GoHealth (GOCO) 16 Mar 232022 Q4 Earnings call transcript

Good afternoon, and welcome to the GoHealth Fourth Quarter and Full Year 2022 Earnings Conference Call. My name is Lisa, and I will be your operator for today's call. [Operator Instructions] As a reminder, this conference is being recorded.

I would now like to turn the call over to John Shave, Vice President of Investor Relations. John, you may begin.

afternoon, good and you, everyone. Thank GoHealth's Thanks XXXX and Year Quarter Call. for joining Earnings Full Fourth

Joining Vijay today Chief me are Financial Jason Officer; Officer. Schulz, and Kotte, Chief Executive

predict. current forward-looking This will call to determine factors beyond these differ anticipated are may statements statements. expectations. those results Numerous the from future to projected based cause afternoon's results actual risks contains control company's that on or conference materially Many uncertainties and the or our ability in of

not reliance obligation our and update XXXX. quarter fourth these undue should otherwise. the market today, company new year or full of After and statements, You any forward-looking or closed to we place on any future for due undertakes to statements, of containing issued results the events the release information, a no whether revise press

our you have under reports forward-looking website our Form risk release, additional We have and the the listed consider Securities XX-K Form described posted a the the to XX-Q risk Investor information. that consider you on factors the with of press We Exchange other Commission in the and tab. In we for with should GoHealth number filed in conjunction encourage release Relations statements. factors

has contained completed the results are firm discussed registered its our In and addition, were audit. here in not by independent release accounting public management and prepared press unaudited our as

most financial measures are today's press reconciliations measures. this During call. the GAAP are this to release measures refer forth reconciliations non-GAAP measure most will to non-GAAP Please measures to These GAAP during set certain we release. financial directly the the of for and comparable call, discussing be discussed earnings the reconciled press comparable in

like and the that I'd the in section And For turn deck to Vijay. encourage provided have reference, the Relations a with over I you supporting that, slide to review. call GoHealth website, to exhibits of we Investor

our am proud and fourth year thank I us start how you team. earnings quarter our call. to John. for for want I full XXXX of joining saying Good Thank afternoon, you, and by off

agents partners, potential internal XXX,XXX in we in calls options, million their and a coverage and fourth our over external with plan. Medicare enrolled Our X quarter. beneficiaries, current fielded Medicare Together assessed over helped the

be has and digital insurance leading health been GoHealth continues health to and a Medicare-focused marketplace company.

technology, to plan Our with health build us of consumers unique the industry match with combination allows cutting-edge for right them and science is trusted them. data relationships expertise policy and health deep and that

AEP approached then I'll are past. for call, beyond discuss today's and a or XXXX. this of financial how XXXX review guidance. and recap XXXX, operating period, our Jason differently provide will On from season we in for annual success and why results brief our the positioned results enrollment we our and also I'll

GoHealth have we executed Jason of XXXX joined you know, made and second a and transformation As three AEP, changes many of during the of In advance company defined I half the of since several the executing goals and XXXX. clearly been operational strategic mid-last against we year.

model; and our prioritize agents. these sales delivered cash key of over operations; agents third, share on volume we areas. to in second, pleased maximize experienced, improve from more First, that efficiency focus flow high-quality I'm

in This ahead cash the first we operations a in of breakeven flow improvement achieved achieve flow XXXX, our Encompass shift better-than-expected of positive target but million on year economics full by was cash to For delivered the flow towards cash, operating Encompass efficiency. Jason from margin detail. which $XX will only our solution, our cash describe and half our of not more XXXX. improved driven also revenue,

and and our due of high-quality policy, marketing tenured conversion, per technology approach, our key effectuated on to performance improvement our measures, We the improvements. effectuation performance cost showed agents including disciplined margin profile, proprietary year-over-year planned-fit

improvement XX% strong than more plan delivered we results of operational actions, delivered laid advance operating we for in efficiency AEP AEP in we the you The year-over-year. these anticipated. out on Based

to like I'd to share how current of evolve. the and on thoughts expect Now how state we some it it's our changed market,

into our is evolving. of move diversification strategic time. This for because the an intentional figure to win through them the plan our is market as us to change over their Medicare In industry what seen broader an financial and the Encompass Our works have critical complex increasingly beneficiaries best diversification as solution health out lens needs challenges landscape. is ability market, option for

