Good day, and welcome to Addus HomeCare's Third Quarter 2025 Earnings Conference Call. [Operator Instructions] Please note that this event is being recorded. I would now like to turn the conference over to Dru Anderson. Please go ahead.

Thank you. Good morning, and welcome to the Addus HomeCare Corporation Third Quarter 2025 Earnings Conference Call. Today's call is being recorded. To the extent any non-GAAP financial measure is discussed in today's call, you will also find a reconciliation of that measure to the most directly comparable financial measure calculated according to GAAP by going to the company's website and reviewing yesterday's news release. This conference call may also contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements, among others, regarding Addus' expected quarterly and annual financial performance for 2025 or beyond. For this purpose, any statements made during this call that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the foregoing, discussions of forecasts, estimates, targets, plans, beliefs, expectations and the like are intended to identify forward-looking statements. You are hereby cautioned that these statements may be affected by important factors, among others, set forth in Addus' filings with the Securities and Exchange Commission and in its third quarter 2025 news release. Consequently, actual operations and results may differ materially from the results discussed in the forward-looking statements. The company undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. I would now like to turn the call over to the company's Chairman and Chief Executive Officer, Mr. Dirk Allison. Please go ahead, sir.

Thank you, Dru. Good morning, and welcome to our 2025 third quarter earnings call. With me today are Brian Poff, our Chief Financial Officer; and Heather Dixon, our President and Chief Operating Officer. As we do on each of our quarterly earnings calls, I will begin with a few overall comments, and then Brian will discuss the third quarter results in more detail. Following our comments, the 3 of us would be happy to respond to any questions. As we announced yesterday afternoon, our total revenue for the third quarter of 2025 was $362.3 million, an increase of 25% as compared to $289.8 million for the third quarter of 2024. This revenue growth resulted in adjusted earnings per share of $1.56 as compared to adjusted earnings per share for the third quarter of 2024 of $1.30, an increase of 20%. Our adjusted EBITDA was $45.1 million compared to $34.3 million for the third quarter of 2024, an increase of 31.6%. During the third quarter of 2025, we experienced strong operating cash flow at over $50 million for the quarter. As of September 30, 2025, we had cash on hand of approximately $102 million. We ended the third quarter with bank debt of $154 million, leaving us with net leverage of under 1x adjusted EBITDA, allowing us the flexibility to continue to evaluate and pursue strategic acquisition opportunities. As most of you know, Heather Dixon became our President and Chief Operating Officer on September 15, with our former President and COO, Brad Bickham, moving to the position of adviser to the CEO until his official retirement in March of 2026. I want to welcome Heather to our team and thank Brad for all he has done for Addus over the past 9 years. This transition has been moving forward over the…

Thank you, Dirk, and good morning, everyone. The third quarter marked another strong financial and operating performance for Addus in 2025, as we continue to deliver consistent organic growth and benefit from our recent acquisitions. Our results were highlighted by 25% top line revenue growth and a 31.6% increase in adjusted EBITDA compared with the third quarter last year. Our personal care services segment was a key driver of our business with a solid 6.6% organic revenue growth rate over the same period last year, including a 2.4% increase in hours per business day. This growth trend has consistently tracked well above our normal expected range of 3% to 5% over the past several quarters, supported by strong hiring trends and favorable rate support for personal care services in some of our larger markets. This includes a statewide reimbursement increase in Illinois, our largest market, which was effective January 1, 2025, and a recent 9.9% rate increase in Texas that was effective on September 1, 2025. With Texas now being our second largest personal care market, this increase will have a positive impact on our business going forward, adding approximately $17.7 million in annualized revenue, with margins consistent with existing Texas personal care business of just over 20%. State of Illinois, which represents our largest PCS market, has also announced an additional 3.9% increase, which is set to be effective January 1, 2026, subject to customary federal approvals and will add approximately $17.5 million in annualized revenue for Addus, with margins consistent in the low 20% range. Our personal care results also include the Gentiva Personal Care operations, our largest acquisition to date, which we completed on December 2, 2024, and 2 months of operations for Helping Hands Home Care Services acquired on August 1, 2025. We continue to see…

[Operator Instructions] The first question comes from Matthew Gillmor with KeyBanc.

