Alignment Healthcare (ALHC) 2 Nov 232023 Q3 Earnings call transcript

Good day, and thank you for standing by. Welcome to Alignment Healthcare Third Quarter 2023 Earnings Conference Call. [Operator Instructions] After the speaker's presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded.I would now like to hand the conference over to John Kao, Founder and CEO. Please go ahead.

for on you earnings third thank call. conference and joining our us quarter Hello,

to results each deliver quarter pleased are We strong exceeded key indicators. outlook X as through our expectations our across of performance we third the

MBR gross our producing XXX,XXX For revenue XX.X%, million REACH XX% members, of year-over-year. ended growing of growth a health with Adjusted total the the approximately XX% of quarter MBR, approximately profit plan our $XXX.X million, excluding quarter XX.X%. We third was consolidated was XXXX, $XX.X represented membership while year-over-year. of ACO

million, Lastly, and success of includes strong our member-first stars. adjusted we founding EBITDA utilization was X demonstrate and across to performance delivering outlook negative are quarter our value $X.X low-cost third of model. against drivers; through growth, our ahead vision operating range.Our This that key executing our continues high-quality outcomes

results. our sign growth, retention improvements In a is terms intra-year yielding tangible momentum of membership sales and growth our that strong are

we midpoint Following membership about XXXX, quarter raising XX% reflect our results during also are and growth utilization growth we positioning our management our as our to our medical progress for call today, performance. outlook share XX.X% year-over-year. I'll model of clinical to guidance Further, revenue steady utilization, our reflect increasing growth our outperformance, in our while to year-end membership in AEP XXXX.Regarding feeling more continued reflect confident for quarter membership and third are MBR guidance the operations, improvements the

growth. despite absorbing per teams Our membership provider quarter in AVA thousand and the enabled delivered by new third admissions Anywhere Care engagement higher-than-anticipated XXX

to Stars. turning Lastly,

through plans and are the XXXX. of above provider with the achievement for a This X-Stars our delivered which of We between the to our our experience achievements of our upon Star's integrated are XX% best-in-class unites or seamless engagement.Expanding the technology our announce relationship purpose-built pleased health power team rated of external experience and testament platform, plan Each a member is member significant members quality to results. having demonstrate in providers. these internal further that MA

HMO consecutive our California contract achieved largest out X-Stars. X-Star Our marks in the at year least contract of which rating X has seventh

and particularly and rated the California, year operating result the X-Star markets advantage face our ] this as competing phased-in capitalize or higher our notable plans of will of X.X-Star XX% California on environment, funding XXXX, effects continue this payments approximately fell rated XX% of plans model. Carolina model.Amidst members relative markets. Outside now is North many and [ percentage risk strong will Our across our low-cost contracts. high-quality, our declining new to the have Stars Nevada In VXX to we in will from

by of As seamless in our experience continued ratings support we continue across AEP. grow our driving star are down new these our for improvements providers.Turning to regions doctors on we to states, in doubling create a to

membership year-over-year. are for and our XX% We expect AEP of X weeks or to first with above the X grow January pleased results at we

supported by products For strength and management curated once cost the portfolio capabilities. plan the we our enhanced year, our of again XXXX of stars

premiums all our of increased flat position or across allowances and or enabled us innovation quality competitors local many While richness commitment of and to lower and monthly are benefits, non-SNP to Alignment's benefit low-cost maximum with we dental product expanded across many our plans out-of-pocket our declining XXXX.Specifically, XX% fund flagship of costs members the to excited our plans. of have share that for are same

sample a of or regime. products health of Instacart third adjusted in forward about of be membership brands January.In as innovative care cover us update how more of our integrate over member fulsome someone as result pioneering the to target our the leads exemplify the selection in remainder Thomas optimistic outlook providing with XXXX our dedicated product XX% distinct hand guidance, Everywhere, approach an design We results just to our Seniors into to needs our curated and in year-to-date care collaborations well early solutions in on a growth the to the direct to with drive you also address more like need our next Thomas? our recent EBITDA year.Now, values to disciplined who XXXX whether and health-conscious it's Further, our is and I'll our of AEP growth. Walgreens conclusion, look savings confidence household progress to breakeven the for call financials We reinforces a the XXXX year. achieving landscape. leading This quarter

