David Castille - Director of Treasury/Finance Ronald A. LaBorde - Interim Chief Executive Officer, President and Director Dale E. Redman - Interim Chief Financial Officer.

Brian Tanquilut - Jefferies LLC, Research Division Darren Perkin Lehrich - Deutsche Bank AG, Research Division Kevin K. Ellich - Piper Jaffray Companies, Research Division Ralph Giacobbe - Crédit Suisse AG, Research Division Frank G. Morgan - RBC Capital Markets, LLC, Research Division Whit Mayo - Robert W. Baird & Co. Incorporated, Research Division.

Good morning. My name is Stephanie, and I will be your conference operator today. At this time, I would like to welcome everyone to the Q3 Earnings Conference Call. [Operator Instructions] Thank you. Mr. David Castille, Managing Director of Finance, you may begin your conference..

Thank you, Stephanie. Good morning, and welcome to the Amedisys investor conference call to discuss the results of the third quarter ended September 30, 2014. A copy of our press release is accessible on the Investor Relations page on our website.

Speaking on today's call from Amedisys will be Ronnie LaBorde, President and Interim CEO; and Dale Redman, Interim CFO.

Before we get started with our call, I would like to remind everyone that any statements made on this conference call today or in our press release that express a belief, estimation, projection, expectation, anticipation, intent or similar expressions, as well as those that are not limited to historical facts, are considered forward-looking statements and are protected under the Safe Harbor of the Private Securities Litigation Reform Act.

These forward-looking statements are based on information available to Amedisys today, and the company assumes no obligation to update these statements as circumstances change.

These forward-looking statements may involve a number of risks and uncertainties which may cause the company's results or actual outcomes to differ materially from such statements. These risks and uncertainties include factors detailed in our SEC filings, including our Forms 10-K, 10-Q and 8-K.

The company disclaims any obligation to update information provided during this call other than as required under applicable securities laws. Our company website address is amedisys.com.

We use our website as a channel of distribution for important information, including press releases, analyst presentations and financial information regarding the company.

We may use our website to expedite public access to time-critical information regarding the company in advance or in lieu of distributing a press release or a filing with the SEC disclosing the same information.

In addition, as required by SEC Regulation G, a reconciliation of any non-GAAP measures mentioned during our call today to the most comparable GAAP measures will be available on our website on the Investor Relations page under the tab Financial Reports, Non-GAAP. Thank you, and now I'll turn the call over to Ronnie LaBorde..

5% increase in Medicare revenue; 3% growth in Medicare admission; 5% growth in Medicare recertifications; and finally, 31% growth in non-Medicare revenue. Non-Medicare revenue for the quarter was up slightly over the second quarter and reflect the second consecutive quarter of significant same-store growth.

Last year's third quarter revenue was the lowest of the last 5 quarters and thus led to a very favorable comparison. In hospice, we experienced same-store Medicare revenue growth of 3% that was largely driven by a favorable cap adjustment and the rate increase in 2014. Same-store average daily expenses was down 2%.

Third, we will continue to focus on incremental efficiencies in our operations, both in cost of revenue and G&A. Gross margins in home health and hospice increased over the prior year. G&A expenses decreased from the prior year. Dale will provide more details in his comments in just a moment.

For the last couple of years, our hospice performance, while relatively stable with respect to net financial contribution, has experienced a slow decline in average daily census. With our focus to improve performance in hospice, Jim Robinson has assumed the role of Chief Operating Officer of Hospice Operations effective October 1.

As you may recall, Jim previously led hospice through a period of significant growth, and I'm confident that his leadership will provide the necessary energy and focus needed to improve our performance in this division. Finally, with respect to capital allocation.

We spent less than $1 million on capital expenditures in the quarter and $10 million year-to-date. We expect to end the year below our initial indication of $18 million. During the quarter, we paid down $28 million in debt. With respect to our AMS3 implementation, we will install our next beta site on November 1.

