Good morning and thank you for joining us today for Select Medical Holdings Corporation's Earnings Conference Call to discuss the third quarter 2012 results and the company's business outlook. Speaking today are the company's CEO, Robert Ortenzio; and the company's Executive Vice President and Chief Financial Officer, Martin Jackson. Management will give you an overview of the quarter highlights and then open the call for questions. Before we get started, we would like to remind you, that this conference call may contain forward-looking statements regarding future events or the future financial performance of the company, including, without limitations, statements regarding operations results, growth opportunities and other statements that refer to Select's plans, expectations, strategies, intentions and beliefs. These forward-looking statements are based on the information available to management of Select Medical today and the company assumes no obligation to update these statements as circumstances change. At this time, I would like to turn the conference call over to Robert Ortenzio.

Thank you, operator. Good morning, everyone, and thanks for joining us for Select Medical Holdings' Third Quarter Earnings Conference Call for 2012. For our prepared remarks, I'll provide some overall highlights for the company and our existing -- and our operating divisions, and ask Martin Jackson to provide some additional financial details before opening the call up for questions. In our earnings press release issued last night, the company announced that our Board of Directors declared a special cash dividend of $1.50 per share to be paid on or about December 12 to all stockholders of record at the close of business on December 5, 2012. The company's cash flow continues to be strong and we expect approximately $100 million of the $210 million required to pay the dividend will come from cash-on-hand, with the balance being drawn from our revolving credit facility. As you know, over the past 2 years, the company has repurchased close to 22.5 million shares of its common stock and continues to look for ways to enhance value to our shareholders. The dividend allows us to return capital to our shareholders, without limiting our ability to pursue other opportunities. Our reported earnings per fully diluted share were $0.17 in the third quarter. However, this included a non-recurring loss on early retirement of debt. Excluding this loss and the related tax effect, our adjusted earnings per fully diluted share were $0.20 in the third quarter compared to earnings per share in the third quarter of last year of $0.17. Net revenue for the third quarter increased 2.8% to $713.7 million compared to the same quarter last year. During the quarter, we generated approximately 74% of our revenues from our specialty hospital segment, which includes both our long-term acute care and inpatient rehab hospitals, and 26% from our outpatient rehabilitation segment, which include both our outpatient clinics and our contract services. Net revenue in our specialty hospitals for the third quarter increased 2% to $531.4 million compared to the same quarter last year. The increase was the result of increases in our net revenue per patient day, partially offset by a decline in patient volumes. Specialty hospital net revenue per patient day increased 2.9% to 1,517 in the third quarter compared to 1,474 per patient day in the same quarter last year. The increase in net revenue per patient day is related to increases in both our average Medicare and non-Medicare net revenue per patient day. Our patient days at the third quarter declined 1.3% to 328,871 days, and overall occupancy rates were 69% in the third quarter compared to 71% in the same quarter last year. During the third quarter, approximately 84% of our specialty hospital revenue came from our long-term acute care hospitals and 16% from our rehab hospitals. Net revenue in our outpatient rehabilitation segment for the third quarter increased 5.3% to $182.2 million compared to the same quarter last year. Revenue in our clinic-based business, including our owned and managed clinics, increased 1% in the third quarter compared to the same quarter last year. The increase was driven by volume growth