bombarded parties soon beneficiaries Medicare year during from as net original AEP are More again, Medicare nearly original messages Medicare to with are to they then Medicare thereafter. switching eligible by from Advantage every X% They beneficiaries as numerous every and, Medicare annually. marketing become switching from for Advantage

beneficiaries change. five in switch who nearly define shopping now their look covered they might split how needs beneficiaries new X,XXX costs It's on are and by between compare the supplemental option. traditional over plan needs costs given reviewing XX-XX There plans, and options that Medicare benefits at see their in and hard Advantage to plan switching highly beneficiary We the in as we plans covered made two spend. Those eligibility as to Medicare many over across shop whether more eligibility three their their to changes who plans. a available a drugs plans they the benefits XXXX. Medicare to are has now and We times to on prescription beneficiary times access year-over-year. their over benefits. if or believe of minimally happening as are one the are of changes to course Switching believe three annually. need the utilized Differences over Medicare. plan current shopped There clinicians a are optimal a and up and often. important context is nuanced between or to are consider improving XX Historically, shop low most relative to beneficiaries is two Plan average country, shopping services Advantage from beneficiary are to XX current

means moving from plan to one another. Switching

do individual best so believe any appropriate they them. to to we beneficiary’s the plan. more also should and of important at sure health, believe for policy they the it's needs that are critical plan need average, is We plan, overall help improvement stability as shopping they're annually We ensure in While in trusted are to believe reassess least a available make to needs on that believe beneficiaries unavoidable most be is we their a switching beneficiary dynamic shopping increases. resource

even to written the length LTVs the number on of gone policy As more, overall policies beneficiaries continue have shop increasing. down if of based a is

a an to focus in our us, consumer an enrolled advantage beneficiary on by of leveraging originally term. going shopping as we plan. beneficiaries. experience, with we More the unbiased, into options them If consumer to as long we build strategic with with multiple regardless beneficiaries are shop relationships prime will delivering shop, with their We, want however, are credibility and shop increase them to building turn for whether plan high-quality shopping us marketplace trusted relationship a agnostic we developing beneficiaries

be the to in results where with needs. destination the want year their mean an needs-based best beneficiary assessment might such plan if current every stays the We beneficiaries it's of plan provides for the assessment plan the their that

activate onboarding it we motivated support are to the process not able enroll ensure to benefits better best the Furthermore, the they we the in easy to one. change. make plan, is that it the If help

a focus in are unbiased may agents thorough enrollments that We this not plan also and sale. assessments the reinforcing by only year personalized new on result changes, not compensating experience a high-quality but customer on our and on

Our plans new standard operating static. inclusive model experience, that of beneficiary neither nor needs are and built is Encompass, concept customer the on

the highly to benefits every individual each Available them the skilled our agent right workforce best needs and plan. assess beneficiary's year change beneficiary. unique and health use of to as We financial uniform practices technology, priorities proprietary match to with each

the to of of needs, Our beneficiary model traditional that no whether them agents LTV piece that or we compensated key previously in cookie-cutter are comparisons. appropriate not. for is most there in a A their the the ensure are regardless in plan ratings enrolled policy is

the demographics same paper, basic to Two beneficiaries and may on next matches. prioritize other thus up living benefit different plan door each options different end with with

beneficiary preferences their different same in the calling two in changes years and option. have even thus plan recommended a may importantly, have health and More consecutive

demonstrated customers back brings model our have year-over-year. that We

data of shows plan in year. each enrolled the in to enhance that others are broadening we and/or like options industry. as served our to had XX% calls limiting experience nearly opposed previous we Our we the options in AEP compare the look from beneficiaries To forward beneficiaries for the plan we provide,

intend beneficiaries. where more tied enable to playing we is captive Encompass at solution GoHealth and quality winning to We the some as downline and channel transparent plans and new experience best benefits, the to our on health direct competitive for transitioning Encompass is internal and experience external where of with partners agents, begin even our a marketplace field the well. customer an standard compete

