Acadia Healthcare announced revenue of $616.8 million for the first quarter of 2016, an increase of 68.6% from Q1 of 2015. Growth was attributed to the full-quarter inclusion of approximately 4,100 beds added during 2015.
The company completed the previously announced acquisition of Priory Group in the United Kingdom with its 7,100 beds in 324 inpatient facilities, plus it added 330 new beds in the U.S. and the U.K. during the quarter. Acadia has increased its beds by approximately 9,000 over the 12 months ended March 31, 2016.
The upcoming change in Medicaid rules, which will allow reimbursement for short-term IMD services for Medicaid beneficiaries starting in July, will have favorable impact, according to company officials.
“We will be over the next 60 days redoubling our efforts to just let the referral sources know that the adult Medicaid patient can now be treated at a freestanding psych hospital,” said Joey Jacobs, chairman and chief executive officer, on the earnings call.
AAC Holdings, Inc. announced revenue increased 53% to $65.3 million, and average daily residential revenue was $832 compared with $974 for the comparable prior-year period.
In Q1, the company completed the acquisition of Townsend in Louisiana, adding a 32-bed in-network facility, seven in-network outpatient centers and an in-network lab, as well as the acquisition of Solutions Recovery in Las Vegas, adding 124 sober living beds, 80 licensed in-network detoxification, residential and halfway house beds, and two in-network outpatient centers. Additionally, AAC acquired a 100-room hotel in Arlington, Texas, for $5.35 million, which will be converted to sober living beds.
According to company officials on the earnings call, AAC had 892 beds at the end of Q1.
Legal expenses related to the California dependent adult abuse lawsuit had a negative impact on earnings per share, said Kirk Manz, chief financial officer, on the call. CEO Michael Cartwright reiterated that the company believes the charges are unfounded. Currently, the trial date is set for July 15, in Riverside County.
Additionally, AAC officials report they have expected revenue from lab services to decline, however, the lab business seems stable.
“There is no cliff it’s going to drop off of,” Cartwright said. “I know people like to paint that picture, but I don’t see that happening at all.”
Lab services are being expanded to include pharmacogenetics and hematology testing, which the company expects to ramp up in 2017.
Universal Health Services
Universal Health Services reported net revenues increased 10.1% to $2.45 billion during the first quarter of 2016 as compared to $2.23 billion during Q1 of 2015.
During Q1 of 2016, behavioral healthcare facilities on a same facility basis saw adjusted admissions increase 1.4% and net revenues increase 3.5%, as compared to the comparable quarter in 2015. The operating margins were 27.8% during the first quarter of 2016 and 28.4% during the first quarter of 2015.
“During the first quarter, we opened a total of 182 new behavioral health beds, including 57 beds opened at a new de novo hospital located in Oklahoma and 125 beds opened at some of our busiest facilities,” said Steve Filton, chief financial officer, on the earnings call. “Many behavioral health construction projects are underway, including six new de novo hospitals totaling 562 beds.”