I wanted to ask about the same-store volume growth on the personal care side. Dirk had mentioned the improvement in the penetration of hours. And I think within that, you've talked about the benefit you're seeing from the caregiver app rollout in Illinois. Can you give us a sense for sort of how much more opportunity there is within Illinois? And then I believe you're rolling that out to New Mexico. And any update in terms of how that's gone and the penetration or the opportunity that would be with New Mexico?

Matt, this is Brian. I'll talk a little bit about just the penetration and Heather can talk a little bit about the schedule for the rollout in additional markets. But I think Illinois, a pretty mature market for us. We have seen some uptick there in our fill rate. I think in our view, going to New Mexico and Texas next. Their fill rate traditionally has been a little bit lower. So I think in our view, a little bit more of an opportunity, a little more headroom there to see some improvement. We saw some total improvement consolidated this quarter from last quarter. I'll let Heather talk a little bit about the rollout coming in New Mexico and Texas on the caregiver app.

Sure. Matt, it's Heather here. That rollout is going very well. We're seeing the caregivers really driving some utilization in a nice way in Illinois, where we have rolled it out. As Brian mentioned, next, we'll go to New Mexico, and then we'll follow in Texas, where we think we have a little more headroom to see some improvements. That app is really giving caregivers the ability to use the app to gain information that they will find useful to themselves personally, such as their pay expectations, et cetera, but also to just be more efficient. As an example, they can see what the capacity is for their clients. They can actually reschedule a visit directly in the app without visiting or even calling the office. So we're seeing that really drive some of the utilization in a positive way. If I go back to how you started your question, the growth that we're seeing on a same-store basis in revenue and PCS, that was partially due to the rate increases that we talked about in the script, but also just notably an uptick in the billable hours, which we also mentioned in the script. That's coming in at a very nice rate, and that's partially the focus on hiring and also the fill rate consistency. But we're seeing, of that 6.6% same-store revenue growth, over 1/3 of that is actually coming from the hours, the billable hours increases.

That's great. And then Brian, I was just going to follow up on the cash flow. It was particularly strong in the quarter, and it seems like the Illinois Department of Aging DSOs continue to decline. Is that just normal fluctuation? Or is there any effort on their part to pay in a more timely way?

No. I think traditionally, you're always going to see a little up and down just based on timing, nothing specific with them. I think what we like to see this quarter, Q1 and Q2 probably had a little bit of a headwind from working cap in both of those quarters. We saw that revert in Q3. I think where we sit today, year-to-date, we have, I think, net a little over $5 million benefit from working cap changes. So pretty consistent, but it's all just timing related, nothing specific.

The next question comes from Ben Hendrix with RBC Capital.

Welcome, Heather. Just wanted to follow up on that prior line of questioning in terms of the organic momentum you're seeing. How are you thinking about, especially in light of the strong Texas rate increase and what you're seeing in Illinois, the hiring trend into 2026? Is this strong volume growth that we saw kind of how we should think about a jumping off point for organic growth in 2026?

Yes, Ben, this is Brian. I can jump in. I think what we're seeing really on the hiring front, Dirk mentioned, 113 hires per business day, the highest mark we've seen all year. So I think we've gotten some good momentum on that side. The labor market continues to be pretty consistent. I think to your point exactly, when you get almost 10% rate increase in Texas, margins are going to be pretty consistent. So the caregivers are going to get some increases there. Well we've seen that in the past in other markets where caregivers are -- with the ability to pay more that traditionally has benefited hiring on the other side of that. So I would anticipate seeing something similar in Texas, which is a big market for us. I think it kind of plays all back into our overall thesis. If the rates are there where we can hire more caregivers, that's always going to help us on the organic volume side. So I think we feel like we're in a good spot here toward the end of '25, headed into '26, have some good momentum on that side. We've been talking about it for a bit. We really are targeting trying to keep above that kind of 2% year-over-year volume growth. We've kind of been at it or just below it early this year, seeing 2.4% this quarter was really nice, and we hope to keep that momentum going into '26.

Great. And just a follow-up also on your commentary about the complementary home health and hospice assets in specific markets. Obviously, a lot of uncertainty in home health, but solid rate update in hospice. How is that kind of changing your appetite right now? What would you expect in the near term in terms of how you're going to allocate capital to those markets where you're looking for that 3 legs of the stool?