CMS should be releasing its final 2015 home health rule in the coming days. Our preliminary estimate for the reimbursement cut is approximately negative 80 basis points. The hospice rule was published in August. The payment update amounts to a 1.4% increase that took effect on October 1.

With respect to the search process for our permanent CEO, no color update can be provided at this time. So in closing, let me say that I am extremely proud of the effort of the entire Amedisys team. Their confidence, focus and perseverance has resulted in improving results and fostered an eagerness for further progress.

With that, I'll turn over the call to Dale Redman, our Interim Chief Financial Officer..

Thank you, Ronnie, and good morning. For the quarter, we generated revenue of $300 million and earnings of $0.26 per share on a GAAP basis. There were 2 noncash write-offs in the quarter totaling $1 million or $0.02 per share. Incorporating these items, adjusted EPS was $0.28 per share.

Adjusted EBITDA was $24 million with a margin of 7.9%, an improvement of 5% from last year and 6% from our first quarter margin. Before I go into detail about our segments and year-over-year comparisons, I would like to comment on our sequential performance.

For the most part, our expectations materialized from the second quarter to the third quarter, particularly in terms of lower home health volume, holiday cost and increased interest cost. In addition, we incurred some run-off costs from our closed care centers of approximately $1 million.

These were offset by some favorable developments, including a half hospice cap adjustment and G&A items that did not recur at the same levels. This led to a better sequential comparison than we had anticipated. In our segment results, we'll be focusing on year-over-year comparisons. Gross margin was 42%, which was up 1.5%.

Cost per visit was down $2 to $85, a significant improvement from $87 and $90 in the third and fourth quarter of last year. In hospice, our gross margin was 48%, a year-over-year increase of 1.5%. Volume declines were offset by rate increases in 2014 and a favorable adjustment to our hospice cap reserve.

Consolidated G&A expenses decreased $13 million year-over-year and $20 million year-to-date. These savings were achieved through the closure of care centers beginning in 2013 and G&A reductions that we identified on the first quarter call. As Ronnie mentioned, we have previously disclosed an expectation of $18 million of capital expenditures in 2014.

However, we now believe we will incur $5 million in the fourth quarter, largely driven by a planned refresh of tablets used by our clinicians. Thus, our total expenditures for the year will be approximately $15 million. We ended the quarter with $6 million in cash on the balance sheet.

Cash flow from operations for the quarter was $25 million, and DSO was down to 30.5 days from 32 days. Outstandings on our revolving credit facility at the end of the quarter were $10 million. Excluding proceeds from our second lien financing, during the quarter, we paid down $28 million in debt.

Late last week, we made the second and final payment of $36 million, including interest associated with our DOJ settlement. We anticipate further reducing debt balances during the fourth quarter and into early next year. Our total leverage ratio sits at 2.1x, down from a recent high of 3.2x at the end of the first quarter.

Our operating performance and capital structure improvements have strengthened our balance sheet and provide us with additional flexibility to operate our business. Finally, we're not providing guidance for the remainder of 2014. This concludes our prepared remarks. Stephanie, please open the call for questions..

[Operator Instructions] Your first question comes from the line of Brian Tanquilut with Jefferies..

Ronnie, first question for you. It was nice to see the recerts turn positive, obviously, to a pretty healthy number.

So just wondering what your view is today in terms of just where your volume trends are, where the recerts are and whether you think that we've seen the bottom for that specific metric?.

Yes, Brian. Thanks for the question. With respect to the recerts, let me say, we have been relatively stable here for the last few quarters. Actually, the first, second, third. I think we're in a stable environment.

I think that operatingly -- on an operating basis, at a sustainable level, we're obviously focused on it to take care of our patients and provide the right care. And I think we have returned to a level that we feel pretty comfortable with..

So Ronnie, look, I guess, look -- maybe I didn't ask the question properly.

But should we think that the level that we're seeing now for volumes, where you're in the sort of 4% or 5% range, is that a healthy level that you think is sustainable going forward?.

