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Select Medical Holdings Corporation (SEM) is a prominent healthcare services provider in the United States, operating since 1997. The company specializes in managing critical illness recovery hospitals, rehabilitation hospitals, outpatient rehabilitation clinics, and occupational health centers. SEM offers a wide range of healthcare services, including intensive physical rehabilitation, occupational health services, and consumer health services, across 46 states and the District of Columbia.
- Critical Illness Recovery Hospital - Operates hospitals that serve patients recovering from critical illnesses with complex medical needs, typically admitted from general acute care hospitals.
- Concentra - Provides occupational health services, physical therapy, and consumer health services through occupational health centers and contract services at employer worksites.
- Outpatient Rehabilitation - Offers physical, occupational, and speech rehabilitation services through a network of clinics.
- Rehabilitation Hospital - Manages hospitals providing intensive physical rehabilitation care, with patients usually admitted from general acute care hospitals.
- Given your plan to reduce SWB (Salaries, Wages, and Benefits) as a percentage of revenue to around 57% this year, what specific initiatives are you implementing to achieve further reductions next year, and how sustainable are these improvements?
- With the closure of an LTAC hospital in Ohio due to consolidation and noticing a reduction in your LTAC hospital count, what is your long-term strategy for the LTAC division, especially considering challenges with threshold levels and high-cost outliers?
- You have outlined significant capital expenditures, planning to add 569 additional beds through operations by 2026, primarily in the inpatient rehab division. How do you intend to finance these developments while maintaining your target leverage ratio of 3x, and what returns do you expect from these investments?
- In the outpatient rehab division, margins have improved due to efficiency efforts and technology implementation. Can you elaborate on how your internally developed system is enhancing clinical efficiency, and what impact do you expect this to have on future margins?
- Following the Concentra IPO and the planned distribution of your remaining interest to shareholders, how will the loss of Concentra's revenue and adjusted EBITDA impact your overall financial performance, and what strategies are in place to mitigate this effect?