A and plan in be experience critical focus a This consistent what of where which a are, regardless a choose for the key area long-lasting trusted of what they to, us they is beneficiary needs they live, relationship. agents piece their speak for XXXX. uniform and of building will

strategic agents, our towards our in most shopping team services our operations, or us precious agency most a we highly dedicated implications streamline non-Encompass our decision made and Jason ensure change allows address decided enterprise valued and to experience. success, plan focus high-quality more assets, BPO on our will Medicare the health arrangements. detail. the This and exit to to remove this have have distractions of We our redirect business services. financial experienced move to To

win. the market win to while initiatives of consumers industry are will we People are ahead to who and understanding we on Looking offers GoHealth options, in more underway. are partner our strategic opposed positioned our who to best deep focusing benefit reducing chosen, We trusted and beyond, shop they options to new pays with. will the of XXXX And and as shop. be believe offer, positioning others the that quality to continue the we the reality because plan

in diverse beneficiaries expanding by proprietary technology the to developing complete by doing and choices future. adding We're our our solution, agents high-quality assessments build our and Encompass in so to continuing marketplace, for for more invest our

LTV on model are expand business our operating model diversifying our measured and away current a where same time, at the from LTV We basis. the our is diversifying beneficiaries; while approach to universe our policy marketing financials model, and of

share Finally, that to I'm are reinstating guidance. we pleased

strategic exit Our XXXX XXXX guidance incorporates rate from efficient our and on run builds our initiatives.

between million. in million $XX to cash from of EBITDA revenue be operations $XXX XXXX And million. million million. a positive million anticipate a We positive $XXX $XXX $XXX to expect expect and the we flow of $XXX range adjusted We and

to Jason? call financials. on over I'll to now turn Jason the more details the provide

of key the you thank for but and in proactive There are your takeaway drive took moving interest that to half story. continued last Vijay, the much business GoHealth better from materially is solution we and second a this you, parts the resulted and improved year the Encompass operations Thank all steps flow in directly increased economics. many quarter, create adoption a profile, our our cash which efficient model operating unit more in of

I a call, will is Investor deck, on Relations available today's referencing website. On be GoHealth the slide supporting which

Today, I will topics. be five discussing primary

and spend walking of to minutes the a BPO you lookback results. non-Encompass XXXX full year our I'll our to normalize Services couple First, exit discussing business. the QX includes our adjustments and decision through adjustments This to

more fiscal detail of quarter. in adjustment our explain will I each lookback Second,

to leveraging we economic illustrate versus internal deposition. to expansion traditional cash want in flow Encompass more our I closing, XXXX I'll Third, our the built flow half the solution profile LTV going versus cash business Medicare QX Encompass of second improved XXXX the QX of update solution give and our we in Fourth, model. the XXXX. of operating saw margin and efficient an I'm on by the model And performance on our in discuss

XX now Slides through Let Investor of providing with when year well XXXX jump-off the on are with in I our you you located as deck These are into point our and XXXX adjustments made right which adjustments outlook. Relations on and just the transparency of the illustrated provide QX me website. discussing full referenced, to the intent operating performance investor GoHealth walk the XX

and reported Slide QX lookback reduction a revenue in be which statements to XXXX financial million seen sold with EBITDA, $XXX our million in XXXX can related on adjusted and Included adjustment to XX. is to prior business $XXX reduction

to and smaller adjusted lookback $XXX this $XX our have negative EBITDA. been of impact have adjustment reduction quarter, Including million net of for the the lookback QX LTV revenue reduction QX adjusted our adjustments made would revenue in $XXX XXXX, the million, through and been EBITDA in XXXX would total a year is full million lookback $XXX million. adjustment Excluding

This is revenue illustrated on adjusted our been have year look our and full net $XXX would been EBITDA have excluding basis, would back to On a Slide million XX. adjustments, million. QX the $XX QX

exit we mentioned, the non-Encompass have our Vijay services As decision to BPO made strategic business.