Brian, I would say that, generally, volume levels are, we think, in a sustainable zone, that the percentage increase, of course, will be a function of the comparison, but we're certainly in a zone where we're pretty comfortable we can sustain it..

Got it. And then on the cost side, I know you guys have outlined the things you've done, then the opportunities. But as we look at the dollar amounts, it seems like we're starting to see a flattening out on the G&A or the other, a lot of the expense lines.

So are we at that point now where, basically, you've done all the pulling out of expenses that you had to do and we should expect, on a dollar basis, to see a flattening out and maybe a little bit of inflation going forward? Or is there still fat, so to speak, that you can pull out of the system?.

I think -- this is Dale. I think the answer to that question is we've made a significant amount of progress in making sure -- or attempting to make sure that we are at right size given this -- the portfolio of agencies that we have. Having said that, I think in Ronnie's comments, he mentioned that there's further work to be done.

And so we're going to continue to look at ways we can be more efficient, which practically everybody in the health care business is working on those issues. So a general answer to your question, I think there's other opportunities for us. I think we've done a lot of the things that are necessary to get us to the position that we are now.

But we will continue to look for opportunities to be more efficient as we go forward..

Dale, to that point, if the volumes stay -- if the growth trajectory stays at this healthy sustainable level, would you have to start putting dollars back into the operations in order to sustain that growth? Or do you have the infrastructure in place right now to support, say, 4% or 5% growth over a 2- to 3-year horizon?.

I think our infrastructure is generally where it needs to be to deal with that kind of growth rate. As Ronnie mentioned, sometimes you have aberrations in those percentages simply because of the comparison. We have 2 objectives here. One is to be as efficient as we possibly can, I'm talking about from a financial standpoint, quality always being job 1.

But beyond that, our 2 objectives are to be as efficient as we possibly can; and secondly, fundamentally, what we need to do is to increase and focus on the growth of this business. Now having said that, will there be some inflation as we go forward? Absolutely. We will probably have some wage inflation as we go forward.

But we believe that, by focusing on operational efficiencies and growing the business, we can deal with those issues..

Okay. And then last question for me.

As we look at the fourth quarter, how should we think about seasonality in your business as we model? I know you don't want to give guidance, but just qualitatively, how should we think about seasonality for the fourth quarter?.

One, we are looking at some kind of rate cut, which we have estimated, at this point, for us, to be about 80 basis points going into 2015. However, some of that will impact us in the fourth quarter because of the episodes in progress.

Second thing I would point out is that the hospice cap adjustment that we discussed in our prepared remarks was about $0.03 -- increased the third quarter by about $0.03. We do not believe that will recur in the fourth quarter. Having said those 2 things, we are optimistic about the business going forward..

Your next question comes from the line of Darren Lehrich with Deutsche Bank..

I wanted to ask a few model-related questions here. I guess, just picking up where you left off, Dale, you broke up a little bit when you were describing the cap. So $0.03.

What was the pretax number that you made the adjustment for, for the cap?.

Yes, Darren, it was about at $1.5 million, so roughly $0.03..

Got it. Okay, and I guess....

And let me just stand on that just for a second. What really happened there is that we had 2 care centers that had -- that we calculated had significant cap exposure.

Both of those care centers have improved their operations significantly in -- coming into the third quarter, and so when we recalculated our liability, that's what created this $0.30 benefit in the third quarter..

Got it. And I guess just maybe expanding a little bit more on cap.

So how many provider numbers do you have in total in your hospice business at this point? And how many of those provider numbers are currently accruing some cap?.

Well, we have about 80 care centers in the hospice operation. I'm not sure I've got a number for you right off the bat of how many provider numbers that is. And we don't disclose how many of those have cap liabilities, other than I will tell you that there were 2 that had significant liabilities.

I think it's a very minor portion of those 80 care centers that have any cap liability at all..

Okay. So on a go-forward basis, your assumption for cap would be just a modest accrual every quarter.

Is that the right way to think about it?.

