Taking on COVID-19 patients and others with medically complex conditions has helped The Ensign Group buck trends in the industry and begin to stabilize occupancy, executives said as they reported another record quarter.
“While we have a long way to go, we like where we are the direction we’re headed,” Ensign CEO Barry Port said during a fourth quarter earnings call Thursday. “We believe when this pandemic is behind us that our operations are primed to rebuild occupancies and continue to gain additional market shares as a result of [our] deepened relationships with acute care providers and other healthcare partners.”
The operator saw “marked improvements” in patient volumes during the fourth quarter, particularly among medically complex and skilled patients. Port touted a Medicare census increase of 7.2% between the second and third quarters, which increased by another 10.8% between the third and the fourth quarters.
Port said the increase in Medicare census was the result of its operators’ efforts to take on higher acuity patients, including many COVID-positive admissions. The operator’s facilities admitted and cared for more than 5,000 COVID-positive patients during the fourth quarter, he said.
Additionally, more than 30% of its same-store operations have improved occupancy to over 80%, while in some markets, like Utah, the company saw entire clusters reach pre-COVID occupancy levels, according to Port.
“While occupancies are still lower than they were a year ago at this time, our results this quarter yet again show the resilience of our model and our local leaders’ ability to adapt to changing circumstances in their local healthcare markets,” Port said.
“This improvement in our admissions trends not only demonstrates that we can continue to perform well as the pandemic stubbornly persists but it also gives us insight into the post-pandemic environment and demonstrates that we are in an excellent position to see occupancies normalize to pre-pandemic levels — a pattern that we have noticed in some of our largest markets,” he added.
Mark Parkinson, president and CEO of the American Health Care Association, recently reported that national occupancy is around 67%, and said operators must recover census at a rate of about 1% per month in order for the industry to return to pre-pandemic levels.
The Ensign Group also reported a record adjusted earnings per share of 80 cents for the quarter — an increase of 33.3% over the prior year quarter and the highest ever reported in its history, according to Port. Its adjusted net income for the quarter was $44.9 million, an increase of 33.9% over the prior year quarter.
Port noted that this quarter’s results don’t include any benefit from Coronavirus Aid, Relief, and Economic Security Act (CARES) Act Provider Relief Funds and the operator has returned all funds it has received to date. Ensign returned about $109 million in provider grants in July, $33 million in the fourth quarter and $5 million in January.
“Our strong results from the quarter do not come from any one thing, but rather is the aggregation of continued improvements in skilled mix across the portfolio, improved admission trends, availability of more frequent and broader COVID testing, increased managed care volumes, cost-saving initiatives, improved cash collections, sequestration suspension and improved Medicaid funding in certain states,” Port said.