Yes. We are always interested in home health in overlap markets where we can put them together with personal care and hospice. I think you see what we're seeing in New Mexico and Tennessee is validation of the strategy, which we believe where home health plays for this company. As we look to increase our home health segment, we will be careful. Obviously, the rate discussion that's out there now has kind of lowered the temperature for anybody to be able to do anything of size in home health. So we'll continue to monitor that. But again, remember, home health for us is truly an add-on to our personal care and hospice business. And so strategically, just like we've done in this past year, if we find companies that have home health in a market where we have these other 2 services, we're not opposed to going ahead and pull the trigger.

The next question comes from Brian Tanquilut with Jefferies.

Congrats, again, on the quarter. Maybe, Brian, as I think about 2026 -- I know we're obviously not giving guidance, but as I think about your ability to drive margins, I think we can build the building blocks to EBITDA on revenue. But how are you thinking about the margin opportunity as we think about next year?

Yes, I think the main thing to keep in mind as we continue to grow top line and we're continuing to see that kind of consistent growth, particularly in PCS and hospice, we should get some additional leverage on G&A. I think that's been our model all along. We're not going to grow those cost bases at the same rate. So thinking about just bottom line margin year-over-year, we would expect to see some benefit from that in '26, everything else being the same. I think, obviously, what we do in the mix and M&A can play into that as well. If we're a little more active on the clinical side, there's a little higher margin profile. But business as it is, I think it's more leverage on G&A costs with top line growth.

Got it. And then setting aside the fact that we're still waiting for this home health rule, we'll see when it is. But how are we thinking or how are you guys thinking about the home nursing business within your book? I know there are some moving pieces there. So just curious what efforts are being put into place to drive inflection there?

Yes. I'd say, we talked about a little bit, I think, in the last couple of calls, Brian, where we have really kind of 3 key markets in our home health business, New Mexico, Illinois, Tennessee, all through acquisition. We've done a lot of things over the last, I'd say, 9 months or so to really kind of get processes standardized, really trying to get the profitability level straight. I think still on the growth side, we have not kind of seen that take off, I think, particularly in Tennessee. We've got some new leadership in there to really try to kind of get that thing moving in the right direction. So outside of the rate, we'd like to see that business start to perform a little bit better. We're looking for, probably at a higher level, some leadership to come in and help with that as well. Heather can jump in on that here in a sec. But I think a focus of ours, but really to Dirk's point, a real benefit for us there, not necessarily the operations of that business per se, but the benefit that it provides indirectly into hospice. It's something you don't see on a segment level in the results of home health, but they're definitely benefiting in the hospice area. But I'll let Heather talk a little bit about that as well.

Yes, I'll pick up on that. We're working on several initiatives within that business, and we're seeing admission volumes stabilize on a same-store basis. But what we're seeing is a decline, sorry, in recertifications, which is attributable to what Brian is referencing. So I'll talk about that for a minute. That's the bridging program that we've put in place to make sure that patients are receiving care in the right setting and the right level of care. And that's been in place for a while in New Mexico, and then we rolled it out, as Brian mentioned, within the last 12 months in Tennessee, and we're seeing it really start to take off there. And what we're seeing is an uptick in our admissions from a hospice perspective in those markets from these referrals. And in fact, as we mentioned earlier, in New Mexico and Tennessee, over 25% of our hospice admissions come from the home health segment and from this program. So we see this as a real benefit in having the 3 levels of service in the markets that we serve and particularly between home health and hospice, where home health is just really a complementary line of service to the other businesses.

The next question comes from Joanna Gajuk with Bank of America.

So maybe first, couple of, I guess, numbers and clarifications. On your comments about fourth quarter gross margins, right, sounds like it implies maybe high 32% or so for gross margin. And then if we assume G&A, call it, below 21%, I guess it implies adjusted EBITDA above 13% or so in Q4. Is that the right way to think about numbers?

Yes, Joanna, I think that's fair. I think if you look at the seasonality of our business and our company, Q4 is always the high watermark for margins for us, and I would expect that to be the case. We've been solidly in the 12s all year. But Q4, based on what we see right now, expectation of being 13% over for that quarter, I think, is definitely reasonable.

And I guess you answered the other question around the margins for next year. So if you grow high single digits or low double digits revenue, right, it's going to be G&A leverage. So growing from, call it, 12.5% or so for this year, adjusted EBITDA, that should be kind of our thinking about next year, right, growing from that level?

Yes. I think that's fair. I think back to my earlier comment, I think top line growth is always going to get us some additional leverage on G&A. So everything else being equal. Obviously, everything can change at any time as we all know, but everything else being equal, that should be the case.

