要是 MA 與醫療補助。所以這是一種按銷量計算的同比突破。當然，我們的敏銳度和提升率還有其他因素，我們在商業中獲得了最好的提升率。因此，當你考慮某種比例收入時，由於我們在商業中獲得的利率提升，它並沒有完全隨著這些收入流動。但交易量再次同比增長，約 2/3 的政府交易量和 1/3 的商業交易量增加。隨後，所有的增長都是 MA。然後關於您關於費率的問題，與 Medicare 按服務收費相比，我們看到 MA 患者支付的費用在 85% 到 90% 之間。

Yes, Kevin, this is Tim. I'll go ahead and add on to that. The commercial mix in the quarter was lighter proportionally to the growth in the governmental as Kevin points out, the first quarter is typically our lowest commercial mix quarter. So I kind of expected that coming into the quarter as people kind of hit their deductibles and co-pays with our stronger procedural -- commercial surgery volume in the fourth quarter kind of putting a little bit of a lag into the first quarter. As we look throughout the quarter, we did see as we normally do some improvements in the mix as we hit March and into April.

是的，凱文，這是蒂姆。我會繼續補充這一點。正如凱文指出的那樣，本季度的商業組合與政府部門的增長成正比，第一季度通常是我們最低的商業組合季度。因此，我有點預計進入本季度時，人們會因為我們更強的程序而達到他們的免賠額和共同支付——第四季度的商業手術量有點滯後於第一季度。當我們回顧整個季度時，我們確實看到我們通常會在進入 3 月和 4 月時對組合進行一些改進。

So again, we expect some of that to normalize. But in terms of the absolute growth in MA volumes, we have to be more disciplined and determined in our approaches to targeting a more, I guess, I'll say, balanced or a better balance commercial mix. We're doing that through access point strategies to our service line development, of OB and NICU and trauma programs, deeper investments in cardiac service lines, which tend to attract, I think, a better mix from an age perspective. And we're also working on some very specific direct-to-employer strategies, including some direct-to-employer contracting models. So looking forward to kind of rolling that out in the quarters ahead as well.

因此，我們再次希望其中一些能夠正常化。但就 MA 數量的絕對增長而言，我們必須更加自律和堅定我們的目標，我想，我會說，平衡或更好的平衡商業組合。我們正在通過接入點戰略來實現我們的服務線發展，OB 和 NICU 以及創傷計劃，對心臟服務線的更深入投資，我認為，從年齡的角度來看，這往往會吸引更好的組合。我們還在研究一些非常具體的直接面向雇主的策略，包括一些直接面向雇主的合同模式。因此，期待在未來幾個季度也能將其推出。

And maybe just to add one more point, and thanks for that, Tim. Our expectation, as we mentioned, was first quarter was going to step backwards and would be the lowest quarter of the year. We would grow sequentially kind of throughout the year from an EBITDA standpoint. Part of that is because of the pressure on commercial business that we had anticipated. We do think that, that's magnified by inflation in the economy. But likewise, we think in the back half of the year, as people try to get more of their procedures in before their co-pays and deductibles reset, that's again in the following year. We think that, that recovery in the back half of the year will also be magnified.

也許只是再補充一點，謝謝蒂姆。正如我們所提到的，我們的預期是第一季度將倒退，並將成為今年最低的季度。從 EBITDA 的角度來看，我們將在全年連續增長。部分原因是我們預期的商業業務壓力。我們確實認為，經濟中的通貨膨脹會放大這種情況。但同樣，我們認為在今年下半年，隨著人們試圖在他們的共付額和免賠額重置之前完成更多的程序，這將在下一年再次發生。我們認為，下半年的複蘇也將被放大。

Our next question comes from Josh Raskin from Nephron Research.

我們的下一個問題來自 Nephron Research 的 Josh Raskin。

Just want to talk about the guidance, the reiteration there. Even the low end of guidance, the $1.475 billion would be up about 14% year-over-year ex the grant income. 1Q was down 7.5%. So rest of year, up 22% plus. I'm just trying to figure out the drivers of that increase. It doesn't seem like a revenue issue. So it seems as though some of these costs have to dissipate on an absolute basis, not even on a percentage of. So maybe you could just help us first with some of the buckets there.

只想談談那裡的指導和重申。即使是指導的低端，14.75 億美元也將比撥款收入增長約 14%。第一季度下降了 7.5%。所以在今年剩下的時間裡，增長了 22% 以上。我只是想弄清楚這種增長的驅動因素。這似乎不是收入問題。因此，似乎其中一些成本必須在絕對基礎上消散，甚至不是按百分比消散。所以也許你可以先幫我們拿一些水桶。

Yes. On a year-over-year basis, we're -- certainly a big piece of that is contract labor. So there's going to be an absolute reduction in contract labor year-over-year that should flow through. And then we do expect the volume that we're seeing in the return of demand for health care services to drive revenue. And then there is some moderation in the -- other cost moderation in SWB that we expect and then continued margin improvement program efforts that we're taking and have been working on for a couple of years, and we still think there's a runway to be able to moderate our other operating expenses below inflation that we can then leverage to more EBITDA.