in our owned clinics as patient visits increased 2.7% compared to the same quarter last year, and our net revenue per visit was flat at $103 per visit. The increase in our owned clinic revenue, was partially offset by a reduction in fees associated with our managed clinics. Revenue on our contract services business increased 21.2% in the third quarter compared to the same quarter last year. This increase was primarily the result of the addition of a group of new contracts that were added in the fourth quarter last year. During the third quarter, approximately 76% of our outpatient revenue came from our owned and managed clinics and 24% from our contract services. Overall, adjusted EBITDA for the third quarter increased 1.4% to $87.7 million compared to $86.5 million in the same quarter last year, with overall adjusted EBITDA margins at 12.3% for the third quarter compared to 12.5% margins for the same quarter last year. Specialty hospital adjusted EBITDA for the third quarter increased 2.6% to $83.7 million compared to $81.6 million in the same quarter last year. The improvement in adjusted EBITDA in the quarter was a result of operating improvements in the Regency hospitals, increases in management services fees and lower bad debt expense. Adjusted EBITDA margins for the specialty hospital segment were flat at 15.7%, in both the third quarter and last year. Outpatient rehabilitation adjusted EBITDA for the third quarter increased 4.7% to $20.4 million compared to $19.4 million in the same quarter last year. Adjusted EBITDA margins for the outpatient segment were flat at 11.2% in both the third quarter this year and last year. For the clinic portion of our business, adjusted EBITDA increased 4.1% to $17.9 million and adjusted EBITDA margins increased to 13% compared to 12.6% in the same quarter last year. The increase in adjusted EBITDA in our Clinic business is attributable to our volume increase and a reduction in bad debt expense, which was partially offset by increases in labor costs. For our contract services, adjusted EBITDA increased 9.5% to $2.5 million and adjusted EBITDA margins were 5.6% in the third quarter compared to 6.2% in the same quarter last year. Our contract services margin decline was a result of increased relative labor costs associated with lower productivity related to new business. I'd like to make a couple other comments. Last night, CMS released the final Medicare fee schedule rule for calendar year 2013, which includes payments for our outpatient rehab providers. Recall Medicare represents approximately 10% of our outpatient rehab segment revenues. While we are still reviewing the details of the rule, the final rule calls for a 4% update to therapy rates, which is slightly better than the 3% in the proposed rule. In addition, I know many of you have been following the progress of the LTAC criteria bills working their way through Congress. Let me offer just a few thoughts on this. In mid-September, the American Hospital Association finalized a new version of the proposed certification criteria for the nation's long-term acute care hospitals. As many of you may remember, last year, Senator Pat Roberts and Senator Bill Nelson and 8 other senators introduced or sponsored Senate Bill 1486, which was based in large part on proposals developed by the AHA. After the Congressional Budget Office, or CBO, raised a number of policy questions, Senator Roberts and Senator Nelson asked the AHA to revise their policy proposals. For the past 6 months, the AHA has worked to do so. Select Medical has been happy to support the AHA's efforts. I won't try to prognosticate about the legislation's chances for passage in the last quarter of this year. Congress is not scheduled to return to Washington until mid-November and the lame duck session could be brief and will definitely be highly unpredictable. But having said that, I will say that the senators who support our hospitals, working with the AHA, have built some momentum for LTAC criteria bill and we intend to do what we can to help secure its passage. At this point, I'll turn it over to Marty Jackson, our Chief Financial Officer, to cover some additional financial highlights for the quarter and the full year before we return for questions.