Okay. And my question on the topic of rate updates from your key states, [ that you did great in ] Texas and Illinois. And on your last call, you alluded to the idea that there's an expectation that New Mexico, Pennsylvania might have some rate increase. It doesn't seem like Pennsylvania is in a position to increase rates, right? So is there a risk to a rate cut in that state in particular? And any other states that you're on the lookout for? And maybe give us a little bit update on New Mexico.

Yes. I think New Mexico, when they get into their budget cycle for next fiscal year, which is still early, we're not in that range yet, I think we're hopeful that with their consideration of a rate increase this year, that will be something that they'll consider next year. And obviously, we'll be working with the industry on advocacy for that in the next cycle. I think on Pennsylvania specifically, yes, I think they had considered a rate increase this past year. I think with everything going on there, I think our most recent intelligence from what's going on in their budget or inability to get a budget would probably put us in a position of thinking we'll probably be flat again. I don't think we're anticipating a rate cut, but probably not as optimistic as we were about a rate increase in Pennsylvania in this next budget.

And any other states that we should be looking out for in terms of any major increases or, I guess, potential for cuts?

No, nothing that we're aware of at this point. I think usually, a lot of those states when they get into session, it's going to be probably more early '26, early the spring time, but nothing that we are aware of that would be worth mentioning at this point, no.

The next question comes from A.J. Rice with UBS.

Welcome aboard, Heather. Maybe just to think broadly about the acquisition and deal pipeline. I know that's an important part, obviously, of your ongoing inorganic growth strategy. Can you just update us on what you're seeing competitively across the main buckets, how pricing is evolving? And what does the pipeline look like, whether it's pretty deep or a lot of things are just on hold right now?

Yes, A.J., I think I'd characterize it that we haven't seen probably a lot of shift from where we have been probably over the last, I'd say, 1.5 years or so. Most of the things that we're looking at or are in our pipeline today are probably on the smaller side, similar to Del Cielo we just closed, Helping Hands that we closed last quarter, in markets that we're in, providing some density, low multiples. PCS on the small end are still going to be -- could be as low as 4x and 5x. Even larger size could be maybe 7x, maybe 8x. That really hasn't moved much. I think on the clinical side, there's been a couple of large -- very large hospice organizations that traded this year for very high multiples. It seemed like there maybe was a little bit of moderation coming in, but still probably mid-teen type expectations, so still a little pricey on that end. We would always be interested in hospice, but probably at a little lower price point. And then home health, as Dirk kind of mentioned earlier, there is some benefit to us and how that feeds into or works with personal care and hospice. So if there's opportunities on the home health side, it's going to be probably on the smaller side for us in markets that we're in kind of overlapping. Those are things we'd be interested in, but those tend to still be a little on the inexpensive side. So if they're smaller, it could be upper single digits, maybe it presses closer to 10-plus times if it's more sizable. But obviously, we'll always work into our performance on any home health deal, what might be going on with rates. We're very cognizant of that as well. I think what we're hearing from folks externally thinking about '26, there could be some things that might be on the larger side that might be available. Some of those might be interesting to us. So early conversations, nothing really to report, but we're hopeful maybe there's a little more opportunity for us to do some larger chunkier things next year.

Okay. And I know you've been asked a couple of times about home health. But if, say, we get the rate noticed and it gives clarity as to sort of the trajectory, is that enough, do you think to maybe step up the pace in home health a bit? Or do we need some time for everything to settle out, assuming we get some kind of a rate action, either the 6.4% is proposed or maybe they happen or something like that. Does it take some time for the market to sort itself out? Or do you think people will react pretty quickly and you might be able to step up the activity in home health there?

Well, I think getting this year's rate finalized will certainly take one of the issues that's on the table as far as doing much in the home health industry. The problem you're going to have, A.J., is that unless they come out with a fix for the potential clawback, which is, what, 400 basis points of this year's potential rate reduction, if they do away with that, are they going to send a signal that, that is passed and won't come back up again? As long as that overhang is still out there on any potential clawback, I think it's going to continue to keep the acquisition in the home health market a little moderated in the future.

The next question comes from Jared Haase with William Blair.

I wanted to ask another one on your comments about the value of having overlapping operations in New Mexico and Tennessee and the impact that has on referrals between home health and hospice. So I'm curious, when you look at the data, do you actually see a meaningful difference? When you have the overlap there, do you actually see a meaningful difference in either patient satisfaction, quality of care, anything to that effect when you kind of have that density of service offerings in a particular market?

