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• Take Private transaction: On March 2nd, Select Medical entered into an agreement to be acquired by a consortium led by its Executive Chairman, with unaffiliated shareholders to receive $16.50 per share in cash. The transaction is expected to close in mid - 2026 subject to regulatory approvals, etc. - Inpatient rehabilitation business expansion: So far in 2026, 166 beds have been added across three newly opened inpatient rehabilitation hospitals. Across the remainder of 2026 and into 2027, 275 more beds are expected to be added. Later in 2026, plans include opening a 60 - bed hospital with Atlanticare, two acute rehab units in Florida, and two neurotrauma units. Early 2027, expanding a Banner rehabilitation hospital by 20 beds, and later in 2027, opening a 76 - bed inpatient rehabilitation hospital in Jersey City and an acute rehab unit in Richmond, Virginia. - Capital allocation: Board of Directors approved a cash dividend of 6.25 cents per share payable on May 28. - Financial results: All three operating divisions delivered revenue growth, total revenue increased by 5%, adjusted EBITDA declined 6.5% to $141.6 million, earnings per common share was $0.35 compared to $0.44 prior year, and adjusted for private transaction costs was $0.36 per share.

Maintaining 2026 guidance. Continue to expect revenue to range between $5.6 billion and $5.8 billion and adjusted EBITDA between $520 million and $540 million. Fully diluted earnings per common share is expected to be in the range of $1.22 to $1.32. Capital expenditures are expected to range between $200 million and $220 million.

Inpatient Rehab Hospital Division: Revenue increased more than 14% year - over - year to approximately $351.9 million, while adjusted EBITDA increased 15% to $81.1 million. Revenue per patient day increased nearly 3%, average daily census grew 12%, occupancy increased to 83% from 82% in the prior year period, same - store occupancy increased to 87% from 83%, and adjusted EBITDA margin increased slightly to 23% compared to 22.9% last year. Critical Illness Recovery Hospital Division: Revenue increased to $638.8 million from $637 million in the prior year period. Adjusted EBITDA declined 15% to $73.4 million from $86.6 million in the prior year quarter, resulting in an adjusted EBITDA margin of 11.5% compared to 13.6% last year. Revenue per patient day increased by more than 2% and admissions increased 1%. Outpatient Rehabilitation Division: Revenue growth of more than 4% reached $321.3 million compared to $307.3 million in the prior year quarter. This is driven by over 4% growth in patient visits. Net revenue per visit was consistent with the prior year at $102. Adjusted EBITDA was $22 million compared to $24.3 million last year, resulting in an adjusted EBITDA margin of 6.8% compared to 7.9%.

• In Medicare Advantage space, seeing an increase in denials which impacted conversion rates in certain divisions like long - term acute care hospitals and inpatient rehab. - Exiting underperforming markets in the outpatient rehabilitation division resulted in approximately $1 million of costs in the first quarter due to closing clinics in Oregon.

Q: Touch on outpatient rehabilitation margin and operational improvements.

A: Tom mentioned they've been working on scheduling and schedule optimization for productivity increases, looking at underperforming markets and exiting those, with a million dollars of costs in the first quarter from exiting Oregon clinics and ongoing assessment of markets to consolidate and improve productivity.

Q: Broader commentary on efforts in Washington to address high - cost outlier issue.

A: Tom said they've been looking closely at high - cost outlier, encouraged by the proposed rule keeping it consistent with prior year, preliminary data shows running at or below the CMS threshold, projecting fixed loss threshold to come down in out years and focusing on lobbying efforts and conversations with CMS and House Ways and Means Committee.

Q: Seeing increase in denials from Medicare Advantage in patient rehab or outpatient.

A: Tom said saw decrease in conversion from Medicare Advantage in long - term acute care hospitals and inpatient rehab, more denials in Medicare Advantage space for hospitals, but commercial and Medicare conversions are improving.

Q: Worst margins in CRRH segment and recovery.

A: Mike said Medicare Advantage conversion rates down impacted volume, approximately $13 - $14 million impact year over year, critical illness is always difficult to project seasonally but expects to be within expectations for the rest of the year.

Q: Early read on impact of Medicare team model.

A: Mike said so far the Medicare team model has had very minor impact on inpatient rehab census, Tom agreed it's a very minor issue in rehab hospitals