Well, I think the way you think about it is that, yes, that's probably reasonable. The way we think about it is we look at our cap liability on a monthly basis, and then we do a formal calculation on a quarterly basis. And the expense that flows through the income statement is basically the difference in that liability for that quarter.

So it's a little hard to predict, as we saw in the third quarter, which ended up being a benefit for us..

Okay.

And so what did you do in those 2 care centers that improved your cap exposure so materially, then?.

Well, it was an increase in admissions, which has a significant impact on that cap liability. And so by them produce -- by them improving the operations of that care center by increasing the ADC in that care center for admissions, you end up with a situation where your cap liability declines, without getting too far into the weeds on cap liability..

Okay. And then the other modeling topic I just wanted to broach was just the D&A seemed a little lower than what we modeled.

So what was the adjustment? And can you just give us a sense for what you think a more normalized D&A figure might be?.

It was a little bit lower. We anticipate it, going forward, would be roughly in the same kind of range as we go forward, and part of it was AMS3..

Okay. All right. And then, I guess, my bigger-picture question for Ron here.

Is the hospice unit salable?.

Well, Darren, that's a good question often asked. We know there are assets, we believe, that are in the market that may give an indication of that. I'll tell you that we're pleased to have this hospice operation as part of our portfolio. It's a -- we think there's opportunity to continue to improve -- or it ought to improve [indiscernible].

And as part of the continuum of care, we're happy to have it and pleased to continue to develop it and improve performance. And with that, that's how we're viewing this segment of our operations at this time..

Darren, I'll comment on that you ask about depreciation, did I want to clarify. For the rest of this year, we don't -- we see the depreciation being relatively sustainable. Going into '15 and beyond, we will begin to depreciate AMS3, and that will have some impact on depreciation as we go forward, increasing depreciation as we go forward..

[Operator Instructions] Your next question comes from the line of Kevin Ellich with Piper Jaffray..

Just wanted to get your updated view on the competitive landscape. There's been a lot of things going on in the industry with consolidation, I guess. Strategically, we're starting to see some operational improvement from you guys. Just wondering where you stand.

And I guess, what are your thoughts on use of the capital at this point?.

Well, great question, Kevin. I'll tell you that, certainly, our focus has been and will continue to improve operations.

We're certainly pleased to have kind of sustained what we did in the second quarter, our performance in the second quarter and into the third, and now, I think, have more of a stable operating environment, and so we're pleased with that.

There are things going on in the industry, things we've talked about and kind of witnessed for a long time and different views around the acceleration of that. Our view will still be to put ourselves in a better position to act when appropriate on strategic opportunities.

And with that, really, we want to put our -- both our operations and our capital structure, improve those to the point where, when those things come about that make sense to us, we'll be able to act. And I think the foundation of good operation, certainly, directionally, is a good thing..

And in the short run -- this is Dale. In the short run, we will continue to take our free cash flow and reduce our debt structure as we go forward, which then leads you back to Ronnie's earlier comments that it puts us in a position from a strategic standpoint to make decisions in the future..

That's great.

Dale, can you give us a reminder, what's your availability on your credit facility?.

Right now, it's about $50 million, a little over $50 million..

Okay, great. And then just wanted to see if we got -- can get an update. Do you guys still have any home health centers or locations that are kind of underperforming? Just wondering if we're through that cycle..

We still have a group, a lower-volume group, that certainly remains in our focus and to -- where the biggest issue is volume, to continue to grow that top line, which will then yield better performance. So it's a small group. As we've talked about before, our efforts continue. So there's some that are still there..

Do you think you can actually improve that group? Or do you think there's going to be a point where we see maybe a few more closures or sales of locations, Ronnie?.

Our view is still that there's an opportunity to improve. As we progress, those efforts are always evaluated, and we assess the opportunity to ultimately make progress. I won't tell you that they will never be -- can guarantee that we'll never have another closure or consolidation.

We'll always be looking to make our portfolio more efficient, and so that will remain in front of us. But we operate them today because we think we have an opportunity, and we just need to work to realize that..

