Encompass Health Corp

Previous wording

We are the nation’s largest owner and operator of inpatient rehabilitation hospitals (“IRFs”) in terms of patients treated, revenues, and number of hospitals. We provide specialized rehabilitative treatment on an inpatient basis. We operate IRFs in 39 states and Puerto Rico, with concentrations in Florida and Texas. As of March 31, 2026, we operated 174 IRFs. For additional information about our business, see Part I, Item 1, Business, and Item 1A, Risk Factors, of the 2025 Form 10‑K.

Current wording

We are the nation’s largest owner and operator of inpatient rehabilitation hospitals (“IRFs”) in terms of patients treated, revenues, and number of hospitals. We provide specialized rehabilitative treatment on an inpatient basis. We operate IRFs in 39 states and Puerto Rico, with concentrations in Florida and Texas. As of June 30, 2026, we operated 176 IRFs. For additional information about our business, see Part I, Item 1, Business, and Item 1A, Risk Factors, of the 2025 Form 10‑K.

Previous wording

During the three months ended March 31, 2026, Net operating revenues increased 9.0% over the same period of 2025 due primarily to volume growth and increased pricing. See “Results of Operations” section of this Item for additional volume and pricing information.

Current wording

During the three and six months ended June 30, 2026, Net operating revenues increased 9.6% and 9.3%, respectively, over the same periods of 2025 due primarily to volume growth and increased pricing. See “Results of Operations” section of this Item for additional volume and pricing information.

Previous wording

In our continued development and expansion efforts during the three months ended March 31, 2026, we:

Current wording

In our continued development and expansion efforts during the six months ended June 30, 2026, we:

Previous wording

•expanded our capacity by adding 44 new beds to existing hospitals; and

Current wording

•expanded our capacity by adding 54 new beds to existing hospitals; and

Previous wording

We also continued our shareholder distributions during the three months ended March 31, 2026 through common stock repurchases and paying a quarterly cash dividend. For additional information see the “Liquidity and Capital Resources” section of this Item.

Current wording

We also continued our shareholder distributions during the six months ended June 30, 2026 through common stock repurchases and paying a quarterly cash dividend. For additional information see the “Liquidity and Capital Resources” section of this Item.

Previous wording

•Changes in Medicare Reimbursement and Regulatory Requirements for Operating IRFs. On April 2, 2026, the Centers for Medicare & Medicaid Services (“CMS”) released its notice of proposed rulemaking for fiscal year 2027 for IRFs (the “2027 Proposed IRF Rule”) under the inpatient rehabilitation facility prospective payment system. The 2027 Proposed IRF Rule would implement a net 2.4% market basket increase (market basket update of 3.2% reduced by a productivity adjustment of 0.8%) effective for discharges between October 1, 2026 and September 30, 2027. The 2027 Proposed IRF Rule also includes changes that impact our hospital-by-hospital base rate for Medicare reimbursement. Such changes include, but are not limited to, revisions to the wage index, updates to outlier payments, and updates to the case-mix group relative weights and average lengths of stay values. Based on our analysis that utilizes the acuity of our patients annualized over a twelve-month period ended February 28, 2026, our experience with outlier payments over this same time frame, and other factors, we believe the 2027 Proposed IRF Rule would result in a net increase to our Medicare payment rates of approximately 2.4% effective October 1, 2026.

Current wording

•Changes in Medicare Reimbursement and Regulatory Requirements for Operating IRFs. On July 30, 2026, the Centers for Medicare & Medicaid Services (“CMS”) released its notice of final rulemaking for fiscal year 2027 for IRFs (the “2027 Final IRF Rule”) under the inpatient rehabilitation facility prospective payment system. The 2027 Final IRF Rule will implement a net 2.3% market basket increase (market basket update of 3.2% reduced by a productivity adjustment of 0.9%) effective for discharges between October 1, 2026 and September 30, 2027. The 2027 Final IRF Rule also includes changes that impact our hospital-by-hospital base rate for Medicare reimbursement. Such changes include, but are not limited to, revisions to the wage index, updates to outlier payments, and updates to the case-mix group relative weights and average lengths of stay values. The 2027 Final IRF Rule also made updates and clarifications to certain IRF operational requirements. Based on our analysis that utilizes the acuity of our patients annualized over a twelve-month period ended June 30, 2026, our experience with outlier payments over this same time frame, and other factors, we believe the 2027 Final IRF Rule will result in a net increase to our Medicare payment rates of approximately 2.3% effective October 1, 2026.