Thanks, Bob. For the quarter, our operating expenses, which include our cost to service, general and administrative costs and bad debt expense increased 3.1% to $627.3 million compared to the same quarter last year. As a percentage of our net revenue, operating expenses for the quarter were 87.9%, a slight increase compared to 87.7% in the same quarter last year. Cost of services, a major component of which is labor, were $599 million in the third quarter. As a percentage of net revenue, cost of services was 83.9% for the third quarter compared to 83.8% in the same quarter last year. The increase in cost of services as a percentage of net operating revenue resulted primarily from increased relative labor costs in both our specialty hospital and our outpatient rehabilitation segment. This increase in relative labor costs resulted from increased labor costs associated with the Baylor JV services agreement, increased staffing costs in our hospital and lower productivity in our contract services business. G&A expense was $17.1 million in the third quarter which, as a percentage of net revenue, was 2.4%. This compares to $15 million or 2.2% of revenue for the same quarter last year. Bad debt, as a percent of net revenue, was 1.6% for the third quarter. This compares to 1.7% for the same quarter last year. The decrease in bad debt as a percentage of revenue occurred across both our operating segments and is attributable to favorable collections experience of accounts receivable during the quarter. As Bob mentioned, total adjusted EBITDA was $87.7 million for the third quarter and adjusted EBITDA margins were 12.3%, which compared to adjusted EBITDA of $86.5 million and 12.5% adjusted EBITDA margins in the same quarter last year. Depreciation and amortization expense was $15.5 million in the third quarter. This compares to $17.5 million in the same quarter last year. The decline in our depreciation and amortization expense was affected by decreases in depreciation expense related to assets that were revalued at the time of Select's LBO in 2005 and also assets acquired from HealthSouth, which have now both been fully depreciated. We generated $1.2 million in equity and earnings during the quarter. This compares to $1.7 million in the same quarter last year. The decline in equity and earnings is related to start-up losses incurred by companies that provide specialized technology to health care entities where we hold a minority interest. Interest expense, net of interest income, was $24.6 million in the third quarter, up slightly from $24 million in the same quarter last year. The increase is primarily related to a refinancing we completed during the quarter. The company recorded income tax expense of $16.2 million in the third quarter, which represents an effective tax rate of 39.2%. This compares to an effective tax rate of 42.3% in the same quarter last year. The decline in our effective tax rate is primarily the result of a higher effective rate in the same quarter last year associated with the hospital swap we completed in January of 2011, a reduction in the provision for uncertain tax positions and a lower effective state tax rate. Net income attributable to Select Medical was $24.1 million in the third quarter, and fully-diluted earnings per share were $0.17. And excluding the loss retirement on debt, its related tax effects, adjusted earnings per share were $0.20. We ended the quarter with $1.34 billion of debt outstanding and $49.7 million of cash in the balance sheet. On August 13, we entered into an extension amendment under our senior secured credit facility and borrowed an aggregate principal amount of $275 million in incremental term loans. On September 12, we used proceeds from the term loan extension to redeem $275 million of the principal of our 7 5/8% senior subordinated notes due 2015. Our debt balances at the end of the quarter include $1,098,800,000 of term loans, which is net of $14.9 million of the original issued discount, $167.3 million of a holdco senior floater rate notes; $70 million of the 7 5/8% senior subnotes, with the balance of $5.5 million consisting of other miscellaneous debt. Operating activities provided $75.3 million of cash flow in the third quarter. This compares to $60.4 million in the third quarter of last year. The provision of cash was primarily the result of cash earnings and reductions in our accounts receivable, which was offset in part by reductions in our accrued expenses. Overall our day sales outstanding, or DSO, remains flat at 51 days at September 30, 2012, this compares to June 30, 2012. Operating activities provided $194.1 million of cash flow to-date. This compares to $143.9 million in the same period last year. Provision of cash was primarily the result of cash earnings, reductions in our accounts receivable and increases in income and deferred taxes. Investing activities used $18.5 million of cash flow in the third quarter. The use of cash was primarily related to property improvements and equipment purchases of $17.3 million and acquisition-related payments of $1.3 million. Investing activities used $40.1 million of cash flow year-to-date. The use of cash was related to property improvements and equipment purchases of $45.2 million, business investment payments of $9.9 million related primarily to an additional investment in the Baylor JV, and $1.5 million acquisition-related payments. The use of cash was partially offset by $16.5 million in proceeds related to the sale of the building. Financing activities used $28.6 million of cash in the third quarter. The use of cash primarily resulted from the refinancing activities during the quarter as well as $6.8 million of repayments of bank overdrafts, $2.3 million in payments of other debt, $2.8 million amortization payment on our term loans, and $1.3 million in distributions to non-controlling interests, offset by $600,000 of proceeds from stock issuance. Financing activities used $116.3 million of cash year-to-date. The use of cash resulted from $40 million in net repayments on our revolving credit facility, $46.8 million in repurchase of common stock, $16 million in original issued discounts, fees and premiums and debt issuance costs related to the debt refinancing in the third quarter, $7.1 million in amortization payments on our term loans, $3 million in the repayment of bank overdrafts, $3 million in distributions to noncontrolling interests and $1.6 million in net repayments of other debt. This was offset in part by $1.1 million in proceeds from the issuance of common stock. During the third quarter, we did not repurchase any shares under our share repurchase program. Through September, we have spent a total of $163.6 million of the $250 million authorized under the share repurchase program to repurchase almost 22.5 million shares of common stock at an average price per share of $7.28, including transaction costs. As Bob mentioned, on October 30, our Board of Directors declared a special cash dividend of $1.50 per share. The company expects to use approximately $100 million of cash-on-hand towards the repayment -- towards the payment of the dividend with the balance coming from the borrowings under our revolving credit facility which, at the end of the third quarter, was undrawn. Our leverage as of September 30 was 3.35x through the holding company and while we expect the dividend to modestly increase leverage, our leverage levels after payment of the dividend will remain at very comfortable levels. I also wanted to reaffirm the financial guidance for calendar year 2012 that we provided in our press release, which includes net operating revenue in the range of $2.9 billion to $2.975 billion, adjusted EBITDA in the range of $400 million to $410 million. Fully diluted income per common share in the range of $0.99 to $1.04 and adjusted income per share in the range of $1.01 to $1.06, which excludes loss related to the early retirement of debt in the third quarter, and its related tax effects. This concludes our prepared remarks. And at this time, we'd like to turn it back to the operator to open up the call for questions.