Your next question comes from the line of Ralph Giacobbe with Crédit Suisse..

One, I guess, just want to be clear.

The non-Medicare, that's where you capture Medicare Advantage, is that correct?.

Yes, that's correct..

Okay. And then at this point, what percentage of -- is that all largely Medicare Advantage when we look at that book? Or is there other factors within that? So if I look at that volume number and put it over sort of that plus the Medicare, that's a percentage of sort of your MA book.

Is that the way to think about it?.

I think that's correct. There are several parts in the non-Medicare. It's -- we have Medicare Advantage, we have commercial, and in that, we also have some PPS, some episodic business that's non-Medicare episodic business. So it's an accumulation of all, largely driven, I would say, by the MA volume with larger payers..

Okay.

And I guess, when I look at that, is there a reason to think the non-Medicare business should be different than the Medicare business on some of these metrics? Or do you think that they'll merge? I guess I was looking at the visits per completed episode on the Medicare side, and I'm trying to sort of triangulate that to what that number would be on sort of the non-Medicare piece.

Is there a reason to think acuity levels -- or there should be differences in sort of visits per either episode or per admission?.

No, it's a great question. And we don't disclose a lot of detail around that. Let me tell you generally, Ralph, that what we're doing with that is responding to the needs of the different payers. And so one thing that could be different is there are different -- there could be specific utilization protocols and caps for different payers.

We'll be responsive to that. So give it consideration that it's not always a direct parallel from a visit per patient to achieve outcomes. So that is -- we're continuing to develop that to gain the efficiency and to gain actual efficiency of responding to different payers..

Okay. And I guess I don't know if -- maybe it's difficult to be a question to answer.

But when a life moves from sort of the fee-for-service to the Medicare side, can you help us think through the economics? Right, because you've done a great job on the cost side of the business, and we're starting to see stabilization on the revenue line, certainly, which is encouraging.

But I guess, as there's more of a push and penetration with MA continues and accelerates, I'm just trying to understand the dynamics of the top line because you talked about room for improvement.

I guess I'm just trying to balance room for improvement on sort of the cost side relative to revenue with what could be structural pressures in terms of a shift to Medicare Advantage..

Sure. Let me say that, overall, what we want to do, bottom line, is grow EBITDA, and then do that in an efficient fashion. There's -- but no question that there are different economics within a Medicare episode, generally, and our revenue per visit or our revenue off of a non-Medicare patient, generally speaking.

You can look at that in just kind of the face of our disclosures on the Medicare side. We -- for the quarter, we were at $2,834 of revenue per episode in 17 -- just over 17 visits. That's a revenue per visit of $164. When you look at our non-Medicare book, if you will, that revenue is kind of $100 -- in the mid $120s.

So we'll work to -- and of course, and I'll also say the economics on the non-Medicare piece, different collection issues, little more challenging, not necessarily the same efficiency of collection at this point with our Medicare business.

So we're cognizant of all of that, working to improve the margins in the non-Medicare piece because we think there are opportunities to continue to grow that. Certainly, there's a shift, a continuing shift in enrollment in Medicare Advantage. That population is growing.

So we think there are opportunities, and our goal is to continue developing the efficiency in that line of business. And so we understand the economics are different with the rate cuts in Medicare. Those will, I guess, over time, converge, absent -- notwithstanding the efficiencies that we hope to achieve inside of a Medicare episode.

But there's definitely, at this stage, different economics per patient..

Okay. All right, that's fair. And then maybe you can help us on the savings side.

Can you break out or parse out how much in savings would you suggest is sort of coming from shutting underperforming assets versus sort of actual cost reductions? I guess, specific to that other G&A line, I mean -- that, on an absolute dollar basis, we're looking at 15%, 20% reduction in that.

So I'm just trying to get a sense of, one, how much is it from just shedding underperforming assets? And then second, what cost line items within other are really seeing that level of significant savings? Where is that coming from?.