Previous wording

In August 2023, IRFs located in Alabama began participation in CMS’s review choice demonstration (“RCD”), under which Medicare reimbursement claims are assessed for compliance with applicable coverage and clinical documentation requirements. On June 17, 2024, CMS expanded RCD to include IRFs located in Pennsylvania and billing to a certain Medicare Administrative Contractor (“MAC”). We do not bill to this MAC, so we are not subject to RCD in Pennsylvania at this time. In December 2025, CMS announced the expansion of RCD to Texas and California, effective March 2, 2026 and May 1, 2026, respectively. With the expansion to those two states, we expect 33 of our current inpatient rehabilitation hospitals (representing approximately 11.9% of our IRF Medicare claims) to be subject to RCD. After the initial four states, CMS intends to expand the demonstration to include additional cohorts of IRFs based on the MAC to which those IRFs submit claims. There are no details of that expansion at this time.

Current wording

In August 2023, IRFs located in Alabama began participation in CMS’s review choice demonstration (“RCD”), under which Medicare reimbursement claims are assessed for compliance with applicable coverage and clinical documentation requirements. On June 17, 2024, CMS expanded RCD to include IRFs located in Pennsylvania and billing to a certain Medicare Administrative Contractor (“MAC”). At that time, we did not bill to that MAC, so we were not subject to RCD in Pennsylvania. However, beginning in January 2027, we expect to have two newly opened Pennsylvania IRFs submitting claims under RCD. On March 2, 2026 and May 1, 2026, RCD expanded to Texas and California, respectively. As of June 30, 2026, we have 33 of our IRFs (representing approximately 11.9% of our IRF Medicare claims) subject to RCD. After the initial four states, CMS may expand the demonstration to include additional cohorts of IRFs based on the MAC to which those IRFs submit claims. There are no details of that expansion at this time.

Previous wording

Our consolidated Net operating revenues increased during the three months ended March 31, 2026 compared to the same period of 2025 primarily due to increased volumes and favorable pricing. Discharge growth included a 1.6% increase in same-store discharges. Discharge growth from new stores during the three months ended March 31, 2026 compared to the same period of 2025 resulted from our joint ventures in Athens, Georgia (March 2025), Fort Myers, Florida (May 2025), and Amarillo, Texas (November 2025), as well as our wholly owned hospitals in Daytona Beach, Florida (July 2025), Danbury, Connecticut (September 2025), St. Petersburg, Florida (October 2025), Lake Worth, Florida (December 2025), and Irmo, South Carolina (March 2026). Growth in net patient revenue per discharge during the three months ended March 31, 2026 compared to the same period of 2025 primarily resulted from an increase in reimbursement rates, retroactive cost reporting adjustments, and patient mix.

Current wording

Our consolidated Net operating revenues increased during the three months ended June 30, 2026 compared to the same period of 2025 primarily due to increased volumes and favorable pricing. Discharge growth included a 2.8% increase in same-store discharges. Discharge growth from new stores during the three months ended June 30, 2026 compared to the same period of 2025 resulted from our joint ventures in Fort Myers, Florida (May 2025) and Amarillo, Texas (November 2025), as well as our wholly owned hospitals in Daytona Beach, Florida (July 2025), Danbury, Connecticut (September 2025), St. Petersburg, Florida (October 2025), Lake Worth, Florida (December 2025), Irmo, South Carolina (March 2026), and Concordville, Pennsylvania (May 2026). Growth in net patient revenue per discharge during the three months ended June 30, 2026 compared to the same period of 2025 primarily resulted from an increase in reimbursement rates and patient mix.

Previous wording

The increase in other revenue during the three months ended March 31, 2026 included an increase of $15.3 million in Medicaid supplemental payments (partially offset by an increase of $9.7 million in provider tax expenses included in Other operating expenses). Medicaid supplemental payments represent amounts received under state directed and supplemental payment programs associated with Medicaid. For additional information, see Part I, Item 1, Business, “Medicaid Reimbursement,” of the 2025 Form 10‑K.

Current wording

The increase in other revenue during the three and six months ended June 30, 2026 included an increase of $2.9 million and $18.2 million, respectively, in Medicaid supplemental payments (offset by an increase of $14.4 million and $24.1 million, respectively, in provider tax expenses included in Other operating expenses). Medicaid supplemental payments represent amounts received under state directed and supplemental payment programs associated with Medicaid. For additional information, see Part I, Item 1, Business, “Medicaid Reimbursement,” of the 2025 Form 10‑K.