John. Thanks,

quarter XXX,XXX hold. member improvements as investments the made began guidance compared improvement experience of to ago. and and health infrastructure, XX% XXXX, increased were The our to sales membership outperformance plan members year-over-year and this by year retention sales approximately a take September on ending both our distribution For year against led earlier

was quarter combined in our sustained growth, low-XXX thousand PMPM where performance profit REACH.As third inpatient row membership quarter range. favorable grew reflecting XX.X%, grew $XX.X million, ACO an our in XX% the admissions REACH. MBR year-over-year. XX% quarter the with approximately the and representing or year-over-year XX%, gross Year-to-date Adjusted approximately ran John quarter marked drove million, mentioned, XX.X% results $XXX.X per to ACO revenue third Our our revenue growth revenue of approximately in a excluding in second excluding

clinical and the supported our engagement with programs strong strength was Continued in SG&A trends. quarter $XX.X was performance million. underlying member by utilization stable in our

points equity-based XXX basis decreased as XX% by year-over-year. third Excluding equity-based excluding approximately of year-over-year XXX $XX.X and quarter million, in SG&A year-to-date. points compensation was revenue of basis the expense, expense a percentage increase an compensation approximately SG&A

remain negative million to Taken and the $X.X adjusted quarter positioned was with EBITDA heading expectations and the investments. into million of cash $XXX.X together, solidly better the than We our our balance in sheet. short-term quarter.Moving ended

in of and approximately payment recognize will million. $XXX.X recorded deferred payment revenue as CMS it balance end the included from in premium Our at an the cash the early again quarter of We QX. QX revenue early as

the a reminder, payment, early on this not our million.Turning any approximately our investments, As $XXX metrics. short-term were impact does statement guidance. excluding Cash income have to and

For million. quarter, range plan to and $XX XXX,XXX gross and fourth we in range to adjusted EBITDA revenue to loss between of to be $XXX $XX in adjusted a to the $XXX health the million, be loss membership and and million million profit million be of members, XXX,XXX the of between $XX million $XX a be of expect

$XX to For expect be and million $X.XX the XXXX, in the range the million $XXX range billion, to raising between EBITDA loss we and we $XXX a be third XXXX of $X.X to are revenue full loss revenue guidance. million.On $XX in increasing back guidance and of to a million again profit of strong membership billion year adjusted our full-year and of once gross of our full-year be the quarter performance, adjusted

outperformance an prior reflects the roughly balanced respectively, of revenue reflect at for long-term XX% the MBR growth profit XX.X% members narrowed year-to-date guidance adjusted with Meanwhile, in fourth quarter. midpoint, higher consistent guidance by and MBR the XX.X% a new our guidance our to membership implies strong mix of and objective midpoint, from unchanged utilization, outlook.Our the reliably tailwinds and full from drive latest year range gross at XX% latest Our our annual growth. our

relative our start up as new initial at activities. members As has year-end to ramp guidance our outlook our we typically X,XXX the engagement increased a reminder, MBRs higher midpoint membership and at by clinical members

to $XX Additionally, of some revenue. now implies a and negative clinical year-to-date improvement X support SG&A of favorability negative XXX from includes resources EBITDA percentage SG&A we ramp-up objectives.Lastly, basis our in of year-over-year our million implied the in point our This towards anticipated January activities are a visit as of million incremental the outlook of $XX annual reinvesting range XXXX certain support adjusted wellness our growth. to

As and the growth strength in look is John our results that XX% translating let's during membership January.With weeks towards into call expect growth our we are you and Operator? up, or profitability January of deliver questions. the headway X mentioned, first we performance product that, updating on to to are of we our open targets at AEP making year-to-date year-over-year.To our demonstrate to and wrap positioning above results the X AEP continue long-term things the forward to we solid pleased

first show Thank Ransom comes you, from And I sir. of from John Raymond line James. question the the [Operator Instructions]

term, a traditional goals? I like got bit some Where do sit thinking you MA. to to know long longer-term you've margin Just long-term margin what more those little a kind goals need think now, get look and/or get you membership that to you revenue of

both consideration we new this new over level certain a membership function on taking is market way market given that or but additionally, time, of MBR of profitability, has. initiatives and not Thomas the a just revenue, that is here. drag the pace would think The SG&A John, just of our a expansion into about

outside we and not we likely share And driving into faster.I or means extending were geographies to kind looking so our I on will markets existing capturing add single reach time, or incremental over and gains care of maybe we some if for proposition county think new XXXX. instance, state goal model a think that only add focus growth XXXX I our that could existing to given value new of in the a of think likely of out opportunity our geographies market continue

membership a not certain sand going sure we're on to draw line so, I'm a And in or the revenue target.

