Select Medical Holdings Corporation operates critical illness recovery hospitals, rehabilitation hospitals, and outpatient rehabilitation clinics in the United States.
As of December 31, 2024, the company had operations in several states and the District of Columbia. As of December 31, 2024, the company operated multiple critical illness recovery hospitals in various states, multiple rehabilitation hospitals in various states, and several outpatient rehabilitation clinics in multiple states and...
Select Medical Holdings Corporation operates critical illness recovery hospitals, rehabilitation hospitals, and outpatient rehabilitation clinics in the United States.
As of December 31, 2024, the company had operations in several states and the District of Columbia. As of December 31, 2024, the company operated multiple critical illness recovery hospitals in various states, multiple rehabilitation hospitals in various states, and several outpatient rehabilitation clinics in multiple states and the District of Columbia.
Segments
The company's critical illness recovery hospital segment consists of hospitals designed to serve the needs of patients recovering from critical illnesses, often with complex medical needs, and the company's rehabilitation hospital segment consists of hospitals designed to serve patients that require intensive physical rehabilitation care. Patients are typically admitted to the company’s critical illness recovery hospitals and rehabilitation hospitals from general acute care hospitals. The company's outpatient rehabilitation segment consists of clinics that provide physical, occupational, and speech rehabilitation services.
Critical Illness Recovery Hospitals
The company is an operator of critical illness recovery hospitals in the United States. The company's hospitals are certified by Medicare as long-term care hospitals (‘LTCHs’). As of December 31, 2024, the company operated multiple critical illness recovery hospitals in various states. For the year ended December 31, 2024, approximately 33% of the revenue of the company’s critical illness recovery hospital segment came from Medicare reimbursement.
The company operates the majority of its critical illness recovery hospitals as a hospital within a hospital (an ‘HIH’). A critical illness recovery hospital that operates as an HIH typically leases space from a general acute care hospital, or ‘host hospital,’ and operates as a separately licensed hospital within the host hospital, or on the same campus as the host hospital. In contrast, a free-standing critical illness recovery hospital does not operate on a host hospital campus. The company operated multiple critical illness recovery hospitals as of December 31, 2024, of which various were operated as HIHs and several were operated as free-standing hospitals.
Patients are typically admitted to the company’s critical illness recovery hospitals from general acute care hospitals, likely following an intensive care unit stay, and suffer from chronic critical illness. These patients have specialized needs, with serious and complex medical conditions involving multiple organ systems. These conditions are often a result of complications related to heart failure, complex infectious disease, respiratory failure and pulmonary disease, complex surgery requiring prolonged recovery, renal disease, neurological events, and trauma. Given their complex medical needs, these patients require a longer length of stay than patients in a general acute care hospital and benefit from being treated in a critical illness recovery hospital that is designed to meet their unique medical needs. For the year ended December 31, 2024, the average length of stay for patients in the company’s critical illness recovery hospitals was 31 days.
Additionally, the company continually seeks to increase its admissions by demonstrating its quality outcomes and, by doing so, expanding and improving its relationships with the physicians and general acute care hospitals in the markets where it operates. The company maintains a strong focus on the provision of quality medical care within its facilities. The Joint Commission (‘TJC’), DNV GL Healthcare USA, Inc. (‘DNV’), and the Center for Improvement in Healthcare Quality (‘CIHQ’) are independent accreditation organizations that establish standards related to the operation and management of healthcare facilities. As of December 31, 2024, the company operated critical illness recovery hospitals, some of which were accredited by TJC and few of which were accredited by DNV. Also, as of December 31, 2024, all of the company’s critical illness recovery hospitals were certified by Medicare as LTCHs. Each of the company’s critical illness recovery hospitals must regularly demonstrate to a survey team conformance to the standards established by TJC, DNV, CIHQ, or the Medicare program, as applicable.
When a patient is referred to one of the company’s critical illness recovery hospitals by a physician, case manager, discharge planner, or payor, a clinical assessment is performed to determine patient eligibility for admission. Based on the determinations reached in this clinical assessment, an admission decision is made.
Each of the company’s critical illness recovery hospitals has a distinct medical staff that is composed of physicians from multiple specialties that have successfully completed the required privileging and credentialing process. In general, physicians on the medical staff are not directly employed, but are more commonly independent, and practice at multiple hospitals in the community. Attending physicians conduct daily rounds on their patients while consulting physicians provide consulting services based on the specific medical needs of the company’s patients. Each critical illness recovery hospital develops on-call arrangements with individual physicians to help ensure that a physician is available to care for the company’s patients. When determining the appropriate composition of the medical staff of a critical illness recovery hospital, the company considers the size of the critical illness recovery hospital, services provided by the critical illness recovery hospital, and the size and capabilities of the medical staff of the general acute care hospital that hosts that HIH or the proximity of an acute care hospital to the free-standing critical illness recovery hospital. The medical staff of each of the company’s critical illness recovery hospitals meets the applicable requirements set forth by Medicare, the hospital’s applicable accrediting organizations, and the state in which that critical illness recovery hospital is located.
