The leaders at Enhabit Inc. (NYSE: EHAB) are tracking the various headwinds that could negatively affect home-based care providers, including the proposed 2026 Medicare payment rule, but the company has drafted a plan to mitigate growing challenges.

The company’s leaders have focused on its advanced visit-per-episode management strategy to offset rate disruptions.

“Whether it is CMS pricing or continued shift [with] Medicare Advantage, we must be as efficient as possible to have necessary resources to strategically invest in people and technology,” President and CEO Barb Jacobsmeyer said Thursday during the company’s third quarter earnings call. “Therefore, our cost structure is critical to future success.”

Dallas-based Enhabit has 249 home health locations and 114 hospice locations across 34 states.

The company first implemented its advanced visit-per-episode management pilot in mid-August at 11 of its branches. Jacobsmeyer called the early results promising, citing a decline in total visits-per-episode in these locations.

In October, the company added more branches to this pilot, and plans to include more by the end of November.

“As we navigate a dynamic operating environment, we remain confident that Enhabit is best positioned in the industry, with our experienced leaders, high-performing teams and innovative technology to manage their challenges and continue growing market share,” Jacobsmeyer said.

Enhabit is also still seeing positive momentum from its payer innovation strategy, with sequential improvements in its total patient census.

“Our scale drives meaningful access to payer members, and that access, coupled with our high-quality outcomes, continues to position us well for progress within our payer strategy,” Jacobsmeyer said. “This was evident by another renegotiated national payer contract during the third quarter. This was the renegotiation of one of our first payer innovation agreements.”

Enhabit has also seen success with its de novo growth strategy. In Q3, the company opened six locations, and a seventh in October. The company is slated to open 10 locations via organic growth this year.

Like most home health companies, the 2026 proposed payment rule, which has yet to be finalized, is a primary concern for Enhabit.

“As we noted in our comment letter, the proposed cuts, if finalized, will worsen the existing trend of reduced patient access to home health care,” Jacobsmeyer said. “Home health is the patient’s preferred and most cost-effective post-acute care option, and thus saves Medicare money. We urge CMS to reverse the temporary and permanent adjustments contained in the proposed rule to ensure adequate access to home health is restored.”

Still, Jacobsmeyer stressed that the company will continue implementing strategies to mitigate pricing challenges in 2026.

Enhabit’s leaders have previously identified a silver lining within the proposed rule: new opportunities for growth.

After setting its sights on improving the financial health of the business in 2025, Enhabit reported record revenues and profitability in Q3.

In Q3, Enhabit’s net service revenue checked in at $263.6 million, a 3.9% increase from $253.6 million compared to the same period last year.

“Our ability to deliver growth and profitability for the third straight quarter in what remains a challenging operating environment highlights the consistency in our operational execution and flexibility in our model, even as payer disruptions created headwinds early in the quarter,” Ryan Solomon, chief financial officer of Enhabit, said during the call. “Our teams navigated the challenges, effectively ensuring that we built momentum throughout the quarter to deliver growth and position as well, as we entered Q4 to finish the year strong.”