Acadia Healthcare Co. Inc. (Nasdaq: ACHC) pulled in record-setting patient volumes in the year’s first quarter.

The Franklin, Tennessee-based behavioral health company also saw workforce trends and payer rates improve. Combined, these factors helped boost the company’s pre-tax earnings by about 12%. These operating advancements and environmental trends portend well for Acadia Healthcare’s ambition to double revenue by 2028, the company’s leaders said on its first-quarter earnings call on Thursday.

“We are well positioned to maintain our strong growth trajectory and meet our development targets for calendar 2023,” Chris Hunter, Acadia Healthcare CEO, said on the call.

Acadia Healthcare plans to add 670 new beds to the company’s capacity this year. The expansion of existing facilities will account for 300 of the new beds, with the remaining coming from two de novo inpatient facilities, two joint venture facilities and at least six additional comprehensive treatment centers (CTCs), Acadia’s outpatient medication-assisted treatment (MAT) locations.

The sunny outlook and improved workforce and payer trends appear similar to comments made by the management of King of Prussia, Pennsylvania-based Universal Health Services on that company’s latest earnings call.

Acadia Healthcare is the largest pure-play behavioral health care provider in the U.S. It operated 250 facilities with about 11,000 beds in 39 states and Puerto Rico at the end of 2022.

The company’s labor costs increased by 7.1% year-over-year in the first quarter, compared to a rate increase of 8% in the previous quarter. Hunter said this increase was in line with the company’s expectations and expects wage inflation to taper off more as staff wage increases come into effect and the need for higher-cost contract staffing decreases.

“The pay adjustments that we put in place in the back half of 2022 got us to a point where we’re at market [rate], and I think really set us up for the rest of the year,” Hunter said. “I do think that we have also seen some real improvement in recruiting and retention trends, which has also enabled our labor costs to be a little bit more stable.”

Hunter pointed out that the company was able to keep wage increases in line with expectations while increasing patient volumes to record levels.

Other workforce efforts include more partnerships between Acadia Healthcare and nursing schools, centralizing support for nurse recruiting, investments in clinical role and degree programs and tuition reimbursement, Hunter said.

Acadia Healthcare saw revenue increase by 14% to $704 million and net income increase by 7.5% to $67 million.

David Duckworth, Acadia Healthcare’s CFO, said maintaining a strong financial position will be a key focus while the company grows. The company has a relatively low net leverage ratio of 2.2.

“We remain focused on disciplined cost management across our operations, and we will continue to pursue a disciplined capital allocation strategy that supports organic growth as well as opportunistic acquisitions,” Duckworth said.

Neither Duckworth nor Hunter mentioned previously unknown deals on the call.

While earnings increased, corporate expenses increased as well. Hunter said Acadia Healthcare previously “underinvested” in key areas that enable growth, such as technology, human resources, marketing and payer relations. He added that Acadia has already seen a benefit from the higher costs — pointing to record volumes — and will continue to see benefits in the long term.

These expenses include rolling out an electronic medical record (EMR). While they are a standard part of physical health care settings, EMRs are much less prevalent in behavioral health. Previously, Hunter said the company would invest in an EMR and other tech systems to improve its operations, including improving referrals within Acadia’s facilities.

Federal research finds that between 30% and 40% of private behavioral health providers store any patient information in an EMR and take Medicaid.

Acadia Healthcare completed a six-hospital EMR pilot program, Hunter said. He didn’t detail when that happened or what facilities were involved. And while the company is still parsing through pilot results, the EMR will benefit the company’s facilities.

The new EMR system has increased employee satisfaction, improved safety and compliance, and enhanced patient experiences. It also provides valuable data for nascent outcomes measurement efforts and cost savings on paper and storage, ultimately improving business efficiency, Hunter added

“We continue to be very optimistic about these investments that we’re making,” Hunter said. “We don’t think we’re going to have to wait several years to see the benefit.”