Services the margin. BPO full In $X Services is on QX million million XXXX, XX and provides $XXX million non-Encompass of gross of represented margin, illustrated and Slide BPO revenue Slide year gross of which revenue $XX of XXXX million non-Encompass XX. $XX

of respective the on non-Encompass normalizing quarter our BPO for which in their been million, impact LTV depicted million, made have have comps of revenue on would is this and the last the XX. $XXX Excluding QX our back Slide look $XX Services, would and exit our XXXX been adjusted EBITDA graphs adjustment the

would exit revenue excluding of have EO illustrated XX. would million, QX $XXX year Slide non-Encompass XXXX lookback basis, have million, on adjusted for Services, our which been is full and the been BPO and through QX our On our the adjustments, a $XX normalizing

providing our is think these you is to adjustments year full should guidance XXXX with full what as 'XX important We transparency this you to. compare to our results

note. from traditional our One LTV were additional model. Historically, approved using submissions, item which policies carrier reflects of sold we

is solution As we continue under improved to the the of services not provide transition an accurate model. model, definition submissions solutions we to carrier Encompass the Encompass

exist, and will the both new informative solutions financials both see it's that define going LTV will in activity which we you our the the as model Given combined submissions, model traditional forward. believe more to Encompass

adjustments. some natural additional I adjustment. LTVs regarding our the were quarter related industry this potential want making address a to provide questions, to lookback some to Next, opposite I'd when preempt we like To lookback adjustment making why others with you in detail are and claims future

ever shopping serve for are XXXX Simply the believe adjustment sold and we making policies around especially the annual have the years in beneficiaries around we changed, put, dynamics beneficiary we market because: prior given this one, sold to observed more better us have informed patterns; volume conduct actuarial a the data of before, meaningful the and last analysis. several policies than two, now we over years, detailed and allowing

$XXX the lookback includes that million commission we also on note placed back-book Importantly, adjustment a our receivable. constraint

of adjustment back-book exposure the will our dynamics of anticipate Ultimately, actions further model the traditional on future reduce in taking is LTVs. are we the the a forward material pressure our away continued and risk. the our go LTV solutions It current size diversifies important the future revenue remember constraint our believe to from and amount risk, to model, we market works the future on reducing Encompass LTV

pursue sure by And of make finally, we are the that broadening marketing our ways and population switching behavior demographics benefit testing new oriented messages. less to book beneficiary experience

of do XX want Given the the economic traditional Please it compares on Slid quick solutions diversification view LTV the model. into the I earnings how to to refresher favorably and Encompass a of presentation. importance our model, our profile

differences model. between have illustrated Encompass unit this cash flow our LTV model and On solutions we slide year and our the economics annual traditional

related mix in our well high have a As as revenue driven to is plan traditional due you predictable estimates to the and variability by LTV This LTV less switching. product see, health we revenue. can as model, preferably

upon Encompass is as our the comparison, during predictable time is sales much life rendered model In it services solutions value process is of more which policy. a the predicting based

two evident point between one cash the models The difference year is flow. of around

one year policy $XXX that profile approximately of side policy see On you each XX, the negative in by of cash flow the is sold LTV traditional sold. can right Slide the for

cash solutions to under we $XXX drive a a choice, a better change trusted completed the cash each our basis. of profile the for goal resulting either in $XXX model, a representing experience year-long meaningfully model, beneficiary and comparison, under Ultimately, policy positive on one satisfaction, is high In have flow in relationship. per of year sale Encompass of

quality operational of model but the continued marketplace health Regardless plan for operating for and also it further serve, improved partners, model. more the drive only partners plan This in exact not health with intend payment will AEP. we this same to experience our have the for help our will beneficiaries have a efficient all we drive model upcoming

of demonstrate comparing to respective versus both economic the previously XXXX, operating of XXXX adjusting for leveraging Medicare the QX the impacts impacts QX Slide we the LTV for impurity adjustments lookback internal Encompass more the solution. performance efficient unit model, XXXX On and are discussed XXXX our impact XX, combined and XXXX. results QX their

see, As sales, realized high-quality you submission tenured can This of $XXX, XX% by our agents rates. effectuation driven is which more increase improved through our QX is sales was XXXX an performing per increase year-over-year.