Jared, this is Heather. We do -- we see a couple of benefits that are coming from that referral ability from home health to hospice. The first, it's better for the patient and for the family to be in the right setting of care and to be receiving the right level of care. So we see that benefit that comes through. We also see continuity of care from those 2 different settings of care from home health to hospice. So what we're seeing from the patients and from their families, of course, once they're in hospice has been positively influencing some of the decisions that we're making as we see those hospice admissions that are really supporting -- or being supported by home health.

Got it. That's helpful. And then I just wanted to follow up as well on the comments around clinical labor. And it sounds like that's been stable for at least a few quarters now. I think you mentioned outside of a few challenging urban markets, though. Just wanted to understand that a little bit better. So what specifically is sort of challenging in some of those markets? Is that largely just a function of kind of the broader reimbursement environment makes it harder to compete on wages in certain areas or something else we should be thinking about?

No, I think it's really largely just related to some of the larger urban markets. And more specifically on the skilled side, we're seeing better opportunities for hiring than what we have seen in the past. But as pockets are arising out there or continue to be managed through, it's very limited to those skilled hires, I would say, and then the urban market.

Okay. Got it. I guess maybe just a point of clarification then. If we did get some sort of meaningful relief on the reimbursement rate in the home health space, do you feel like the labor market is such that you would be able to kind of attract the folks that you need to return to more consistent organic growth there?

Yes.

The next question comes from Raj Kumar with Stephens.

Maybe just kind of focusing on hospice. I know the company has kind of talked about making key investments in the team over the past few quarters. And maybe just kind of want to break down what they've been able to identify, clearly strong results organically this year. And have they been able to reconcile all what they've identified in 2025? Or should we expect a kind of multiyear opportunity in terms of being able to display kind of above targeted same-store revenue growth for that segment?

Well, maybe I'll start with some of the initiatives that we have that are driving the results, and then Brian can talk about sort of how we think that will develop from a future perspective. But you're right, we're seeing very nice volume growth in that hospice segment. And I think there are a few things that I would point to. The first is just a focus on better execution. That includes a focus on our onboarding and training efforts across the board, but specifically related to the utilization of community liaisons. We've mentioned that we've made some leadership changes there, and we've invested in a sales function that is focused on structured sales efforts and developing local market strategies for business development, including a better utilization of those community liaisons. We've mentioned we're seeing success from that bridge program that we put in place to drive the right referrals from home health into hospice, and we've talked about that, that that's really been something positive that we're seeing. And so we do see a lot of positive momentum in that hospice business that we've seen through the quarter. We've seen that building and that we would expect to continue.

Yes. And Raj, I think, obviously, 19% organic growth is probably not something we would expect to have into perpetuity. But I think we've said for a long time, everything else being equal, we would expect our hospice business to have an opportunity to grow in the kind of mid to at least upper single-digit range. So I think all the changes that we've made, I think the comps that we're seeing over the last year is probably driving some of the percentage increase. But as we get settled into a nice trend, I think that upper single-digit range is probably still fair. So our business, we're going to get the benefit of a little over 3% on rate. So if you think about what that leaves for ADC growth, I think we feel pretty comfortable that we could continue in that range.

Got it. And then maybe just on home health, kind of fee-for-service mix trended kind of lower sequentially and year-over-year. I know there's been progression on the margin front with that business as you kind of case to optimize the whole book. But trying to get a better picture of kind of how margins did trend in this quarter given the mix shift dynamics. And there was kind of higher MA mix. So maybe trying to gauge also if there's any incremental case rate or episodic reimbursement wins on the MA side in the quarter.

Yes. I think we continue to make a little headway on just getting better rates and working with MA plans and moving to more episodic. That's really our focus, not necessarily Medicare fee-for-service versus MA, but really episodic versus non-episodic. And I think we've made some progress there. I think in this quarter's numbers, you're seeing a little bit of impact. It's small, but Helping Hands was largely MA's a little bit of home health business up there. And I think in Tennessee, we've got contract changes that we've gotten done down there that have helped kind of shift a little bit of that business in that Tennessee market. But nothing, I think, on a high level that I would flag out as being material overall.

The next question comes from Constantine Davides with Citizens.

Just a quick one on Del Cielo. Their website says they also offer other levels of service. So I just wanted to confirm that the only thing you're getting is just the pure personal care business.

