All right, I think we're ready to get started. I'm glad you're here for the Addus HomeCare presentation. Welcome to everyone. My name is Matt Gilmore, and I lead healthcare equity research coverage for KeyBanc. Joining me on screen is Addus HomeCare CEO Dirk Allison, President Brad Bickham, and CFO Brian Poff. Addus is a leading provider of home care services, including personal care, home health, and hospice. The company operates over 200 locations across 22 states and cares for approximately 48,000 people every day. This will be a fireside chat format, so I'll be leading Q&A. Feel free to submit questions through the dialogue box. We'd be delighted to get them addressed. With that, Dirk and team, welcome, and thanks for joining us. Thanks, Brad. Thank you, Mr. Gilmore. You know I've been trying to start these conversations at a higher level before we kind of dig into financials and maybe some of the policy discussions even. I did sort of want to start off at that level. Maybe either Dirk or Brad or Brian, if you could start off by describing why it makes sense to have these three businesses together, what are some of the benefits you all get from the density that you've really purposefully created across your state markets? That'd be a great place to start off the conversation. You bet. Appreciate it, Matt. You know, if you go back a number of years, back to 2016, and that's when we, as a team, started to join as a management team of Addus, we were 100% personal care at that point in time. All of us had come from a clinical background. We had hospice in our background most recently. Some of us had home health in our background in prior years. You know, once we started looking at the personal care market, what we discovered in our mind was this was a great first entry into the home-based care. You know, we're one of the services that's the earliest in the home. We stay there between two and three years on average with every client, which we take care of. What we saw after a year or so was we felt like there were additional services in the home that we could offer that would be very beneficial to our clients and their families. When you think in terms of personal care, you look at our elderly and disabled population, our average age is probably between 75 and 80. These are individuals that, while they need help with the activities of daily living in their home each day, it's not unusual for them to have occasional need for home health. They may go into the hospital and come out and need home health services. Who can offer them that services? Can you keep them in the home? We thought this would be a great way to extend the care that we can give to our current families and clients. That is why we looked at home health. We obviously felt like that because of the age of our clients and the personal care side of our business, that in their future, there were going to be a number of them, a high percentage of them that would benefit by that most valuable service that we offer, which is hospice, which is, in our mind, one of the great services you can offer families as their family member goes through end of life. For us, it was a natural extension. Now, when we thought about that, it all starts with what you talked about, density in the state. We were not trying to be the largest in the United States. We were trying to be the largest in the states in which we operate, which stay about 23 states. Having geographic coverage gave us a lot of strength when we not so much negotiated rates with all of our services because most of our services have a stated rate, but it allowed us to have the coverage necessary to the payers, whether that's the state, whether it's MCOs, whoever that might be. It allowed us to take care of their members or their residents all across the state so they did not have to worry about, if we use Addus, they cannot service in this part of the state, but they can in others. We could service the entire market. That is really why we started with geographic density, adding these additional services on top. What we have found is there are great synergies between the three levels of care. We have a number of our home-based clients that we might serve either, let's say, home health, and then they move into hospice. We might have folks that we service home health and personal care. There are different avenues that we can service these clients, but we felt it made a lot of sense. Even though as these clients and patients move up the scale, they have choice, we thought by having them be familiar with Addus and the type of service we offer, the quality we try to perform each day, that it made sense to try to then work with them as they went up the scale on clinical services. That is really what led us to where we are today with our strategy. Got it. That makes a lot of sense. Your guys' tenure in terms of running the company has really been pretty remarkable in terms of performance of the business over the last six years. I did want to sort of transition to a sort of state of the union and maybe looking forward a little bit. You're coming off a strong 2024 and same-store revenue growth again over the high end of your long-term outlook. That translated into some nice EBITDA growth. You've also made some improvement