After closing more than 80 centers over the last year, LifeStance (Nasdaq: LFST) is taking a measured approach to growth.
The outpatient mental health provider plans to open no more than 10 de novo facilities by the end of the year. That estimate is down from its initial expectation of opening no more than 20 in 2024.
“These updates reflect our increased emphasis on profitable growth and disciplined capital deployment,” Dave Bourdon, chief financial officer at LifeStance, said during the company’s Q2 earnings call.
Still, the taper growth plan appears to be paying off. On its Q2 earnings call, the company reported a 20% year-over-year revenue growth to $312 million.
The leadership team attributed this result to higher total revenue per visit and increased visit volume. According to Bourdon, visit volumes were primarily driven by clinician growth. The company added 118 net clinicians in the second quarter, bringing its total clinician base to 6,984. The visit volume also increased in Q2 by 15% to 2 million.
Bourdon noted that while the company’s facility expansion plan is modest, there is still a lot of room for capacity growth within its current footprint.
“We feel good about the footprint that we have right now,” Bourdon said. “We did some right sizing of that last year with consolidation of centers. We’re only going to add less than 10 de novos this year. So, we have a pretty stable footprint this year. There is still a lot of capacity in our footprint. When you look across the country, there are local geographies where we’ve successfully recruited and have high patient utilization. Those are the areas where we continue to need to grow de novos. I would expect it to be more of the same next year, where we’ll have a modest amount of de novo ads while we continue to grow into our footprint.”
While rapidly building out brick-and-mortar facilities may not be the company’s priority, LifeStance is slightly moving towards more in-person patient care visits. The company revealed a 1.5% increase in in-person versus virtual visits last year. Burdick said roughly 71% of visits were virtual and 29% were in-person in the last quarter.
As part of its retention and recruitment efforts, it rolled out a new operational initiative last month that standardizes processes across the organization. This includes standardizing job descriptions, staffing numbers and resources across local markets.
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