PACS’ top financial leader is outlining three tactics he sees as key to the fast-growing company’s efforts to deliver high-quality patient care while seeking economies of scale across its footprint.
Investment in facilities that feel “life changing” is among the key strategies for the nursing home company, which is believed to be one of the country’s five largest.
“I’ve learned that ‘look good, feel good’ rings true in the post-acute care space, and PACS prioritizes investing in a state-of-the-art experience for our residents and their families through capital expenditures and remodels,” Derick Apt wrote in a post on the company’s website recently. “From patient rooms to common spaces, every part of our facilities can embody the quality of care we provide. As such, one of the most important investments post-acute care leaders can make is transforming their facilities into physical extensions of their commitment to bettering the lives of others.”
Apt joined PACS in 2018 as vice president of finance and treasury and, later, chief investment officer. He helped lead acquisition efforts for PACS ahead of the company’s move to go public earlier this year.
PACS previously highlighted its commitment to physical plant in its initial filings with the Securities Exchange Commission. In March, the company outlined its approach to capital improvements and maintenance, investing even in facilities it leases by supplying new furnishings and equipment.
“Our investments into medical beds, vitals monitors, physical therapy equipment, and other improvements allows us to provide services to higher-acuity patients,” company leaders wrote then. “We believe our high-quality facilities lead to sustained referral volumes, more admissions, and high skilled mix at our facilities, ultimately leading to higher occupancy rates and revenue per patient day. We also believe our investment into leased facilities makes us a preferred tenant with our landlords and provides us leverage in negotiating favorable lease terms.”
The company has continued rapid expansion since its $450 initial public offering, including the May pickup of 53 facilities formerly owned and operated by Prestige Care.
In PACS’ second-quarter earnings call earlier this month, CEO Jason Murray gave an example of that strategy paying off. The company acquired “a highly distressed facility” in California in the first quarter that had a census below 60%. By quickly and “heavily” investing in recruitment, training, and additional tools and resources to improve care, Murray said, the facility “earned a higher level of confidence in the community [and] as a result, during Q2, the facility achieved and maintained an average daily census of over 95% and had increased its skilled mix from less than 10% daily at acquisition to over 60.”
In his August post, Apt noted that the facilities also reflect PACS’ commitment to its staff.
“We’ve invested heavily in creating spaces reflective of the immense value our teams provide, from upgrading showers during the COVID-19 pandemic to refurbishing employee break rooms and lounges,” he wrote. “This has strengthened our culture and has improved delivery and outcomes. When staff feel taken care of, they feel empowered to take care of others.”
Also emphasized in Apt’s piece: promoting strong resident relationships through consistent teams (and driving agency use down to 2%) and improving quality through “nimble” data infrastructure.