had In addition, being efficient was second sales the built platform. XXXX more our more this the acquisition, achieved was a through model by nearly year-over-year conversion resulting cost of tenured and in Encompass with QX costs half we solutions improvement revenue our saw in The on significant improvement. rates through of agents. our platform, per in XX% more completed marketing predictable beneficiary This XX% impact favorable a driven that through

result, improvement Medicare $XXX a submission. or in where our saw gross QX compared which or per As we is business margins significant to gross per submission, achieved a XX% QX, $XXX internal margin XXXX, XX%

efficient operations. The having positive and Encompass on our model, produced flow penetration has more cash of result operating combination disciplined increased of expense a a our management, from solutions, meaningfully

$XXX On XXXX. we million positive million XXXX, compared XX, of operations you a the flow the improvement cash can from for Slide to which achieved full full $XX that year is see a year

materially from our strengthened focusing collective one are exceeding months management, and penetration a operating goal, managing we efficient agents future delivered. was retaining position tightly model have the best activities, expenses, high-quality result team the has our drive Encompass our the just of we thrilled highly improvement to of primary our on ago. with objectives and This By liquidity that enrollment

paid bringing payments, quarter, principal million $XXX of from and This strong XX. position on to million flow in Slide XXXX. plus down of down our liquidity, illustrated is you for Because our the XXXX $XXX QX increased in $XXX debt cash total million QX in we debt of fourth

It's untapped much to have also $XXX if our compliance of Due QX debt important we operational covenants to full note in an strong position, XXXX. results to and ever needed. same-day we improved access liquidity million revolver that for for liquidity our are

have the you covenants each quarters. our four last amend for recall, had might of we As to

the XX-month pleased achieving future. XXXX are lender further and partners a the of we debt our in have on ratio with amendments defined We our from achieve Based our enhanced agreements. for commercial operating with the successes that a Vijay for rate our don't includes anticipate need QX This Encompass our as solution in planned relationship covenant followed run more XXXX expect model, to and our ranges guidance from earlier. exit to able be performance, mentioned results efficient initiatives, XXXX we strategic leverage relationships,

strides predictability made the the profitable on financial growth, margin are XXXX meaningful foundation and and greater We of way in set business. flow cash through well-positioned our results our for to our profile improve and

the back closing turn Vijay provide now to to call I'll comments. Vijay?

Jason. you, Thank

quarter fourth in Jason about joined ahead. excited to results work We're some done. I and When we GoHealth exceeded expectations, significant had June Our the XXXX, be but still our specific there's journey goals. very

cash First, we to improve needed our characteristics of the model. flow

was efficiencies maximizing essential. Second,

to provided. to We and needed of the sales agents we Third, expect execute against financial experienced, achieved those prioritize over guidance volume to goals high-quality continue more agents.

Medicare the also evolves, Advantage GoHealth evolve. As industry will

contracts plan health We for the to choices proprietary to Encompass technology and evolving develop tools increase continuously with will deploy while partners continue beneficiaries to our and Platform. our establish

to are for we win. Thank and you afternoon. underway, attention positioned your this are your and initiatives for interest strategic Our

the your open now for will questions. We call

of Bank have question today Michael from Instructions] Cherny of first coming that The [Operator America. is we

of a Thanks a pieces. details lot of on for obviously lot moving

heavy this business is just will the quarter. rudimentary question, has and fourth First be to and maybe an modeling ties foremost overly that this always a but --

cash still any the doing. in this assume the course I with through of go seasonality being how on not XQ we we lion's year, flow maybe revenue obviously As there's see reporting EBITDA you're of will the in year some, terms basis? the change of what but share over comes a

for thanks I Vijay. joining. question. Michael, This is you the appreciate

question your to to be Let that revenue, It seen the me EBITDA, the is key to going what from seen related you've it like Or just seasonality repeat cash fairly the is trend previously. sounds changing question. we've consistent?

for And as seasonality where of what described is flows business, standpoint. you dynamics as When us. is business have the Encompass itself, from of always in said, to going of as volume the actually flow shift. a I you being you would some going think from we've QX basis, about would be seen the historically of cash focused the more a our of cash of predominantly the trough QX to That's profile kind a say

QX mill, flow from QX a seen. will historically be more run what QX be bit down QX so be you've would kind come little bit to of And neutral little and a a compared will of positive, more still basis. cash will you what the will expect

given see revenue expense with normal our lines general going and But flow flow those you'll with are to that volume, seasonality.