Well, I would comment on 2 things. This is Dale. I'd comment on 2 things. One is, since we are primarily a service organization, a lot of the savings came from salary reductions from closed care -- closed or consolidated care centers. In addition, we've looked at a lot of our G&A lines that are not salary-related and going through those.

But the lion's share of it probably came from, basically, personnel costs..

But that wouldn't be in the salaries and benefits line? You mean just other non-nurse-related costs?.

No, I'm talking about kind of benefit cost -- personnel costs across the board, both in corporate and in the field. And some of that is overhead cost, some of that is skilled nursing cost that -- in care centers that we close, to the extent that we were able to, when we consolidated care centers, we kept most of the clinician staff.

And as you'll recall, at least in the -- ones that we closed and consolidated in the spring, about half of those were closures, a little over 50, as I recall. And about half of those were closures, and about half of those were consolidations..

Okay. All right, that's helpful. And then just my last one. Just want to go to the interest expense line.

Just want to make sure, is this kind of the run rate we should think about into fourth quarter? And then you talked about debt paydown, so I'm just -- I know you're not giving guidance at this point, but can you help us at least directionally in terms of an absolute value, if we should think about interest expense somewhere along these levels at sort of a stepped-up function? Or is it going to start to sort of trail off as you pay down debt?.

Well, there's a couple of things moving there. One is that, in that interest expense in the fourth quarter -- I mean, excuse me, in the third quarter, there was about $0.5 million in deferred financing fees that we wrote off through that number.

So as we continue to delever the company going forward, I think you will see that number somewhat decline going into the fourth quarter and into next year.

And the reason for -- the primary reason for the increase, beyond the written-off deferred financing fees, is that the interest rate on the financing that we did in the summer is higher than what we are paying on our bank facilities..

Got it. So I mean, if we take that out, it looks like the interest expense is running at just under 2.5. So I guess, on a go-forward basis, that'd be the baseline, and we could sort of trail it off from that level.

Is that fair?.

I think that's generally true, yes..

Your final question comes from the line of Frank Morgan with RBC Capital Markets..

Most of my questions have been answered, but back to the point about the group of underperforming assets. Is there a general range of, say, what the EBITDA contribution or negative EBITDA contribution that group of assets carries? And what would be the potential if you decide to divest those? That's number one -- or close those.

And then number two is, you talked about the outlook on the traditional fee-for-service Medicare rates and the differences between that and the commercial or Medicare Advantage rate.

Is there anything you can do from a staffing model perspective to preserve that EBITDA, given the disparity in the rates?.

So Frank, as far as your first question on the portfolio, it generates a small group, lower volume. We've got them down to -- there's a minimal impact collectively. So as we put that -- kind of cluster that group, I think we've got it down into a manageable range in that respect.

But we certainly see and want to improve that collectively and individually. So again, that's the way we're certainly looking at it, is to improve that operation, turn that group collectively positive and then, individually, all positive at some point. And if that just can't happen, then we'll certainly deal with that at the appropriate time.

And so overall, the -- going back to your second question about the overall economics. We'll be working in both non-Medicare and in the Medicare, and I think that, over time, our view is there'll be some conversions just external to us.

And what we need to do is respond in much the same way but in some unique ways -- different ways, I should say, for each opportunity where I think there are growth opportunities. So we need to capture market share on the Medicare and continue to participate in this growing, what we call, non-Medicare or Medicare Advantage opportunity.

So clearly, the -- as I said, the economics are a little different, but I think there's an opportunity to grow EBITDA in total and certainly do it at the margin in an efficient way..

But nothing different from a staffing perspective that you could implement on that side of the business?.

Well, nothing that I would -- that I want to point to at this time. Certainly, it's part of our development of how we care for those patients, how we achieve the outcomes for the patients as required by the different payers, how we achieve that in the most efficient fashion.

So that will be emerging, we think, over time, but nothing that I want to -- am ready to articulate at this moment..

And your final question does come from the line of Whit Mayo with Robert Baird..