[Operator Instructions] And your first question comes from the line of Kevin Fischbeck from Bank of America Merrill Lynch.

This is actually Joanna Gajuk filling in for Kevin today. The first question -- definitely that's good to see the special dividend. It's not totally expected given the pretty aggressive share repurchase earlier this year. And the question is, does this mean -- the dividend mean that we should expect less share repurchases going forward?

I don't think we ought to expect less share repurchases going on. And as you recall, we have $250 million of share buyback authorization, of which we used $164 million. And we will be very opportunistic, and we believe that we could potentially use the balance of that.

Great. And then on a different topic. Again, the volumes were weaker than on our model, and you made some comment around it. So -- but can you give us a little bit more color in terms of what caused the weak volumes. I mean we've heard from acute care hospitals in terms of what's going on there. But can you just give us more color from your perspective?

Sure. We think the lower volume is really reflective of the overall lower volume in the acute cares. As you may or may not know, over 97% of the admissions into our specialty hospitals come from acute cares. And so we think that a good portion of that is really just reflective of that lower volume in acute care levels.

Great. And just the last question on the subpoena that was disclosed in the 10-Q last night. Seems like there's something with this facility that keeps on coming back. So can you just talk about any implications of these subpoenas for the company?

Yes. I don't think there's any additional implication. I mean these investigational processes take a fairly predictable route, which is that's in the investigative phase and as the government wants more information, they request the information through subpoenas. That's just the way they do it. So I think that as this thing moves along, we'll continue to see requests for additional information, which we're cooperating with. I mean our policy is to, even though we disclosed the investigation at that individual hospital, we continue to update our disclosure and I think provide as much or more information than anybody does that has these types of investigations. So we'll continue to update the disclosure with any new information that we have.

Your next question comes from the line of A.J. Rice of UBS.

Just a couple of questions. First of all, your big competitor in the contract therapy area had mentioned that they were having some issues with the Medicare Part D therapy caps. Is there anything -- you haven't mentioned that. Is there anything going on there that has an impact on your business?

A.J., there has been some changes in the methodology that you have to use in order to see the patient. And it is more time-consuming. So just like a number of the other activities with Medicare, you just have to get used to it and incorporate that into your process.

But you're reaffirming guidance, so there’s nothing there that's meaningful enough from your perspective to make any changes or in outlook or trend?

That's correct.

Yes. And I think the other thing to keep in mind, A.J., is while we kind of tease it out in our disclosures, our contract therapy businesses is -- relative to the company is really not that big.

Right. That's right. Also just in the interest of making sure I'm on top of what's in the guidance, I don't know whether you had been able to assess whether you've had much impact from this Hurricane Sandy on your operations, but have you looked at that in terms of what implications it might have, if any, on the fourth quarter?

Yes. Let me address a part of that, A.J., is just for your information, we have 120 clinics in the Philadelphia and South Jersey area. It's probably our largest market. And they are branded under the NovaCare brand. And we have 85 clinics under the Kessler brand in Northern New Jersey. So obviously, we did have a lot of our operations in the path of the storm. And so we're continuing to look at that and our lost visits. But at this point, we can probably give you some estimate of what we think the impact will be in the fourth quarter.

A.J., the preliminary evaluation of that, we've got a range of somewhere in the neighborhood of $1.5 million to $2.5 million.

Okay. This is small item, but it does reflect on the Baylor JV. The equity in earnings of affiliates seemed to slip from the second quarter level. How is the Baylor JV doing? And is there any other items in that line item that we should know about that are impacting it?

Yes, there is, A.J. You can make the -- if you're making the assumption that Baylor's doing just fine, and they're doing the same or, if not, better than they did same quarter last year, that's a very good assumption. What we have done is we have purchased the minority shares in some companies that we actually use and they have some start-up losses. That's what's really reflecting in that line item, and the reduction in that rate.

Okay. And you would assume that those start-up losses would impact you for a few more quarters?

Yes.

Okay. All right. And then just finally, on the -- I know you sometimes have talked about Regency and where that stands relative to the Select legacy portfolio. Can you just comment on the relative performance, in any way, of the old Regency properties versus the Select, and where -- margin volume, et cetera?

We sure can. We are very pleased with the performance of the Regency hospitals. They are up, and they're at the same margins that our legacy Select hospitals are at right now. So we're very, very comfortable with that acquisition. It's been fully integrated. And as I said, we're comfortable with where it is right now.

Your next question comes from the line of Gary Lieberman of Wells Fargo.

Just last week, CMS reached a settlement with a provider group regarding the -- providing therapy to patients, even if it wasn't going to improve their condition and just to maintain their current condition. Can you talk about what impact, if any, that might have on your business?

At this point in time, Gary, we haven't really been able to kind of put a handle on that. Our expectation is that would impact us in our contract therapy area. But again, we haven't attached a number to that. Obviously, it's a positive event.

Yes. We haven't -- just a follow-up, I don't think we've made any changes in our business model based on that decision.

Okay. And any idea of how long it would take you to put some numbers around it?

Probably a couple of weeks.

As there are no further questions, we will turn it back over to management for closing remarks.

Okay. I'll just close by thanking you for joining us and look forward to updating you again next quarter.

Thank you for your participation in today's conference. This concludes the presentation. You may now disconnect and have a wonderful day.