That is correct. We only purchased the personal care assets of that business.

Great. And then just a follow-up on this 25% figure, New Mexico and Tennessee in terms of impacting growth in hospice. You've obviously got a PC footprint that's multiples bigger than what you have in home health. And I was just wondering if you could articulate some of the benefits of being in personal care as it pertains to maybe the growth algorithm in both home health and hospice.

Yes. Thanks. That's a great question. It's part of our overall strategy that we've been following for a number of years now. We believe that everything starts with personal care. That is something that we have stated before and we will continue to state. The problem with getting a bridge program today as strong as we see from home health to hospice from personal care up to other levels of care is the EMR in which we operate today. So if you look at today, we've got Homecare Homebase in the home health and the hospice. So everything can be done from an electronic standpoint where we can use systems to kind of look at our patient base and recommend levels of care and changes that may need to happen in the future. The problem we have today with personal care is it's on a different system. So everything from a bridge process is much more manual. And so that is why 3 or so years ago, we started working with Homecare Homebase to develop a strong personal care system that we could put in place and then use going forward to have one EMR, so that we could start a bridge program all the way through our levels of care. We are early in that transition. We are still working with Homecare Homebase. There are still some things we need to finalize. I think today, we have 5 small states that are using that today, and we're learning from that. But the whole plan going forward is to get this on one system, so that then you will start to see the same sort -- in our minds, the same sort of bridge results that we currently get between home health and hospice, you can then start with personal care. So that, again, kind of encapsulates our entire strategy that we've been applying for the last 4 or 5 years.

The next question comes from Christian Borgmeyer with TD Cowen. [Operator Instructions].

I had a question about the hospice side. Revenue per patient day was really strong in the quarter, and you also cited an improvement in the Medicare cap cushion. I was curious if this was a tailwind to revenue per PD in the quarter? If there may be a similar dynamic in 4Q? And then just curious what sort of clinical dynamic drives this Medicare cap liability.

Yes. I think -- this is Brian. On the Medicare cap side, Dirk mentioned we had no liability this quarter. We actually took a little bit of a charge in Q2. So I think sequentially, you saw a benefit of that flow through the revenue per patient day. I think the other thing that impacted this quarter, I think just on a year-over-year basis, we did see some positive effect from the good old implicit price concession or revenue adjustment or whatever you want to call it. But we had some positive experience in collecting some older aged AR, and I think that benefited a little bit in this quarter, but nothing that was, I think, overly material. I think just going forward, just talking about cap, I think we feel like we're in a pretty good position. I think we've had a lot of focus in a couple of locations where we had that issue creeping in. We have done a lot there to make progress on our referral mix, and balancing that out is a highlight for us. So I think if you look at us historically, we've always had probably 1 or 2 locations every year that might slip a little bit into cap. It's nothing new for us. It's something that we manage kind of day-to-day, but I think we feel pretty good where we are coming out of Q3 into Q4 that we're in a good spot.

The next question comes from Andrew Mok with Barclays.

This is Jeffrey Song on for Andrew. Medicaid payers have been under a lot of pressure recently. Can you help us understand the nature of the dialogue between payers and providers in the home health space in recent months?

Yes. If I understand your question and what you're trying to get to, I do think the OBRA out there has put some pressure on states with their Medicaid programs. They're having to look at how do we take the dollars we're continuing to receive from the Feds and apply that effectively to our Medicaid program. And I think that's where that puts Addus squarely in an important seat in that discussion, because if you think of our service, when people are qualified for first care services, they also would be qualified for nursing home services if we cannot keep them in their home with the amount of hours that the states are giving us. So we have demonstrated to a number of states and a number of our managed care partners through value-based care contracts that by following certain protocols, keeping them in the house, we're able to reduce various aspects of other costs related to those patients that would be covered by Medicaid, whether that's emergency room visits, whether that's readmits to the hospital, or quite frankly, SNF, where people would end up in 24-hour SNF care, which is much more expensive to the state. So it's our job as an industry, it's our job as Addus to continue to work with the states to show them the value proposition of if they are looking where to put their dollars for the Medicaid program to be the most effective to make sure that they put it into the personal care business, which is going to save them money overall.

This concludes our question-and-answer session. I would like to turn the conference over to Dirk Allison for any closing remarks.

Thank you, operator. I want to thank each of you for taking the time to join us on our earnings call today, and I hope you all have a great week.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.