Previous wording

Salaries and benefits increased during the three months ended March 31, 2026 compared to the same period of 2025 primarily due to salary and benefit cost increases for our employees and increased patient volumes, including an increase in the number of full-time equivalents as a result of our development activities. Salaries and benefits decreased as a percent of Net operating revenues during the three months ended March 31, 2026 compared to the same period of 2025 primarily due to an increase in Medicaid supplemental payments and decreases in both contract labor and sign-on and shift bonuses.

Current wording

Salaries and benefits increased during the three and six months ended June 30, 2026 compared to the same periods of 2025 primarily due to salary and benefit cost increases for our employees and increased patient volumes, including an increase in the number of full-time equivalents as a result of our development activities. Salaries and benefits decreased as a percent of Net operating revenues during the three and six months ended June 30, 2026 compared to the same periods of 2025 primarily due to a decline in EPOB and decreases in both contract labor and sign-on and shift bonuses.

Previous wording

Other operating expenses increased in terms of dollars and as a percent of Net operating revenues during the three months ended March 31, 2026 compared to the same period of 2025 primarily due to increased provider taxes and higher costs resulting from our development activities partially offset by lower legal costs.

Current wording

Other operating expenses increased in terms of dollars and as a percent of Net operating revenues during the three and six months ended June 30, 2026 compared to the same periods of 2025 primarily due to increased provider taxes, as discussed above, and higher costs resulting from our development activities.

Previous wording

General and administrative expenses increased in terms of dollars and as a percent of Net operating revenues during the three months ended March 31, 2026 compared to the same period of 2025 primarily due to higher costs associated with our transition to a new enterprise resource planning system, Oracle Fusion, in 2025.

Current wording

General and administrative expenses increased during the three and six months ended June 30, 2026 compared to the same periods of 2025 primarily due to higher costs associated with our transition to a new enterprise resource planning system, Oracle Fusion, in 2025.

Previous wording

Depreciation and amortization increased during the three months ended March 31, 2026 compared to the same period of 2025 due to our capital investments. See the “Executive Overview” section of this item for information related to our development activity. We expect Depreciation and amortization to increase going forward as a result of our recent and ongoing capital investments.

Current wording

Depreciation and amortization increased during the three and six months ended June 30, 2026 compared to the same periods of 2025 due to our capital investments. See the “Executive Overview” section of this item for information related to our development activity. We expect Depreciation and amortization to increase going forward as a result of our recent and ongoing capital investments.

Previous wording

Other income during the three months ended March 31, 2026 includes a $17.5 million gain as a result of the sale of our 50% membership interest in Gamma Knife Center at Barnes-Jewish Hospital, LLC (“Gamma Knife”) to our existing joint venture partner, Barnes-Jewish Hospital, LLC, effective January 1, 2026. For additional information, see Note 1, Basis of Presentation, to the condensed consolidated financial statements included in Part I, Item 1, Financial Statements (Unaudited), of this report.

Current wording

Other income during the six months ended June 30, 2026 includes a $17.5 million gain as a result of the sale of our 50% membership interest in Gamma Knife Center at Barnes-Jewish Hospital, LLC (“Gamma Knife”) to our existing joint venture partner, Barnes-Jewish Hospital, LLC, effective January 1, 2026. For additional information, see Note 1, Basis of Presentation, to the condensed consolidated financial statements included in Part I, Item 1, Financial Statements (Unaudited), of this report.

Previous wording

Our pre-tax income from continuing operations increased during the three months ended March 31, 2026 compared to the same period of 2025 primarily due to the increase in Net operating revenues as discussed above.

Current wording

Our pre-tax income from continuing operations increased during the three and six months ended June 30, 2026 compared to the same periods of 2025 primarily due to the increase in Net operating revenues as discussed above.

Previous wording

Our Provision for income tax expense increased during the three months ended March 31, 2026 compared to the same period of 2025 primarily due to higher Income from continuing operations before income tax expense.

Current wording

Our Provision for income tax expense increased during the three and six months ended June 30, 2026 compared to the same periods of 2025 primarily due to higher Income from continuing operations before income tax expense.

Previous wording

We currently estimate our cash payments for income taxes to be approximately $160 million to $190 million, net of refunds, for 2026. These payments are expected to primarily result from federal and state income tax expenses based on estimates of taxable income for 2026.

Current wording

We currently estimate our cash payments for income taxes to be approximately $180 million to $200 million, net of refunds, for 2026. These payments are expected to primarily result from federal and state income tax expenses based on estimates of taxable income for 2026.