The company’s critical illness recovery hospital segment is led by a president, chief medical officer, chief nursing officer, and chief quality officer. Each of the company’s critical illness recovery hospitals has an onsite management team consisting of a chief executive officer, a medical director, a chief nursing officer, and a director of business development. These teams manage local strategy and day-to-day operations, including oversight of clinical care and treatment. They also assume primary responsibility for developing relationships with the general acute care providers and clinicians in the local areas the company serves that refer patients to its critical illness recovery hospitals. The company provides its critical illness recovery hospitals with centralized accounting, treasury, payroll, legal, operational support, human resources, compliance, management information systems, health information, credentialing, physician contracting support, and billing and collection services. The centralization of these services improves efficiency and permits staff at the company’s critical illness recovery hospitals to focus their time on patient care.
Critical Illness Recovery Hospital Strategy
The key elements of the company’s critical illness recovery hospital strategy are to focus on specialized inpatient services; provide quality care and service; control operating costs; increase commercial volume; and pursue opportunistic acquisitions.
Rehabilitation Hospitals
The company’s rehabilitation hospitals provide comprehensive physical medicine, as well as rehabilitation programs and services, which serve to optimize patient health, function, and quality of life. As of December 31, 2024, the company operated several rehabilitation hospitals in various states. For the year ended December 31, 2024, approximately 45% of the revenue of the company’s rehabilitation hospital segment came from Medicare reimbursement.
Patients at the company’s rehabilitation hospitals have specialized needs, with serious and often complex medical conditions requiring rehabilitative healthcare services in an inpatient setting. These conditions require targeted therapy and rehabilitation treatment, including comprehensive rehabilitative services for brain and spinal cord injuries, strokes, amputations, neurological disorders, orthopedic conditions, pediatric congenital or acquired disabilities, and cancer. Given their complex medical needs and gradual and prolonged recovery, these patients generally require a longer length of stay than patients in a general acute care hospital.
Additionally, the company continually seeks to increase its admissions by demonstrating its quality outcomes and, by doing so, expanding and improving its relationships with the physicians and general acute care hospitals in the markets where it operates. The company maintains a strong focus on the provision of quality medical care within its facilities. As of December 31, 2024, the company operated several rehabilitation hospitals, all of which were accredited by TJC. Also, as of December 31, 2024, some of the company’s rehabilitation hospitals were certified by Medicare as inpatient rehabilitation facilities (‘IRFs’). Some of the company’s rehabilitation hospitals also received accreditation from the Commission on Accreditation of Rehabilitation Facilities (‘CARF’), an independent, not-for-profit organization that establishes standards related to the operation of medical rehabilitation facilities. Each of the company’s rehabilitation hospitals must regularly demonstrate to a survey team conformance to the standards established by TJC, the Medicare program, or CARF, as applicable.
When a patient is referred to one of the company’s rehabilitation hospitals by a physician, case manager, discharge planner, health maintenance organization, or insurance company, the company performs a clinical assessment of the patient to determine. Based on the determinations reached in this clinical assessment, an admission decision is made.
Each of the company’s rehabilitation hospitals has a multi-specialty medical staff that is composed of physicians who have completed the privileging and credentialing process required by that rehabilitation hospital and have been approved by the governing board of that rehabilitation hospital. Physicians on the medical staff of the company’s rehabilitation hospitals are generally not directly employed by the company’s rehabilitation hospitals, but instead have staff privileges at one or more hospitals. At each of the company’s rehabilitation hospitals, attending physicians conduct rounds on their patients on a regular basis and consulting physicians provide consulting services based on the medical needs of the company’s patients. The company’s rehabilitation hospitals also have on-call arrangements with physicians to help ensure that a physician is available to care for the company’s patients. The company staffs its rehabilitation hospitals with the number of physicians, therapists, and other medical practitioners. When determining the appropriate composition of the medical staff of a rehabilitation hospital, the company considers the size of the rehabilitation hospital, services provided by the rehabilitation hospital, and the proximity of an acute care hospital to the free-standing rehabilitation hospital. The medical staff of each of the company’s rehabilitation hospitals meets the applicable requirements set forth by Medicare, the facility’s applicable accrediting organizations, and the state in which that rehabilitation hospital is located.