on Got like it. And had there. the just that it the looking changes was generate commissions of reduction in the when source biggest able asset on the balance you this at sheet, receivable seems cash I'm year to you're

Given to policy you structure ability you've they obviously back, here previously? desire and be relative cash you to how about came think the manage sold, versus quite targets where the the today, your given that flow your and are look different that were strong laid that achieve under way tie especially has the to previous you'll analyzing out which these do

I cash about Encompass, feel other higher first, we have significant I related did place. have flow it forward wrong just So correct? to a little here let a that because that me -- might repeat the going the come back you gotten the a I it has we're diversification in of sounded Michael, book we the from understand bit. flow like adjustment continued that there's to that cash made, asking, have back obviously, to have that how that initiatives of And all? Did to that we have. it you're given with all lot going confident we But question do question Obviously,

the best cash And is into from Encompass? Where sight of flow your your coming under yes. achieving line what's to this the build targets? Basically,

for Yes. clarification. the Thanks

of we at we have as see generate the in-period we One the model. captive confidence of about profile, versus the indicated, our definitely cash and of that how channel business you'll flow lot we element in Encompass cash think So share that. guidance what should flowing a as lion's look the and we Encompass platform, our internal through only with our that through of going provided external minority there, the traditional model a

given all we're economics that of of this a flow within range year. business million realized in of in in see flow cash seeing generating You the of within the year that that calendar But $XX back-book Encompass, that profile million to it's that the forms, cash well. unit seeing year, one flowing And written some process that included is you're $XXX cash year. and we're that the being as

year finding So value current confidence through the policies January we the profile assets the effective believe of year. and we flow in this this have that and given asset current are this projection high and from cash the already remainder

So think the cash is obviously, a but book in long more about as back asset the for about we when year, we the question, think fairly the profile we current this of you year. extend can term, that feel confident payment current

Yong Credit coming Instructions] from [Operator of Suisse. is question Our Jonathan next

noise background any there's if apologize here. I

into if of some go that thinking current interplay we Just that carriers, how a given preliminary rate the kind as Star changes notice the there's of of with churn, you of the the about are XXXX mean of cetera? MA in higher volatilities bigger et book assets the Ratings your for may and some AEP what and and some the

strategic Thanks actually you, a for the It's think that well And it provided earlier. I feeds into the I question. question. Thank great Jonathan. comments

we've definitely population the seeing and how a they competitive benefits attracted. are differently is in are lot net-net SNP cetera. is health products it that Different causing that different amongst the shopping there. reacting landscape, historically the that plans The non-SNP et of of to are out reimbursement that very in behaving We models, are

That different is interest options against believe the year their shop, as benefit change plan actually do really is every best needs to available. what of we are assess the dynamically in beneficiaries to personalized they that that

the think Encompass idea. that around we about it as so platform, And more is built

think of is we've health Now that should going look amongst the do those we that shifting at to likely Well, be contemplating competitive volatility of our looked what exposure plan back-book? LTVs modeling what there like is knowing positioning, the there's overall on take that this and part in will tenures place.

our estimates type So landscape, will not CMS. you specifically be behavior, over we or other the program design because multiple the changes or through understanding factored Stars that either that from oscillation, in are see of that of have just expectations still but things more it best competitive of years, XXXX that in of benefit strategy implicated that carriers reimbursement from

be in to as our of behavior here So as back the fact in anticipate presented the in the short, both shifting that prospective we well what in try best today. could our mix I there that some would numbers say, Jonathan, done is to book we've selling

of question RBC. Our will be next Instructions] [Operator Ben Hendrik from

us You term? been revenue mix kind question and that see Quick among just of XX% how Encompass from of us Can on to kind how is of the fee-based update has the the contracting -- model you give receptivity And on intermediate progressing coming remind over the channel. an progressing? contracting. just mentioned how carriers you to on

Ben. question, the for Thanks

What Encompass and As those that Tier adopted Encompass about X, quality that and found previous of and high our we to the AEP. results being through it the those QX carriers sale in indicated here, in traditional. of the to the late the calls, qualification, been that X as major quality had model, we who very compared our the the progress relates really comparing results, contract rolling all shopping last we year, talked experience, we've Tier model Tier the the process model, on beginning, verification we've experience were onboarding a describing of really then X full being

as We X. in the those became actually policies effective is, effectuation, which that January of uptick written saw an

that So we all saw lift.