to the portfolio in terms of exiting New York and the Gentiva acquisition that you recently closed. I thought we might do a quick kind of retrospective in terms of what have been some of the items driving the stronger performance in 2024. As we look ahead, what are some of the expectations you have for 25 in terms of same-store revenue growth and pricing and the labor environment that ultimately kind of roll up into the EBITDA for the company? Why don't I start off just the general, and then you guys can talk about labor and some of the other things. You know, I think 24 was a good year for us. We had great support from our states. Our operations team did a great job in trying to work their way through redeterminations, which while redeterminations that the states had to go through was not a direct impact, as big a direct impact as a lot of healthcare services were affected by. If you look at us, it was more the fact that the states had to take their time to do redeterminations as opposed to, especially in the personal care world, looking at new patients, looking at new consumers, going out and actually doing the assessment on site, determining how many authorized hours they were going to give us and then pass them along. That slowed down a bit towards the latter half of the year. We are now, Brad can talk about how we are starting to see that improve. It was still a good year. We have set this target out there. It started in 2016. We wanted to grow a minimum of 10% on the top line, half of that being 40%-50% of that being organic, the rest being both acquisition growth. We had a really good year as far as organic growth. We had some strong support from states with rate increases. We started to see some volume growth come back from the redeterminations. That was very helpful. We spent the year waiting and planning for our largest acquisition, Gentiva, to close, which happened on December 1st. It really sets us up. You talked about what do we expect in 2025. We now are rolling into this year where we're going to have all 12 months of Gentiva, an important acquisition for us that gave us two new states and five markets where it strengthened where we had already operated. We still believe very strongly in our 10% growth target. We believe that there's still a number of acquisitions out there that allow us to get there. It looks like this year with the rate increase we recently received in Illinois, which happens to be our largest personal care market, that we will be at the top end of that 3%-5% organic growth. Looking forward to 2025, we believe will be a very strong year. Part of that will be continuing our strong labor that Brad can talk about. Yeah, I mean, the labor environment, particularly when you're looking at the personal care, has really improved pretty dramatically over the past two years after we got through COVID and some of the enhanced benefits that were out there, unemployment benefits and such. Hiring numbers were good in Q4, a little down sequentially, but that's kind of normal, just variation with the holidays. It tends to be a little bit of seasonality there. Up over the prior year, we're in a good spot now, so having good solid hiring numbers. Really, we've done a lot of work on the hiring over the past three, four years, trying to make it easier for people to apply, make sure we get good candidate flow coming in, and speeding up our response and getting people their first billable case. That's been kind of one of the big initiatives we've had over the past several years. Where we've kind of pivoted and really started focusing on is how can we better leverage our existing workforce, which addresses, one, just getting more hours out of the workforce, but also addressing one of the core reasons why people may leave us is because they're not getting all of the hours that they need. Some of the things that we're working on from a technology standpoint are really geared to try to address that component of it. I think hiring numbers on the PCS side, we're in a good spot where I think there's opportunity for us, honestly, is really trying to work on maximizing our existing workforce that we have on the personal care front. When you look at the clinical side of the business, certainly that's improved significantly over the past year and a half. There's still pockets where you have some challenges to find. Maybe a CNA in a place like Oregon can be a little bit of an expensive market. Overall, we're in a good spot there. I think from a wage standpoint, we've pivoted from kind of a 4%-5% environment. Now we're kind of more in a 2%-3% in some markets, maybe 3%-4% in a couple of markets. I would say staffing is not the hindrance to growth on the clinical side. I think we're in a, it's challenging, but it's manageable. Got it. Maybe double-click on that a little bit on the personal care rate environment and what that means from a recruitment standpoint. It seems like we're in an environment right now where the rates you're getting are maybe a couple of bucks above minimum wage. That creates a really nice kind of backdrop for you versus where we were several years back when minimum wage was increasing and there were some periods of mismatch. Is that really what Brad kind of undergirds the stability that