Previous wording

The increase in Net income attributable to noncontrolling interests during the three months ended March 31, 2026 compared to the same period of 2025 resulted from increased profitability from certain existing joint venture hospitals.

Current wording

The increase in Net income attributable to noncontrolling interests during the three and six months ended June 30, 2026 compared to the same periods of 2025 primarily resulted from increased profitability from certain existing joint venture hospitals.

Previous wording

As of March 31, 2026, we had $110.5 million in Cash and cash equivalents. This amount excludes $52.9 million in Restricted cash and $146.3 million of restricted marketable securities ($37.1 million included in Other current assets and $109.2 million included in Other long-term assetsin our condensed consolidated balance sheet). Our restricted assets pertain primarily to obligations associated with our captive insurance company, as well as obligations we have under agreements with joint venture partners. See Note 3, Marketable Securities, to the accompanying condensed consolidated financial statements included in Part I, Item 1, Financial Statements (Unaudited), of this report, and Note 3, Cash and Marketable Securities, to the consolidated financial statements accompanying the 2025 Form 10‑K.

Current wording

As of June 30, 2026, we had $107.7 million in Cash and cash equivalents. This amount excludes $25.8 million in Restricted cash and $159.6 million of restricted marketable securities ($52.4 million included in Other current assets and $107.2 million included in Other long-term assetsin our condensed consolidated balance sheet). Our restricted assets pertain primarily to obligations associated with our captive insurance company, as well as obligations we have under agreements with joint venture partners. See Note 3, Marketable Securities, to the accompanying condensed consolidated financial statements included in Part I, Item 1, Financial Statements (Unaudited), of this report, and Note 3, Cash and Marketable Securities, to the consolidated financial statements accompanying the 2025 Form 10‑K.

Previous wording

In addition to Cash and cash equivalents, as of March 31, 2026, we had approximately $726 million available to us under our revolving credit facility. Our credit agreement governs our senior secured borrowing capacity and contains a leverage ratio and an interest coverage ratio as financial covenants. Our leverage ratio is defined in our credit agreement as the ratio of consolidated total debt (less cash on hand) to Adjusted EBITDA for the trailing four quarters. In calculating the leverage ratio under our credit agreement, we are permitted to use pro forma Adjusted EBITDA, the calculation of which includes historical income statement items and pro forma adjustments, subject to certain limitations, resulting from (1) dispositions and repayments or incurrence of debt and (2) investments, acquisitions, mergers, amalgamations, consolidations and other operational changes to the extent such items or effects are not yet reflected in our trailing four-quarter financial statements. Our interest coverage ratio is defined in our credit agreement as the ratio of Adjusted EBITDA to consolidated interest expense, excluding the amortization of financing fees, for the trailing four quarters. As of March 31, 2026, the maximum leverage ratio requirement per our credit agreement was 4.50x and the minimum interest coverage ratio requirement was 3.0x, and we were in compliance with these covenants. Based on Adjusted EBITDA for the trailing four quarters and the interest rate in effect under our credit agreement during the three-month period ended March 31, 2026, if we had drawn on the first day and maintained the maximum amount of outstanding draws under our revolving credit facility for that entire period, we would still be in compliance with the maximum leverage ratio and minimum interest coverage ratio requirements.

Current wording

In addition to Cash and cash equivalents, as of June 30, 2026, we had approximately $746 million available to us under our revolving credit facility. Our credit agreement governs our senior secured borrowing capacity and contains a leverage ratio and an interest coverage ratio as financial covenants. Our leverage ratio is defined in our credit agreement as the ratio of consolidated total debt (less cash on hand) to Adjusted EBITDA for the trailing four quarters. In calculating the leverage ratio under our credit agreement, we are permitted to use pro forma Adjusted EBITDA, the calculation of which includes historical income statement items and pro forma adjustments, subject to certain limitations, resulting from (1) dispositions and repayments or incurrence of debt and (2) investments, acquisitions, mergers, amalgamations, consolidations and other operational changes to the extent such items or effects are not yet reflected in our trailing four-quarter financial statements. Our interest coverage ratio is defined in our credit agreement as the ratio of Adjusted EBITDA to consolidated interest expense, excluding the amortization of financing fees, for the trailing four quarters. As of June 30, 2026, the maximum leverage ratio requirement per our credit agreement was 4.50x and the minimum interest coverage ratio requirement was 3.0x, and we were in compliance with these covenants. Based on Adjusted EBITDA for the trailing four quarters and the interest rate in effect under our credit agreement during the three-month period ended June 30, 2026, if we had drawn on the first day and maintained the maximum amount of outstanding draws under our revolving credit facility for that entire period, we would still be in compliance with the maximum leverage ratio and minimum interest coverage ratio requirements.