the we pace how that's that about the sort think to of think over time. drivers as main I of

Thank next comes from question you. And show Fidel Stephens. from the Scott of I our line

on from maybe the other as in in the sort on how A you question markets? that you're what color and more can growth looking and the as of appreciate seeing to some I'd interested to the little observations in your you the MA in terms down is core visibility be a growth compared compared California individual call if the all to be just market into D-SNP traditional AEP. of And joining bit initial tonight. growth I Nice of then just break terms

provide Scott, happy color some to there.

means that first X So, the be heading in of generally AEP, looking in Outside to we're and see driver seeing likely across I shared as growth it's weeks our a John really markets ahead Based about early probably on what believe and in over of XXXX mentioned that our excited we're will populations pretty we see to needs to progress of and to some little ethnicities. overall that of income case driver acuity different we're counties be growth now. really our we're with our seeing largest say looking take California, results, for mix, much too try offering that products And And significant that tailored idea continue continue product of be across X solid year. a so. that you'll but spectrum, to the California our across section, what different the to net commentary, expectations for the have senior in next largest of far a setup.In into the out provide the to to weeks little is past want every a the for membership a type we obviously We across continue really meets too most will different opportunity consistent terms balanced approach his consumer. design the that into the products spectrum, product is XXXX. we so I'd

our we've so, level products. so XXXX. our about across enhanced that have your seen members To a products today our of are of types do And say and of we've growth pretty we far some of what I'd heading point, into XX% duly is different C-SNP eligible balanced

also the or that rebate healthier products I the other or products spectrum, nice younger think are end looking some that senior. a we've there. designed see tend of products more But growth at we'll attract cash-rich to on

So, balanced in really the to and drive traction we're future. mix nice of across seeing to the all we'll a continue growth board across try products

line question the next And Sachs. from Goldman Nathan Rich of you. our show Thank I comes from

as in XXXX. John, you and advantage provide relative you to maybe guess I bit particularly expecting And the what California wondered well, color maybe a more invested as business? the it XXXX relative you retention guess, if funding for to you're where in could relates I called on little I out,

improvement you helped. that some I saw think this year

So, be that you for in to next result just gains? what expectations then be growth year about have just seems year? just be we expectations And MBR of share as curious next the a how light should in should market your thinking that what some are follow-up,

combined with what to heading together, on to material the advantage, Nate, advantages about good But to I respect impacts think you. associated I'm the and notified VXX Stars. risk funding were Stars X hear think, from we changes, to the that relative us. just sector the into With everyone is with revenue on that that, PMPM XXXX. are talking be we obviously, something really the model in that's And the going

by And mean is pretty so getting what advantage is I the significant. Stars that

plans systems. And is we're X really higher. of I have in or those And essentially are think X of health integrated X health other that plans health the California interesting. vertically one third X-Stars

You we is work making the more resides with of our groups medical of a X-Star network our provider the rating, form of actually contracted but successful is provider that California.And got of XX% so It's and is that [ number whether their the IPAs, actually H providers. and all delivery that's or system advantage. competitive contracted a which engagement about in directly in way outside only And in significance California. membership the ]

we're I to ratings. VXX And said this think we a are -- in not at very just would profile conservative for of aggressive. headwinds we're reflected in start at to run compliant manifest competitive for all so get XXXX, the a last Those with off. have And the I of high do this thing reasons to itself.The bids to feel paying exhibited least we'll share And answer And so. to I And our is business significantly the lot kind Did EBITDA with discipline to only we've our drivers. that's advantage X? it's before, of X bid the Did starting I'd and help, have And all the protect that's the spot continue predicted advantage. some favor. next upcoming to X the that to I'm or upcoming get say in been breakeven relative would think Nate? very we so and is comfortable big I bids be RAF also, others miss And our why feeling of January.Does and very, lot to XXXX have of On very, on X, Star I I strategies, those say think to been 'XX to the financial confident I manifest margin more year. I And But margin are we in. And starting in XXXX. to we'll not are X the where going one expect on. VXX, underlying we the a through that We've we've continue number. be very itself it? weeks going going a that's and more

on the No, kind that's next that year. Any just follow-up early we helpful. Maybe a thoughts? MBR how about think of and just should

things. make No, to incremental going make I on think Yes. improvements think Yes, -- we're well, X we're going I retention. to

year with I vendors. some that abrasion we the earlier think signaled we in some had supplemental

