Encompass Health Corp (NYSE: EHC)

Encompass Health Corp is the nation’s largest owner and operator of inpatient rehabilitation hospitals. The company provides specialized rehabilitative treatment using advanced technology and intensive therapy on an inpatient basis for patients recovering from a major injury or illness who seek to regain functional ability independence and quality of life. It operates hospitals in 39 states and Puerto Rico with concentrations in Florida and Texas. As of December 31 2025 Encompass Health Corp operated 173 inpatient rehabilitation hospitals containing 11,465 licensed beds. The company is committed to delivering high quality cost effective patient care. In 2025 it was named America’s Most Awarded Leader in Inpatient Rehabilitation by Newsweek and Statista and ranked among Fortune’s World’s Most Admired Companies and Forbes’ Most Trusted Companies in America.

Encompass Health Corp generates revenue primarily from payments for patient care services received from federal and state government programs and private insurers. In 2025 inpatient rehabilitation services produced $5,756.3 million of net operating revenues while other sources contributed $178.9 million for a total of $5,935.2 million. The payer mix shows Medicare accounting for 65.4% of revenues Medicare Advantage for 16.4% managed care for 10.7% Medicaid for 3.1% other third party payors for 0.7% Workers' compensation for 0.5% patients for 0.3% and other income for 2.9%. Revenues are generated under the Medicare inpatient rehabilitation prospective payment system which pays a fixed amount per discharge based on patient case mix and under negotiated rates with private insurers and public programs.

Encompass Health Corp holds a leading position in the inpatient rehabilitation industry as the largest owner and operator of such hospitals by patients treated revenues and number of facilities. Its competitive advantages arise from strong clinical outcomes cost effectiveness financial strength and extensive application of technology. The company differentiates itself through a culture focused on quality a disciplined operating model and scale that enables data driven process improvements. Competitors mainly consist of rehabilitation units located within acute care hospitals numerous privately held providers and one public company that operates 38 inpatient rehabilitation hospitals across the United States. Nursing homes that offer limited rehabilitation services also compete for some patients. The company’s size its focus on evidence based protocols and its ability to adapt to regulatory changes help it maintain its market standing.

Encompass Health Corp serves patients who are admitted to its hospitals following physician referrals from acute care hospitals. Approximately 92% of its patients come from acute care settings after experiencing conditions such as strokes hip fractures traumatic brain injuries spinal cord injuries or other neurological disorders that require intensive rehabilitation therapy. The majority of patients are Medicare beneficiaries aged 65 and older with an average age of about 77. The payer mix includes Medicare Medicare Advantage managed care plans Medicaid Workers' compensation and other third party payors as well as direct patient payments. Demographic trends indicate that the population aged 75 and older is expected to grow at roughly 4% per year through 2030 supporting long term demand for the company’s services. Specific customer names are not disclosed in the filing but the base comprises individual patients and the various insurance and government programs that reimburse for rehabilitation care.