是的。與去年同期相比，我們 - 當然其中很大一部分是合同工。因此，合同工將逐年絕對減少，這應該會發生。然後我們確實希望我們在醫療保健服務需求回歸中看到的數量能夠推動收入。然後我們預期 SWB 的其他成本會有所緩和，然後我們正在採取並已經進行了幾年的利潤率改善計劃繼續努力，我們仍然認為有一條跑道能夠將我們的其他運營費用降至低於通貨膨脹率，然後我們可以利用這些費用來獲得更多的 EBITDA。

We'll also have the benefit of some of the investment projects that we've worked on over the past couple of years, getting a fuller benefit of those. And as we think about -- we opened up a de novo hospital in June of last year that we'll have a full year of operations. This year, there are a number of things that are driving that growth, Josh.

我們還將受益於我們在過去幾年中開展的一些投資項目，並從中獲得更充分的利益。正如我們所想的那樣——我們在去年 6 月開設了一家新醫院，我們將進行一整年的運營。今年，有很多因素推動了這種增長，Josh。

Would you orient us to the lower end of guidance at this point? Is that prudent? Or you still feel comfortable with the midpoint?

在這一點上，您是否會將我們定位到指導的低端？這是謹慎的嗎？或者您仍然對中點感到滿意？

No. At this point, we still feel comfortable at the midpoint. The [mix] between our actual results and consensus is bigger than the mix between our actual results and what we had anticipated for the first quarter. So as we think about where we're at compared to where we expected to be, we're not as far off as consensus would suggest. And so therefore, getting back to the midpoint, we still feel comfortable with.

不。在這一點上，我們仍然對中點感到滿意。我們的實際結果與共識之間的 [混合] 大於我們的實際結果與我們對第一季度的預期之間的混合。因此，當我們考慮我們所處的位置與我們預期的位置相比時，我們並沒有像共識所暗示的那樣遙遠。因此，回到中點，我們仍然感到舒服。

And then last one, if I could sneak it in. Are you thinking about additional asset sale opportunities? Is that more of a priority today? I heard in the preamble that you're still getting inbound interest, but are you prioritizing your asset sales more than you would have in the past?

然後是最後一個，如果我能偷偷說的話。你在考慮額外的資產出售機會嗎？這在今天更重要嗎？我在序言中聽說您仍在獲得入境興趣，但您是否比過去更優先考慮資產銷售？

I'm not sure I'd say more than we have in the past given that we went through several years of a very formalized program. And then we did pause for a period during COVID, but we have completed a few smaller transactions recently. We do have the one announced in North Carolina, which is more sizable. And we do have some other interest that we're just currently in talks about. So if those -- as that interest comes in and if those do come to fruition and are at prices that are accretive or allow us to reduce our leverage and/or accretive to our margin profile, our future cash generation, we do take a hard look at those.

鑑於我們經歷了幾年的非常正式的計劃，我不確定我會說比過去更多的事情。然後我們確實在 COVID 期間暫停了一段時間，但我們最近完成了一些較小的交易。我們確實在北卡羅來納州宣布了一個規模更大的項目。我們確實有一些我們目前正在討論的其他興趣。因此，如果這些——隨著這種興趣的出現，如果這些確實實現了，並且價格能夠增加或允許我們降低杠桿率和/或增加我們的利潤率，我們未來的現金產生，我們確實會採取措施看看那些。

Our next question comes from Jason Cassorla from Citi.

我們的下一個問題來自花旗銀行的 Jason Cassorla。

Great. The surgery growth number in the quarter definitely stood out over -- up over 10%. Can you talk about the drivers there and just help bifurcate between inpatient and outpatient surgery trend? And if that had any impact on mix in the quarter? And then importantly, just the durability and sustainability of those surgery growth trends would be helpful.

偉大的。本季度的手術增長數量絕對突出——增長超過 10%。你能談談那裡的驅動因素，只是幫助區分住院和門診手術趨勢嗎？如果這對本季度的組合有任何影響？然後重要的是，這些手術增長趨勢的持久性和可持續性會有所幫助。

Yes. So let me start. And then see if I get your question answered. In terms of kind of inpatient versus outpatient, I think we saw approximately 5% inpatient growth and double-digit outpatient growth in surgeries. We're still seeing some of that movement of inpatient to outpatient. I think that's slowing down a little bit. But our outpatient surgery growth certainly outpaced inpatient. But we did see acuity increase on both inpatient and outpatient.