in all think I all all to metrics show that and starting we've retention of of cleaned addressed It's that, just up. member satisfaction our metrics. already

improvement that continued there's AVA-centric, our lot degrees consistency, focus that we I a Care more are that. are the say levels both of stratification initiatives of engagement. more to undertaking would expect And us VXX. models, would stratification refined higher engagement consistent have of with of with I in associated Anywhere efforts MBR, mitigation continued on meaning So, then

apart IPAs And we we're to that We them. some with performance doctors own. of and it just working risk making -- with these degrees again, some this have So, even for talking We've the to I risk going IPAs got, next think, step doctors. all with work having through we've really is higher -- that us contract notion of also ourselves supporting work else MLR want offsets that and shared with from that whole of that everybody logical is don't and we're us closer we're mitigation operational already to adjustment get doctors work Like management. going workflows.So the the proven, we're the -- our to Stars of say setting to I of well. would more to that closer

a I XXXX. think for lot improved give those performance into things X MBR me even heading optimism of

the a we feel we're with very, overall, as would year. the very of members continue to going the I got of Now, XXXX focus that and to of that right been the say MBR well. on Obviously, have working part have we I members longer kind on just for members company in the good about newer now. operational But us every

line And question Partners. you. from Leerink of Thank Whit next comes show I from the our Mayo

now? hear Can you me

Yes.

your contracts. hear a season you happy had And you'd think may at underway or least one any want on I ensure just be were just I of new not numbers, on you have just of the And Stars. X-Star to was happy Star focus out? that looking like kind exciting retain I I kind problems. designation, caps And everybody. mean, tight you to an Headset you at whether with, specific I call of to mean, initiatives for question what guys the with on anything it

John. it's 'XX think Whit, across what we're everybody the tighter I methodology, the for Stars. was with Yes. new No, for again, X key happy board. announced methodology the And the just was

about And so happy I'm just very that.

the of we've some better terms engagement, about are of service in positioned date then operations I date management, And in some a and success thus IPA the with. that And something I earlier a continues a think their lot sit of a which you, on that provider seen I doctors measure on had in B, get working of support initiatives for feel obviously measures provider and we so XXXX. performance in in focused HEDIS I to job a think a the single I we and I and good underlying feel it's, of undertaking terms year we comfortable sure feel is the central just of very other making we with. and these challenges of tracking not of so and And on caps, Part the initiatives all with in that And we've I can with that service of denominators numerators IPAs, But good than I do on what taken I For the every XXXX, we're then to to we're improve.And in on the even did initiatives very administration, daily that tell lot basis and but got also basis. caps. far metrics daily gaps closed about basically ensure conversations. have

So, comfortable I I'm get see or the X-Stars to higher. mode we're it going very to be of and That's live. really kind in. pushing that we're more people

question, second of I update to or And mind. I tighter really on tie just market know kind have just brokers, guys comes a maybe with year strategy. an up this you number like don't to broker Texas know, of something tried

you're out Just feedback, are or making? better you plan do progress you're there. feeling feel seeing worse that How the that offerings other about

it a very I tailwinds that with and to and to Yes, respect the have of just advantages some of VXX. earlier, manifests tailwinds to all gets Stars in And It comparative a said itself tailwinds. products. kind strategy have we think result your we strong lot product of are benefit back that respect again, of I what with

as community. distribution, in If that very, kind going if not we we the can of really of not very by It's to And and general quality work place X-Star brokers. and respect a you're -- brokers, us. of measured strong the I just and kind with you broker results you broker that. operational from with CTMs to just have good.And enforcing we're very brokers the implementing -- you're getting have the the very of think X-Star been good sales It's you has have the compliance need products satisfaction, now control

very it's And operations that. level is a and So, just good. I done all organization job with and I'm -- very, it's our out control sales shout also a this of transfer, very at really happy visibility just of and of kind it would leadership very have and year. good sales teams

shows again, AEP. weeks And that of very about day, yes. momentum again, optimistic people that keep saying, that in is are So of the every and continuing that. asking couple I momentum first I'm I think And is

But So, happens. we'll see so so what far, good.

