ACHC
#That's a tough question.
What we see in the team we have there today is some great leaders, lots of energy, tremendous expertise over there, a can-do attitude.
So, the Priory was the bigger of the transactions, as everyone knows.
And their depth there was stronger, and so, fortunately for us, Ron and <UNK> were able to pick the best of what they thought were the best, and so just a great group.
That's not taking any shots at the group that left.
The group that left with the acquisitions, we wish them well and hope they do well, and Tom Rao is going off to other things, so we have a good team there.
We have the team that we think we need there, and so far it is going well, and they are doing a good job working through the distractions that they have, and they are very good operators.
Sure, <UNK>.
The offices that we have in the UK, we have three different centralized offices that support all of the facilities.
We have a finance office in the North, in Darlington.
We also have HR and IT offices, and I do think that that provides us with the ability to perform those functions at a lower cost.
While we also get excited about in those offices is the retention that we have, and just the teams that are there have been with the Company for a long time, do great work, and we do not tend to see the same types of turnovers that we might see in other parts of the country.
So, definitely a lower cost, and we also have a great team that has been with the Company for a long time.
Well, yes, on a run rate basis.
Obviously, when you take the Management out for the month of December, you only realized one month of that annual run rate, but we are on a run rate.
And I think to answer your question and <UNK>'s question, it is important to recognize here, if we are still talking about $20 million in synergies out of the UK today, that's actually better than what we originally said a year ago, because $20 million takes more pounds than it did a year ago, because the exchange declined.
So, we are basically halfway with the divestiture, and then we will get the remainder benefit of the synergies throughout the 2017 such that when we get to the year, end of the year, $20 million of annualized savings on a run rate basis.
Sure.
Great question, <UNK>, and obviously, we are, foremost is just protecting a lot of the things that we have been, so, the industry has had such success and getting access, getting coverage, parity, essential health benefits.
We did not as an industry receive tremendous impact from ACA, but we want to be very careful that we have a seat at the table, and when they adjust, they repeal and replace, or whatever happens, that we do not lose things that we never really benefited from.
And so our industry association has great leadership.
We are much more recognized.
We do get the face time and the feedback.
We have an annual meeting coming up in the spring, and there will be a lot of grassroots efforts, so again, our industry is positioned well knowing that the critical care, the importance of what we do, but we are spending time just making sure that as lots of discussions around, changes happen that we do not have anything negative occur to our space.
Hey, <UNK>, our estimate for next year is just under $31 million for stock comp.
That is correct.
We do not include transaction expense in our guidance.
We will see some just related to the ongoing divestiture cost, as we realize the remaining synergies and have some employee termination cost.
That should not be significant, but we will plan to see that, and that is excluded from our guidance.
I think you could just allocate it by quarter, 25%.
Is it going to be a little off of that periodically, could be, taxes are very precise.
But it is going to be a lot closer on average to the 25% throughout each of the quarters.
Thanks, <UNK>.
<UNK>, length of stay in our industry has been on the acute side, in the 9 to 10-day range for 25 years now.
This is an industry statistic.
We just don't see, that is not an area that there has been longer lengths of stay.
The UK, by contrast, is months/years, not days, so we do not see a change on overall length of stay to the negative.
We think it's, most providers and professionals in our space are concerned that it is too short now, which really leads to a higher likelihood that the patient comes back into a facility versus the small savings of one or two fewer days that might be garnered.
Sure.
Yes.
What you see in our sort of same facility profile of the revenue per day is really heavily impacted by just the mix of patients, it is not the same every quarter over the prior quarter.
I think if you look at our payer mix and think about roughly in the US, 16% revenues from Medicare, we get a consistent annual cost-of-living increase on the PPS rate there of something in the 1.5% to 2.5% range.
And then Medicaid, obviously our largest total payer group at 40%, but coming from over 44 states, each state is different, but in positive economic times, when the state revenues are doing well, we are going to see small cost-of-living adjustments there, call it 1%, and then our commercial book of business, in the 30%, 35% range.
We focus on local negotiations, and with those payers, and generally focus in on trying to get 5%-plus revenue per diem increase each year from those payers.
Sure.
We roughly have 55% of our debt floats, and 45% is fixed.
I think it is important to note, we have saved over, well over $10 million of annual interest expense last year through a couple of different repricings of our term debt, so we in effect built in some cushion against these increasing rates, and the latest pricing change did not occur until December, so some of that benefit will flow through in 2017.
We have talked, and we have a $650 million of cross currency hedge on our ---+ that helps protect some of the cash flows on the UK.
We do not have currently any fixed or floating to fixed rate swaps in place right now.
But as the market indicates, we continuously look at what is the best fixed to floating structure given the rate environment.
But right now, we are very comfortable with our interest expense and debt profile.
Thanks, <UNK>.
<UNK>, obviously, that is a, and once again, it's another tailwind positive headline, $1 billion allocated to the states for medically-assisted treatment.
In a lot of things, that sort of has figure its way through the states and local areas.
We are very committed to the medically-assisted treatment business, and have a great team there, and they are going that business, so obviously it's a positive.
It's hard to quantify, though, how much and the when, but it is absolutely better than having something cut.
So, that's a tremendous need.
You see more and more just awful stories about the impact of the opioid epidemics, and the impact of that abuse.
So, we are optimistic, but we just don't have the specifics on how that is going to play out for us.
Acquisitions will still be larger than the number of de novo beds that we would be adding to the Company.
We are going through that negotiation process right now.
Around the 2% range, but we are negotiating that as we speak.
No, <UNK>, we do not.
That 25% represents the consolidated Company, the corporate tax rate in the UK has gone down, it is below 20%.
The tax rate in the US, you know is the 35%.
But the consolidated rate is just what represents the consolidated Company and all the other items that impact our tax rate.
<UNK>, repeat that question.
So, that would be 5% to the consolidated rate.
It's 35% UK, 65% US.
Nothing in the next 12 months, nothing in the next 12 months.
However, if somebody wanted ---+ no, nothing in the next 12 months.
(Multiple speakers) Okay.
Good.
No, no, no, no.
You just confused us, <UNK>, because you have asked six follow-up questions.
You must have thought the rule only applied to the original basket.
(Laughter) We just created another <UNK>ism.
(Laughter).
Thank you very much.
Thank you, everyone, for listening in and your questions.
The year is beginning, we have got a lot of hard work to do, but we have got the team that can make that happen.
And I want to thank all the employees of the Company and the people we work with, and we are interested with those patients, and we want to do a great job for them.
So, once again, thank you for your questions, and we will talk to you on the next call.