Previous wording

Operating activities. The increase in Net cash provided by operating activities for the three months ended March 31, 2026 compared to the same period of 2025 primarily resulted from an increase in Net income which was driven by growth in Net operating revenues.

Current wording

Operating activities. The increase in Net cash provided by operating activities for the six months ended June 30, 2026 compared to the same period of 2025 primarily resulted from an increase in Net income which was driven by growth in Net operating revenues.

Previous wording

Investing activities. The decrease in Net cash used in investing activities during the three months ended March 31, 2026 compared to the same period of 2025 primarily resulted from increased Proceeds from sale of restricted investments partially offset by increased Purchases of restricted investments. Proceeds from sale of restricted investments during the three months ended March 31, 2026 includes $17.9 million resulting from the sale of our 50% membership interest in Gamma Knife. For additional information, see Note 1, Basis of Presentation, to the condensed consolidated financial statements included in Part I, Item 1, Financial Statements (Unaudited), of this report.

Current wording

Investing activities. The increasein Net cash used in investing activities during the six months ended June 30, 2026 compared to the same period of 2025 primarily resulted from increased Purchases of property, equipment, and intangible assets.

Previous wording

Financing activities. The decrease in Net cash used in financing activities during the three months ended March 31, 2026 compared to the same period of 2025 primarily resulted from higher net debt borrowings, partially offset by higher Repurchases of common stock, including fees and expensesand Distributions paid to noncontrolling interests of consolidated affiliates. For additional information on our net debt borrowings, see Note 4, Long-term Debt, to the accompanying condensed consolidated financial statements included in Part I, Item 1, Financial Statements (Unaudited), of this report, and Note 8, Long-term Debt, to the consolidated financial statements accompanying the 2025 Form 10‑K. For additional information related to our stock repurchases, see the “Authorizations for Returning Capital to Stakeholders” section below.

Current wording

Financing activities. The decrease in Net cash used in financing activities during the six months ended June 30, 2026 compared to the same period of 2025 primarily resulted from higher net debt borrowings, partially offset by higher Repurchases of common stock, including fees and expensesand Distributions paid to noncontrolling interests of consolidated affiliates. For additional information on our net debt borrowings, see Note 4, Long-term Debt, to the accompanying condensed consolidated financial statements included in Part I, Item 1, Financial Statements (Unaudited), of this report, and Note 8, Long-term Debt, to the consolidated financial statements accompanying the 2025 Form 10‑K. For additional information related to our stock repurchases, see the “Authorizations for Returning Capital to Stakeholders” section below.

Previous wording

Our capital expenditures include costs associated with our hospital renovation program, de novo projects, capacity expansions, technology initiatives, and building and equipment upgrades and purchases. During the three months ended March 31, 2026, we made capital expenditures of approximately $162 million for property, equipment, and intangible assets. During 2026, we expect to spend approximately $920 million to $995 million for capital expenditures using cash on hand and borrowings under our revolving credit facility. Approximately $225 million to $240 million of this budgeted amount is considered nondiscretionary expenditures, which we may refer to in other filings as “maintenance” expenditures. Actual amounts spent will be dependent upon the timing of development projects. At March 31, 2026, we have projects under construction which have an estimated additional cost to complete over the next two years of approximately $367 million. We expect to fund capital expenditures using cash on hand and borrowings under our revolving credit facility.

Current wording

Our capital expenditures include costs associated with our hospital renovation program, de novo projects, capacity expansions, technology initiatives, and building and equipment upgrades and purchases. During the six months ended June 30, 2026, we made capital expenditures of approximately $383 million for property, equipment, and intangible assets. During 2026, we expect to spend approximately $920 million to $995 million for capital expenditures using cash on hand and borrowings under our revolving credit facility. Approximately $225 million to $240 million of this budgeted amount is considered nondiscretionary expenditures, which we may refer to in other filings as “maintenance” expenditures. Actual amounts spent will be dependent upon the timing of development projects. At June 30, 2026, we have projects under construction which have an estimated additional cost to complete over the next two years of approximately $422 million. We expect to fund capital expenditures using cash on hand and borrowings under our revolving credit facility.