line show you. Jessica of Thank comes question the Tassan Sandler. next I And our Piper from from

to or mix innovation Can on membership just of just first wanted supplemental just the would for as I would member Alignment areas expect how debit result supplemental benefits. So, a benefit innovation? you kind ask of that know discuss of card expect you any we what shift you XXXX? was And the

a One of exceedingly we're with made. The benefit which excited No, looking it's plans teams very, of Instacart, ensure navigate bulked got and is call we the is And in lot. is announcements I co-branded grocery as experience one with we about that. would can And members John. our some deepen then us couple a relationships help that our with to Instacart The brokers very but is out markets kind a and up and That brand primary that innovative going through to Jess, select member pretty geographies, more Walgreens. resources we're introducing is of very them across our Walgreens. have innovative. We've love is we've it. some other name helping well.

and the love so hang the they app, people positive, are once of really And using the very get early the far, app it.And kind love indications it. of you navigating

social health, service promise health lifestyle of which this that convergence you're degree with convergence of kind them, provide design. benefits kind I'm something happy technology think of insurance that's with health So we just think super I and more between of with I MA senior see when of determinants to that health. of you of those combine of retail the kind or going that And insurance kind more traditional and with,

I convergence see think, that materialize. You to, can starting

there. I guess follow-up quick just one

to follow-up the community California. on just discounting any patterns just the into visibility center a benefit, then in retail Instacart store? or you Southern have purchasing do And would relative On a of better control be more kind over

-- there? the know is to plan a is that of is markets? types those across kind of And is that Or that what expand one-off? centers the intention interested Just

share first bit the little Instacart. that one, It's you metrics some AEP we through will a once get but Yes, we and -- get too early. on

has positive community. that's the feedback retail the to respect a center, think Laguna huge been good with I from met question. Woods a of With amount that

think And only us see would going I of centers clinical centers, to also mixed that the concierge you're call have more so, I it, these, necessarily be not would but use centers.

to that that. it's answered. I of degree bunch like mortar. bricks going of questions and of not have before can go everybody their kind to only annual we doing the all wellness these a it's model, bit so And the too -- branding clinical chronic you It's in and be bulk particularly the think, going And will. just But going positive if the side. home can we're little engagement, big of be engagement through of a other we're just actually to a most doing around get patient says an can models, most be not our having of Care a see in advantage. of hub-and-spoke of Anywhere presence a in not crazy, effective just efficient, the go of get it's goes sign accelerate still that and But a cases, visit. that have to, They the physical we're on kind they finding We're it way serving to Alignment finding you needs that also that that's the capital folks.But if and whole at going people

I do in think expensive. markets, I that. do us can think that's But expect select that. See very to you us

of question Thank line of Ron Bank from you. next America. And I the show from comes our Adam

like to up new just to follow-up the related I have then clarify I mentioned was that it that. higher wanted a on those it question what a MLR similar one before, guidance the quick you new implied is didn't to and And ask Just bit. basically update. about to that. to That's know pretty MLR but And members. go membership outperformance I want

I that's Yes, Thomas here. Yes. exactly right. think

out more a So for then year-to-date, invested that quarter million plan and which able members for some also you QX a few members added beyond. your into with dollars we is in typically the particularly, do really coming setting up which regarding higher the about members. our as favorable of bit XXXX annual the that third the we X wellness roughly we've of raise achieve know, utilization invest X,XXX midpoint, and loyal to guidance full our our been at To did we year activities, to a clinical engagement successful us or MBRs returning point, year also have our by heading than

of the that making second would lot it the a for a driver. So successful outperformance top that. funding that's part and I of up the in us But to of think investments on about essentially utilization, favorable as XXXX these set we're then incremental growth

similar that commentary? quarter, national period to you payers still point weren't that you up companies? had like the where else public are May claims you're payers utilization that's seeing MA guess all from have the and just what And time you to? And if following just really so the experience having from would what when on worried difference? and it, but seeing a -- now is last like anything April it and really more there would Or explain Is different from you're like problems really Or geography discussion other then that for geographic utilization. about and data from I -- that the

Yes.

seen in to have standpoint, outpatient quarter, experience. we our comments a an last from our to increase considerable So XXXX XXXX relative similar not

this in the low-single-digits, kind heading expectations year. So, realm of I think on are the outpatient again, into a PMPM year-over-year overall claims basis, within of our our up

to I think our that is, kind as of two-fold. why is theory

of other into return markets we're or perhaps in I 'XX, some saw XXXX.And extent, maybe saw certain I we all, first as part outpatient of in spend in run kind XXXX. heading that factors, others think rate our of in than based we of our earlier considerable a 'XX the that to think, I captured pretty was and relative increase on a to think so So