是的。那麼讓我開始吧。然後看看我是否回答了你的問題。就住院病人和門診病人而言，我認為我們看到住院病人增長了大約 5%，門診手術病人增長了兩位數。我們仍然看到一些住院病人到門診病人的流動。我認為這正在放緩一點。但我們的門診手術增長肯定超過住院。但我們確實看到住院病人和門診病人的敏銳度都有所提高。

And I'll just add to that, Jason. In terms of where the volumes are coming from, we believe that's part of the investments we've made into not just physical capacity in some of our key markets, but also the recruitment of key specialists. We've talked for the last several quarters about the insights we gained from our transfer center service. I mean we can't say yes to accepting a patient from a non-CHS hospital. It helps us approximate certain demand to add higher acuity specialists to our networks. And we believe that's taking root in many of our tertiary markets in particular. But in any market, we've seen good growth in orthopedic services, again, some through recruitment, some through the return of those, I guess, I'll say, senior age, Medicare-aged patients in particular in the first quarter.

我會補充一點，傑森。就數量的來源而言，我們認為這是我們投資的一部分，不僅是我們在一些主要市場的實際產能，還有關鍵專家的招聘。在過去的幾個季度中，我們一直在談論我們從轉運中心服務中獲得的見解。我的意思是我們不能同意接受來自非 CHS 醫院的患者。它幫助我們估計某些需求，以將更高敏銳度的專家添加到我們的網絡中。我們相信這尤其在我們的許多三級市場紮根。但在任何市場，我們都看到了骨科服務的良好增長，一些是通過招聘，一些是通過返回那些，我想，我會說，老年人，特別是第一季度的醫療保險年齡患者。

We had a very robust orthopedic surgery quarter compared to prior year, but also beating almost every surgical stat to the pre-COVID baseline of 2019. So in general, I think we've built out good systems of care to drive not just sequential improvements in surgeries, but it's the area where we certainly are outshining the 2019 comp because of those deliberate investments.

與去年相比，我們的骨科手術季度表現非常強勁，而且幾乎所有手術統計數據都超過了 2019 年 COVID 前的基線。所以總的來說，我認為我們已經建立了良好的護理系統，不僅可以推動連續改進在外科手術中，但由於這些有意的投資，我們肯定在這個領域超越了 2019 年的競爭對手。

(Operator Instructions) Our next question comes from Stephen Baxter from Wells Fargo.

（操作員說明）我們的下一個問題來自 Wells Fargo 的 Stephen Baxter。

I was hoping you could remind us how you think cash flow plays out throughout the year. You're guiding to a pretty big increase in cash flow from ops, but didn't see much in the way of cash flow in the first quarter. just beyond the improving EBITDA performance throughout the year. I guess what else should we keep in mind in terms of working capital dynamics to get to that number?

我希望你能提醒我們你認為全年現金流如何發揮作用。您正在指導運營現金流量大幅增加，但第一季度的現金流量並沒有太大變化。僅次於全年 EBITDA 業績的改善。我想在營運資本動態方面我們還應該牢記什麼才能達到這個數字？

Sure. So yes, certainly, a portion of that is increasing EBITDA. But we did have, just from a timing of payments, respect some professional liability claim settlements in the first quarter and some accounts payable and compensation liabilities that we paid out. It didn't necessarily all run through the income statement because they were previously accrued. That should -- we should kind of recapture those in later quarters in the year. And we actually are anticipating some improvement from a working capital standpoint year-over-year. So that should all lead to improved cash flow from operations by the end of the year. .

當然。所以是的，當然，其中一部分正在增加 EBITDA。但我們確實有，僅從付款時間來看，尊重第一季度的一些專業責任索賠結算以及我們支付的一些應付賬款和賠償責任。它不一定全部貫穿損益表，因為它們以前是應計的。那應該 - 我們應該在今年晚些時候重新奪回那些。實際上，我們預計從營運資金的角度來看，同比會有一些改善。因此，到今年年底，這一切都應該會改善運營現金流。 .

And ladies and gentlemen, with that, we'll be concluding today's question-and-answer session. I would like to turn the floor back over to Tim for any closing remarks.

女士們先生們，我們將結束今天的問答環節。我想將發言權轉回給蒂姆，讓他發表任何結束語。

Great. Thanks, Jamie. I want to finish by noting that Nurses Week and Hospital Week will begin this coming weekend, 22,000 nurses work across our organization, and we appreciate every single 1 of them and all nurses everywhere. We also recognized the positive impact that CHS hospitals have in their communities and thank our entire team for what they do every day until people get well and live healthier. Thank you for joining today's call. If you have any additional questions, you can always reach us at (615) 465-7000.

偉大的。謝謝，傑米。最後，我想指出護士周和醫院週將於下週末開始，我們組織有 22,000 名護士工作，我們感謝他們中的每一位以及各地的所有護士。我們還認識到 CHS 醫院對其社區產生的積極影響，並感謝我們的整個團隊每天所做的一切，直到人們康復並生活得更健康。感謝您參加今天的電話會議。如果您有任何其他問題，可以隨時撥打 (615) 465-7000 與我們聯繫。

Ladies and gentlemen, with that, we'll be concluding today's conference call and presentation. We thank you for joining. You may now disconnect your lines.

女士們，先生們，我們將結束今天的電話會議和演講。我們感謝您的加入。您現在可以斷開線路。