It doesn't sound like you guys are endorsing a savings figure with respect to the branch location closures anymore. And I was just going back through my notes, and I had a $16 million number sort of scribbled down and was kind of thinking maybe $8 million in 2014 and $8 million in 2015.

Can you just maybe go back and remind us and update us and clarify what you said about the savings figure around the branch location closures?.

Well, I guess I would say it this way. I think we have probably achieved most of what we set out to do related to those closed care centers. As I mentioned in my comments, there was about $1 million that sort of trailed out in the third quarter.

I think, by the time we get to the fourth quarter, we will have achieved pretty much what we anticipated or, put it another way, pretty much what we're going to get -- have gotten what we thought we would get out of closing the care and consolidating those care centers, and I think that will have all flowed through the operations by the fourth quarter of this year..

Okay, so whatever the additional targeted savings figure was, you've pretty much realized that opportunity at this point..

We've realized whatever we're going to get out of that as we move into the fourth quarter..

Got it. No, that's helpful. And then what about any headwinds this year that are probably nonrecurring going into 2015? And presumably, you have some consulting fees that hopefully aren't running into perpetuity.

So is there anything else to kind of call out that will be a cost that won't repeat into 2015?.

I think a lot of that was washed out in the third quarter. There were some issues that did come over into the third quarter. I think we mentioned a number of around $3 million in the second quarter that we weren't sure was going to reoccur. Probably $1 million of that did reoccur. So we're roughly $2 million better off.

There's some of that, that won't reoccur in the fourth quarter as we move forward. So there's some of that but not to the magnitude that we've seen in prior quarters..

Okay.

So when we think about the run rate, probably the best way to think of it is take the reported $23.8 million of EBITDA, you'll have maybe another $1 million of costs that you'll get back in terms of what's been bleeding out from the closures, and then maybe reduce that by another $1.5 million from the hospice cap benefit, and that's kind of the run rate at this point.

Is that fair?.

Well, we're not going to get into specifically giving you guidance on those issues, but I think we've told you some of the pieces that you should be thinking about..

Okay. And maybe 1 or 2 other ones. Just you've made some changes to your clinician comp model in the past 6 months, and I wanted to just get an update on how many of your branch locations or clinicians at this point are on pay-per-visit versus maybe where you were 3 to 6 months ago.

And is that still an opportunity going forward?.

No, we had -- good question. Appreciate the question. I think that we're in the range of probably the more sustained model that we've operated under, and that's about 90% of our clinicians are probably on a per-visit model as opposed to -- that's, of course, in home health. I'm talking about 90% on per visit versus hour.

And that's probably where, generally speaking, where it will be sustained..

Okay. And maybe one last one here. Just the final DOJ payment, can you just remind us when you'll be funding that? I just couldn't find the date in my notes..

Yes, we'll tell you when we're going to be funding that. That was last week. That's all done. We paid -- the total was about $35.8 million. We funded part of that out of our revolving credit facility.

But as you may recall, in calculating our leverage ratios, we've been using the entirety of the DOJ settlement, whether we had funded it or not, beginning in the third quarter of last year.

So our leverage ratios have declined as we go through because we've paid down almost $50 million, not counting the DOJ settlement, since the first quarter of this year..

Can you just maybe remind me on what the bank-defined leverage is? I know you were getting a number of add-backs in the definition..

It's basically EBITDA -- straight EBITDA plus -- and you add back noncash compensation. And to the extent that there are restructuring costs, et cetera, there's a rolling $10 million limit on that number. So the Street number is -- I'm sorry, the bank ratio does give us a higher EBITDA number than the Street number..

Can you give us what the leverage ratio is as of September 30?.

Yes, it's 2.1% -- 2.1x..

And there are no further questions at this time. I'd like to turn the call back over to Ronnie LaBorde for closing remarks..

Stephanie, thank you. And I'd like to thank everyone who joined us on our call today. We sincerely appreciate the interest in our company, and we look forward to updating you on our next quarterly earnings call, which will be in early 2015. Have a great day..

This concludes today's conference call. You may now disconnect..