you mentioned in terms of your ability to recruit and retain? There's that sort of differential that currently exists. It certainly helps. We have been very fortunate over the past three to four years of getting some really good rate support from the states. That has translated to sometimes you'll catch us say that working with a minimum wage workforce, we really don't anymore. We're paying above, comfortably, generally above minimum wage in every market. That is because of the rate support that we've had. Certainly, that has helped the hiring numbers. I mean, I can show you a great example is we got a nice rate increase in Ohio. Certainly helped on the top line, but where it really helped, I mean, just straight up, just on the billable rate, but just the volume growth in a state like that really helped us on the recruiting front. We have been able to have some pretty impressive gains just straight up volume without even factoring in the rate component. The rate component allowed us to pay a higher wage and certainly made us a lot more competitive vis-à-vis other areas that people could have worked at, hospitality, that sort of thing. I was going to ask about the durability of that rate environment at the state level. I'm sure that reflects a lot of things, including just the value you guys are providing your state partners and your ability to communicate that value. How are you feeling about the durability in terms of just getting adequate rate updates from the states at this point? Yeah, I mean, I think it'll be a little softer environment going forward, I think, with some of the potential pressures. Now, that being said, I think over the, I think COVID, one of the silver linings, at least for us from a business standpoint, was an increased appreciation of providing care in the home and the value that that brings. I think there's a lot more appetite for states to make sure that we are in a position that we can hire the caregivers necessary in order to fulfill the demand that's out there for our services. You know. Let me add to what Brad said. We did just recently receive a rate update from Illinois, our largest state. They've been very positively driven towards giving us rate increases the last few years. We don't see that necessarily changing. We believe there'll still be support. We'll have to wait and see again because it's a year-by-year effect. We have other states like we're waiting on right now. There's a couple of our larger states that are in session, and some of them have proposals, still early, but have proposals that could potentially give us rate increases. That would be very nice from a standpoint of our company performance during 2025. While we do believe that, it won't be as strong of an environment maybe we saw during the COVID period when people really stepped up with rates, we do believe it's still going to be a good environment. That certainly some of our larger states that have budget surpluses have shown their willingness to work with us going forward with enhanced rates. Got it. That's great. I wanted to ask about the home care and hospice, the clinical side of the business, but sort of from an angle of give us a sense for how integrated those businesses are at this point into the personal care segment. Maybe one way to attack that would be sort of the proportion of referrals you get from your clinical operations from personal care. I don't know if that's something you guys track internally. Help us kind of think through the aspirations for driving more of that clinical overlap over the next couple of years. Yeah, I can start out. When you look at, let me start first with home health to hospice, which is where we would like to get from a personal care standpoint as far as transition to home health and hospice. We have the benefit on home health to have some software tools that help identify when a home health patient should probably consider hospice. And we can introduce the concept of hospice to the patient and the family. In our most mature market, which is New Mexico, where we have a large home health, large hospice program that overlap nicely in the state, we get about 25% of our admission volume is from our home health into our hospice. Are we ever going to get to that type of a number? I do not know, maybe. We have a pretty big personal care presence when you look at New Mexico and Illinois and Tennessee, where we have all three service lines. The challenge there has been until about a year and a half ago is really being able to identify. I mean, if you're taking care of 5,000 clients, how do you know which ones should we consider for services? Through our value-based arrangements that we've had with managed care on the personal care side, through that, we implemented a clinical system that took the changes of condition that our caregivers identify. It also pulls in external resources, hospitalizations, that sort of thing that feeds into a system that we can now risk score clients, personal care clients, which helps us narrow that focus down to here are the 50 clients that we need to think about today. Thirty of them may be individuals that home health might be an opportunity, whereas the others might be hospice. I would say right now, that's one of the biggest potentials we have