from with external support help carriers program as of to so well. a exclude to us and -- And to lot test there's our other channels include products our definitely expand the been

optimistic very Every of are we're Others going. our So contracts year, on about longer They tenures have them. are year-to-year. how some that's multiyear.

forward. So as there's support we there's those this. always expanding a continue as we a there's the to continuous we it have in model for [non-abstinence], conversations, as about process and move continued But interest think

[Operator Instructions] William coming The next of question from Sam Hirsch Blair. is

Adam you hear Blair. from me? Klauber is This William Can

Yes.

in I'll for Yes. jump Sam.

than that you On data they've you have more obviously the in -- past. mentioned look-back, had the

model you One, two, were either the positive you two it. number you're smaller one? questions past, relatively were future, conservative nature, think in structure, will the on or negative, think in cash do then than to also shifting but on by And than more past? So the think they they've as the a be your number -- both do I using the look in been back but significantly just basis, assumptions

Thanks question, for the Adam.

data the and able data. the have get in were me experience that it quarter, question talk to you model that Let your we if about first more more you we model. I'd analyze were and more fourth update asked able as to more conservative. we And say was the

our I best conservatism. So trying it's We're that. about to think less always be

the trending we our based about extrapolate and at then estimates It's behavior that stratify to levels, the levels, can different that our actual that have in we into have on able more experience carrier revising triangles. really being the product

we as felt as were have could. we as that best though we with information looked we at so that, as accurately doing we the And

one anticipate so the -- be of adding as seen look fluidity is into and shopping top knowing see that, future more Jonathan that the we that could, to natural switching that might had. on constraint the people a of therefore the to a spoke we then at more there's with historically we going the where that's And prediction about a on try some estimate earlier things they forward, trends that starting it, are in that than marketplace and often just we

estimates. are that our dynamics are more it's as the changing, reflecting and think I So into that it serving we the we're market of

Encompass, towards that we'll Now what the moving as book. to have less as yes, true back more new that we have of you think volume into saying shift is future, is you're naturally,

volatility to the in couple And years happen of on cohorts. what tend more there's those tend to of average in find changes values as those the is you first

to you years fewer getting into as enrollment coming And volatility groups first new the in of model. the populations that so few those is out enrollment or diffused and have pool, populations

So accurate building there I have would enrollment on that in more it Encompass XXX% ever be directionally, and can't we're think towards don't absolutely legacy. as could move say future the some is the to that to Encompass, always less that on be we percentage the in we successful comment expect the I your will of because a we still go having volatility But pool basis, -- lot of years. if a current growing more

Okay.

thoughts of you. future just Thank use cash And then on flow. Okay.

a You obviously about paid this good down flow uses year? What chunk are cash thinking debt. you of of for

question. Great

and plan, investments some have including this things described a contemplated that our to that earlier been capital in that comments. platform expenditures we technology that in and you our lot to of marketplace into we've ensure model delivering our different We we've are are at looking

rates balance very have how see the and around optimize be thoughtful and to we a about we look debt the sheet interest the strategy how as at also naturally headwinds pressures and overall there that going are we We deploy best about can our be think different capital. to to able really think might

in not that both investments debt you sure our assumed on our guidance make most strategy. But making to the just agent us nice steps we some importantly, around we've to are initiatives experience. to for and into that be continue platform our standardizing the surprised forward should drive But the making consumer that

[Operator Instructions]

-- there sorry. have -- think we I

just I the I want to you know queue. queue. you back in I get we to Michael, miss said sure that. you in wanted I'm not seeing think, make didn't

Well, I appreciate time from questions. I think the today. everybody's that's it

the future are what very We of excited developing here. we're about

them. complicated a they is experience continue we can them team nuanced in uniform Our options a put to world very to fully and high-quality how available the help in engaged driving beneficiaries optimize that are for we as

future. So path down and again in our forward the you on from we to progress you updating look hearing look Thanks to all again. that forward

joining. all today's Thank conference for call. concludes This you

Everyone, evening. may have disconnect. great a You