The company’s rehabilitation hospital segment is led by a president, chief medical officer, chief academic officer, chief nursing officer, and chief quality officer. Each of the company’s rehabilitation hospitals has an onsite management team consisting of a chief executive officer, a medical director, a chief nursing officer, a director of therapy services, and a director of business development. These teams manage local strategy and day-to-day operations, including oversight of clinical care and treatment. They also assume primary responsibility for developing relationships with the general acute care providers and clinicians in the local areas the company serves that refer patients to its rehabilitation hospitals. The company provides its facilities within its rehabilitation hospital segment with centralized accounting, treasury, payroll, legal, operational support, human resources, compliance, management information systems, health information, credentialing, physician contracting support, and billing and collection services. The centralization of these services improves efficiency and permits the staff at the company’s rehabilitation hospitals to focus their time on patient care.
Rehabilitation Hospital Strategy
The key elements of the company’s rehabilitation hospital strategy are to focus on specialized inpatient services; provide quality care and service; control operating costs; increase commercial volume; develop rehabilitation hospitals through pursuing joint ventures with healthcare systems; and pursue opportunistic acquisitions.
Outpatient Rehabilitation
The company is an operator of outpatient rehabilitation clinics in the United States based on the number of facilities, with multiple facilities throughout states and the District of Columbia as of December 31, 2024. The company’s outpatient rehabilitation clinics are typically located in a medical complex or retail location.
In the company’s outpatient rehabilitation clinics, it provides physical, occupational, and speech rehabilitation programs and services. The company also provides certain specialized programs, such as functional programs for work-related injuries, hand therapy, post-concussion rehabilitation, pelvic health rehabilitation, pediatric rehabilitation, cancer rehabilitation, and athletic training services. The typical patient in one of the company’s outpatient rehabilitation clinics suffers from musculoskeletal impairments that restrict his or her ability to perform normal activities of daily living. These impairments are often associated with accidents, sports injuries, work-related injuries, or post-operative orthopedic and other medical conditions. The company’s rehabilitation programs and services are designed to help these patients minimize physical and cognitive impairments and maximize functional ability. The company also provides services designed to prevent short-term disabilities from becoming chronic conditions. The company’s rehabilitation services are provided by its professionals, including licensed physical therapists, occupational therapists, and speech-language pathologists.
Outpatient rehabilitation patients are generally referred or directed to the company’s clinics by a physician, employer, or health insurer. In recent years, all states have enacted laws that allow individuals to seek outpatient physical rehabilitation services without a physician order. In the company’s outpatient rehabilitation segment, for the year ended December 31, 2024, approximately 82% of the revenue comes from commercial payors, including healthcare insurers, managed care organizations, workers’ compensation programs, contract management services, and private pay sources. The balance of the company’s reimbursement is derived from Medicare and other government-sponsored programs.
Outpatient Rehabilitation Strategy
The key elements of the company’s outpatient rehabilitation strategy are to provide quality care and service; increase market share; expand rehabilitation programs and services; optimize payor contract reimbursements; and pursue opportunistic acquisitions.
Other
Other activities include the company’s corporate administration and shared services, as well as employee leasing services with its non-consolidating subsidiaries. The company also holds minority investments in other healthcare-related businesses. These include investments in companies that provide specialized technology and services to healthcare entities, as well as providers of complementary services.
Competition
Companies operate critical illness recovery hospitals and rehabilitation hospitals that compete with the company’s own hospitals, including operators of similar facilities, such as ScionHealth and Encompass Health Corporation, and rehabilitation units and step-down units operated by acute care hospitals in the markets the company serves. The primary competitors that provide outpatient rehabilitation services include physician-owned physical therapy clinics, dedicated locally owned and managed outpatient rehabilitation clinics, and hospital or university-owned or affiliated ventures, as well as national and regional providers in select areas, including Athletico Physical Therapy, ATI Physical Therapy, U.S. Physical Therapy, and Upstream Rehabilitation.
Government Regulations
As of December 31, 2024, all of the critical illness recovery hospitals the company operated were certified by Medicare as LTCHs. As of December 31, 2024, some of the rehabilitation hospitals the company operated were certified by Medicare as IRFs. In addition, the company provides the majority of its outpatient rehabilitation services through outpatient rehabilitation clinics certified by Medicare as rehabilitation agencies or ‘rehab agencies,’ which operate as outpatient rehabilitation providers for the purposes of the Medicare program.
The company’s critical illness recovery hospitals and its rehabilitation hospitals receive accreditation from TJC, DNV, CIHQ, and/or CARF. As of December 31, 2024, all of the various critical illness recovery hospitals and all of the rehabilitation hospitals the company operated were accredited by TJC, DNV, or CIHQ. In addition, some of the company’s rehabilitation hospitals have also received accreditation from CARF.
The Department of Health and Human Services has adopted standards in three areas in which the company is required to comply that affect its operations. The company maintains a Privacy and Security Committee that is charged with evaluating and monitoring its compliance with The Health Insurance Portability and Accountability Act of 1996 (‘HIPAA’).
History
Select Medical Holdings Corporation was founded in 1996. The company was incorporated in 2004.
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