out there. One of our key focus areas is really maximizing that continuum of care. Right now, the number of home health and hospice admissions coming from personal care into our skilled programs is not as meaningful as we would want it to be. I think there's a tremendous opportunity as we implement these systems, improve the training that we have with caregivers to report changes in condition, as we modify and improve the algorithms that are looking at that information and identifying here are the individuals that we need to focus on. I think that number can be certainly very meaningful because if you just look at the, just solely look at the demographics of the population we serve on the personal care, tremendous opportunity. These individuals are in and out of the hospital, which means they probably have opportunities to have or needs for home health. Certainly, at the age, that hospice is something that is certainly down the road, something that they would like to, they would access at some point. I think with some of the tools that we have in place and that as we continue to expand those, I think it'll become a very meaningful part of the referral volume or admission volume that we get into the skilled side. In terms of some of the tools and systems you are referencing and then the processes that come along with that, is that tied to the Homecare Homebase rollout that you've talked about? As you roll that out, then maybe there's some knock-on benefits, particularly on the clinical referral side. Is that a fair way to think about it? It is actually, this is outside of Homecare Homebase. However, Homecare Homebase, having everybody on one system will certainly enhance that opportunity. We could not wait for the full development of Homecare Homebase. We went out there and added some tools, but it is certainly items that we will be able to utilize in Homecare Homebase and expand upon with that software. It is certainly an opportunity. One of the things that we have talked about, getting everybody on the same system will have some significant benefits in being able to really maximize that continuum of care opportunity. Got it. I wanted to circle back on the Gentiva acquisition. I think you closed it December 1. Clearly, a noteworthy deal is probably one of your largest deals to date. It really gives you a pretty big presence in Texas, which I know has been a priority. I'd love to hear any observations you have about the business, how you've owned it for three or four months. If you could share sort of in particular what the strategy is in Texas and sort of the future opportunity in that geography. Yeah. I mean, I can start. Talk about the future. Yeah. When you talk about the opportunity. Yeah. I mean, when Yeah. I mean, when you look at the, I mean, it was our largest acquisition to date. It was one of the most aggressive kind of integration timetables that we've had. Normally, we don't move people to our payroll or benefits until 30- 60 days post-closing. We operate under a transition services agreement. Didn't have the ability to do that in this particular deal. We were able to successfully move everybody to our payroll and benefits day one, which hats off to our internal team working on that, but also to the leadership on the Gentiva side. It's really been a very, I hate to jinx it, but knock on wood, smooth transition and integration. Primarily, I think due to a couple of facts. One, this is an asset that changed hands five or six times previously. A lot of the leadership had been through those integrations. This was not something new. They also were able to kind of help us identify where there might be pain points and we could address those in advance. Secondly, coming into a predominantly a personal care organization, I think was welcoming to them. They actually were able to see some of the tools that we have available on our side of the business, on the personal care side, some of the dashboards and business analytics tools that now we've been able to provide to them. They are now live on our dashboards. They can see some of the same trends that we're able to see that they did not have available to them previously. I think we're still in the process of looking at some of the things that they bring to the table that's a little unique. We have private pay. We do a little private pay. We don't do a lot. They had a much larger private pay business than we do. They have a sales force that's connected to that. We are learning a lot from that and looking at opportunities to be able to expand that to our footprint in other states. Integration has gone very well. Very pleased with that and really excited about the opportunities as we look to expand some of the private pay, as we look to give them some of the business analytics tools that we've had available to us that I think will really benefit their operations. Yeah. I think just on the opportunity, I think Texas now with the large personal care presence there, we had a little bit of hospice in the central Texas area already, but puts us in a really good position. Even with us being the largest provider of personal care in the state, we're still a very small percentage of the overall market. I think we see a really good opportunity to continue to do some additional