Previous wording

In October 2025 and February 2026, our board of directors declared cash dividends of $0.19 per share that were paid in January 2026 and April 2026, respectively. We expect quarterly dividends to be paid in January, April, July, and October. However, the actual declaration of any future cash dividends, and the setting of record and payment dates as well as the per share amounts, will be at the discretion of our board of directors after consideration of various factors, including our capital position and alternative uses of funds. Cash dividends are expected to be funded using cash flows from operations, cash on hand, and availability under our revolving credit facility.

Current wording

In October 2025, February 2026, and May 2026, our board of directors declared cash dividends of $0.19 per share that were paid in January 2026, April 2026, and July 2026, respectively. On July 23, 2026, our board of directors approved an increase in our quarterly dividend and declared a cash dividend of $0.21 per share, payable on October 15, 2026 to stockholders of record on October 1, 2026. We expect quarterly dividends to be paid in January, April, July, and October. However, the actual declaration of any future cash dividends, and the setting of record and payment dates as well as the per share amounts, will be at the discretion of our board of directors after consideration of various factors, including our capital position and alternative uses of funds. Cash dividends are expected to be funded using cash flows from operations, cash on hand, and availability under our revolving credit facility.

Previous wording

In 2013, we announced our board of directors authorized the repurchase of up to $200 million of our common stock, which has been amended from time to time. Most recently, on July 24, 2024, our board approved resetting the aggregate common stock repurchase authorization to $500 million. As of March 31, 2026, approximately $261 million remained under this authorization. The repurchase authorization does not require the repurchase of a specific number of shares, has an indefinite term, and is subject to termination at any time by our board of directors. Subject to certain terms and conditions, including a maximum price per share and compliance with federal and state securities and other laws, the repurchases may be made from time to time in open market transactions, privately negotiated transactions, or other transactions, including trades under a plan established in accordance with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended. During the three months ended March 31, 2026, we repurchased 0.7 million shares of our common stock in the open market for $71.6 million under this repurchase authorization using cash on hand. Future repurchases under this authorization generally are expected to be funded using a combination of cash on hand and availability under our $1 billion revolving credit facility. For additional information, see Part II, Item 2, Unregistered Sales of Equity Securities and Use of Proceeds, of this report.

Current wording

In 2013, we announced our board of directors authorized the repurchase of up to $200 million of our common stock, which has been amended from time to time. On July 24, 2024, our board increased the aggregate common stock repurchase authorization to $500 million. As of June 30, 2026, approximately $188 million remained under this authorization. On July 23, 2026, our board approved an increase in the aggregate common stock repurchase authorization to $1.0 billion. The repurchase authorization does not require the repurchase of a specific number of shares, has an indefinite term, and is subject to termination at any time by our board of directors. Subject to certain terms and conditions, including a maximum price per share and compliance with federal and state securities and other laws, the repurchases may be made from time to time in open market transactions, privately negotiated transactions, or other transactions, including trades under a plan established in accordance with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended. During the six months ended June 30, 2026, we repurchased 1.4 million shares of our common stock in the open market for $145.8 million under this repurchase authorization using cash on hand. Future repurchases under this authorization generally are expected to be funded using a combination of cash on hand and availability under our $1 billion revolving credit facility. For additional information, see Part II, Item 2, Unregistered Sales of Equity Securities and Use of Proceeds, of this report.

Previous wording

Our indebtedness under our credit agreement and the 4.50% Senior Notes due 2028, 4.75% Senior Notes due 2030, and 4.625% Senior Notes due 2031, (collectively, the “Senior Notes”) are guaranteed by certain consolidated subsidiaries. These guarantees are full and unconditional and joint and several, subject to certain customary conditions for release. The Senior Notes are guaranteed on a senior, unsecured basis by all of our existing and future subsidiaries that guarantee borrowings under our credit agreement and other capital markets debt. The other subsidiaries of Encompass Health do not guarantee the Senior Notes (such subsidiaries are referred to as the “non-guarantor subsidiaries”).

Current wording

Our indebtedness under our credit agreement and the 4.50% Senior Notes due 2028, 4.75% Senior Notes due 2030, 4.625% Senior Notes due 2031, and 5.875% Senior Notes due 2034 (collectively, the “Senior Notes”) are guaranteed by certain consolidated subsidiaries. These guarantees are full and unconditional and joint and several, subject to certain customary conditions for release. The Senior Notes are guaranteed on a senior, unsecured basis by all of our existing and future subsidiaries that guarantee borrowings under our credit agreement and other capital markets debt. The other subsidiaries of Encompass Health do not guarantee the Senior Notes (such subsidiaries are referred to as the “non-guarantor subsidiaries”).