I benefit with provider our the model things helps the a hospital chronic think outpatient to that generate we us obviously our improve and to tailwind a as lot our that's opportunity the readmission tends and on complex unnecessary well. competitors. a things improve is I while additionally, those savings. that some be rates admissions, have Anywhere members we to of for who or avoidable of side efforts do It of driver relative But with material really many the clinical engagement less focus broader I there's think of Care of like nature. think where on

Thank our John James. from line Raymond you. Ransom show comes And the question I last from of

There's been think plans that chatter ]? harder are or industry strategy in either dropping of not Or light that? your MA this some and of How to is networks. changed go-to getting changed that's you some X trade do is network assemble over hospitals [

headwinds around take associated payers John. cap the been system I've are one. just anymore. and health of the not taking had with many with John, exit Stars of where VXX business, topic funding. there's the arrangements No, it's that CEOs, global and Yes. with I'll into they And different that cap scrutiny entered in a global this they're conversations that concerned funding the about health had public have lot you've systems

the right when now. you've go to got so one chain from there's supply cap, global essentially as -- this enough companies within I've And and X you're around insurance essentially taking said money you're get-go,

And why have and are lot is it.And other the systems health capacity space. right because all so so kind these systems -- now health access of lot you health the are the that of, A problem of a where running so we is a much problems, consider meaning that's out of demand getting the branded systems brand out strong. would There's of A-tier

a is to and are leverage turn, better interesting admissions, not what's AVA, is so want them they those us do. their funded. commercial not they and do want And admissions which where lower to in Care Anywhere Rather, frankly, just lot That's into hospitals solution of senior with what to admissions what cap. take replace are, approaching actually is global just their

a folks, as you commented long-term these of to going growth the for I to opportunity with of them. us the really trend that there.And kind So some start national be of and of I is working folks a is of think think that's one some larger they've the seeing viability challenging things the thematically,

of trend the see so geography board, continuing that And kind across would agnostic. I

that it's that question, theme seeing I know don't think a I'm if John. I everywhere. consistent answered your

not That's what was I That's expecting. interesting.

-- whole just is government makes driver? to going any ever that made in? the that us for Medicare program money tack of where think on is REACH, has one saves kind So, government to another Do of but just profit to the of attractive Or be one nobody stay money, programs one ACO material it the any these going enough be you more participating? to

think pretty of some if hard just to consistent and others. -- it's it's I've -- I kind kind We it's on-ramp with year. underwrite good like just they that of of Well, the like every to which when underwrite. not for capital seen is we kind also. raised value-based have benchmark It's I before. of it's But the that we've been an reset it's probably of physicians say kind care. want hard to bottom, mean why a it's it program deployed onboarding as don't at to the

part because do we as doctors. to our to think help it's So, want have important I portfolio it a of assisted

and it ACO the book. program lot kind with the good we of that have a of a And doctors so just MA want either DCE from relationships have view, or different And point of of to REACH of some program. don't than be component an MSSP a do workflow or we form

So, I'm sure would that we something care underwrite. us, But have not for we're provide and it's better them economics. helping better just

That we Thank question from Fidel one more question the you. in comes queue. showing have I'm from Scott Stephens.

into just I in California of And to a of contract sort 'XX? unit new negotiations the much care as for workers. with and for on actually wanted terms John of guess factoring of bill just around on sort dynamic approved that tip one we your upcoming that's more been recently, wage and where systems how was cost for guess, And this industry there. interested the the that two, agreed out Kaiser you're dynamics, the then the I California, really, bit as and in 'XX I'll to saw get And but of of 'XX, thinking your level view spear minimum sort Union thinking in tack health not to where started on has definitely more even

Scott, I think about there's kind we guess Thomas here. of might parts X that. to how

impact level the workforce, that nurses just is, its the direct terms doctors and given our of the first generally we state. negligible is of impact employ across the in So, clinical on

and something of as our not So, 'XX view outlook. of a we driver beyond major that kind

I think on of on our XXX% we a point in with typically Medicare how your that to typically, through of percentage terms with flow are eventually hospitals may Medicare. basis, it's contracting conversations hospitals, of

so leads And through of which we those is rate will it it contract also our to work are us greater for point, increases, hospitals to levels often that, getting revenue Medicare our way as but that in the to pressure, flows to general your through benchmark. see flows

contracting think of in approach those is of well time. our general, So, dynamics pretty some insulated over kind I from

our Thank call. all for concludes today's Thank you. That conference and session you Q&A attending.

may all time. disconnect You this at