acquisitions in personal care to kind of enhance our market share in Texas, but also adding some clinical services, some hospice in some other areas, some skilled home health. Managed Medicaid operates in the state of Texas, which we always prefer. We'd like to do some things with them, maybe on the value-based side. Having kind of that full continuum, I think will be helpful. Obviously, Texas is a great state right now from just a budgetary standpoint, aging demographics, a lot of folks are moving into Texas. Really good market for the population that we serve. Is the market structured in a way where there's sort of chunky deals to be had in Texas, or will it be sort of ones and twosies as you just build it out kind of more sort of the mom-and-pop type of opportunities in terms of the personal care acquisitions you could do in Texas? I think we think it could be a combination. I think there are a few things that are more sizable that might even have a couple of the different service lines in there, but there is obviously a lot of fragmentation, so a lot of the small opportunities as well. It could be a combination. Got it. Let me try to tackle policy for a little bit. You all provided, I thought, some really thoughtful comments on the fourth quarter call on policy as it relates to what's being discussed around Medicaid. When we look at the actual specific policy proposals, it seems like you all would be pretty well insulated. I think right now the market still feels somewhat uncertain. Hopefully we get some clarity on what actually we're talking about, and then we can sort it out. I was hoping you could rehash a little bit in terms of either kind of what you're hearing in terms of what's being discussed and how you sort of think about your exposure to some of those potential proposals that are out there. Yeah. It has been a very interesting time, Matt, with Medicaid, the discussions around Medicaid and how that might affect not only Addus, but the industry. I think we did try to walk through that at the call. I think what we're hearing, I think the first two things we talked about on the call were caps from a standpoint of so much dollars per member covered in a state, and then also the potential for the floor of the FMAP to come down. According to our lobbyist in Washington, there's not a lot of appetite for that. I think the president might have, even some of his staff has come out. Maybe the speaker said, "We're not going to be touching those two particular issues. That's off the table." We will wait and see. If you go below that and think about the remaining items and how they could affect us, we don't see a lot of issue. Let me talk briefly about those. There's a couple of things they're going to take credit for on dollar savings if they get rid of the Medicaid Access Rule, getting rid of the 80/20. That gives them a certain dollar. I think they put about $120 billion price tag on that. I think if you get rid of the SNF nursing ratio requirement, that's about $20 billion. I think work requirements, where if you think about work requirements used to be the norm, went away. Today, if they reinstitute work requirements, if you think about the rules as they were before, people that are over 65 years old and retired are not going to be required to go back to work. The disabled are not going to be required to go back to work. That's who we take care of. That's our population base. From a standpoint of any of our patients, consumers being affected, we feel like there'll be no real effect there. What it could actually do, if you think in terms of if younger individuals that maybe they're single-parent families, that parent has to now go back to work for, say, 15, 18, 20 hours a week. They might have childcare issues, so they've got to work around a schedule when grandparents or others might be able to take care of those children. We're a perfect employer for those particular folks. We can work our schedules around. Our average caregiver is right at 20 hours or less. We believe that it could actually help us hire new folks if those are actually implemented. If you think in terms of that, what we've said for the last five years, the real top-line factor for our internal growth is how many caregivers can we hire? If we have a new group of caregivers out there that potentially can come on board, we think that'll be a positive. The final aspect that they talk about is waste, fraud, and abuse. Addus, along with some of the other big providers of personal care, have been talking to the we encourage implementation of rules and regulations that take care of the fraud, the waste, the abuse, because we have spent a lot of dollars. We put millions of dollars into building a very strong compliance and quality program here at Addus that we believe helps prove that we want to be a good citizen when it comes to things such as Medicaid dollars being spent. All of that put together, along with one important fact that we've been saying for the last 40, I guess it's now 46 years actually since being founded in 1979, is that we're the low-cost provider. If you think about a Medicare program, let's take the state of Illinois, which is our longest partner. We've been talking to them for years about the fact that we can help these very tenuous patients, these elderly patients that are high-cost healthcare cost patients. We can help keep them out of the emergency rooms. We can help reduce readmits to the hospital. We can keep them out of SNFs, which are a much more expensive way to take care of these patients as opposed to keeping them in their house with, say, 70 hours of care a month. For us, we believe we're in the sweet spot. If states receive any pressure from what's going on as far as our Medicaid program, we think we can be an answer to help them with that. With what is being spoken about today, we feel like there'll be very little direct impact to a company like Addus. Yeah. We hosted a policy panel earlier today, and this included even some conservative policy thinkers. They echoed a lot of what you said in terms of some of those across-the-board cuts being unlikely in terms of across-the-board changes to FMAP, that sort of thing. It seemed like the main focus was on the low-hanging fruit that they described was the work requirements and maybe some focus on provider taxes, and then much less likely are some of those across-the-board cuts that you mentioned. Some of the silver linings you brought up, I think, are interesting to consider too. One other I was thinking just had to do with, let's say there is some reduction to Medicaid provider taxes where you guys do not have exposure, but folks like skilled nursing facilities do. You mentioned the silver lining in terms of potential for labor supply to come. I was curious if you thought there was any validity in terms of if there's some pressure on skilled nursing facilities over a couple-year period, does that have a bearing on your business as well? I think any pressure that's put on the Medicaid program, whether it's skilled nursing facilities through this reduction in tax, if that's what occurs, hospitals, having the Medicaid population coming there, I think anything we can do to help avoid the need for those higher-cost services will be a benefit to the various state Medicaid programs. Again, knowing that everybody's going to have to deal with this, whether they're SNFs, whether they're hospitals, I think for us, what we take the approach is this. If we can continue to be the low-cost provider, if we can continue to be an avenue for the state to utilize to help take some of their Medicaid patients out of these higher-cost services, if we can, if our services can keep them at home, then that's a real positive for the states. That's kind of how we approach that whole scenario. Yeah. I think that's probably the most important kind of high-level point in terms of folks that are driving efficiency in the system, they'll be better off on the back end of it no matter what. Brian, I thought I might ask you the last question in terms of just 2025 seasonality, if you could kind of give us some pointers there. There's a lot of things moving in and out of the P&L, but if you had any kind of quick reminders for us in terms of how we should think about the P&L progression over the next couple of quarters, and particularly in terms of gross profit and SG&A, that'd be great. Absolutely. Yeah. I think just from the last quarter call, I think thinking about Q4 into Q1, Q1 is typically always our lowest kind of margin quarter just because of the reset of payroll taxes. We give our annual merits to our administrative staff, usually effective March 1. We are going to have a little bit of a mix in the business shift, with Gentiva being in for a full quarter being personal care. A little lower margin profile than our clinical services. That will happen in Q1. I think my commentary from our call was to expect gross margin compression from Q4 to Q1 of about 200 basis points. Again, that is normal. We see that every year. Nothing that is unexpected there. The way we typically see that kind of play out through the year, just normal seasonality, we usually see some increase going into Q2, usually 40-50 basis points, somewhere in that range as we hit some of those kind of unemployment payroll tax caps. As we get into Q3, it is usually pretty static, not a lot of movement. Q4 is usually our highest margin quarter of the year as we hit more of those unemployment tax caps, and then we also get our hospice rate increase. That is the way that we should think about kind of this year. A lot of moving pieces we understand toward the end of last year with New York kind of moving out, Gentiva coming in. This year, as it stands right now, should be pretty straightforward from that respect. As we grow top line, we've talked about personal care with some of the rate support from Illinois. We expect to be kind of toward the high end of that 3-5% organic revenue growth mark. We expect our hospice and home health to also move into that kind of mid-single digit range. We should continue to get leverage on G&A. As we see that growth, we should get some additional expansion on the bottom line. Got it. Guys, I think we've got to leave it there. Before we go, I did want to just congratulate Brad on his retirement. I know he'll be around for another year, but certainly an important event to acknowledge. Brad, congrats. Guys, thanks so much for being here. We appreciate you spending the day with us. Thank you, Matt. Thanks very much.