HCA Healthcare (HCA) 24 Oct 232023 Q3 Earnings call transcript

Welcome to the HCA Healthcare Third Quarter 2023 Earnings Conference Call. Today's call is being recorded. At this time, for opening remarks and introductions, I would like to turn the call over to Vice President of Investor Relations, Mr. Frank Morgan. Please go ahead, sir.

to today's welcome and morning, everyone call. on Good our Hazen; and me this Bill Sam is morning With CFO, CEO, Ruffer. Sam primary and remarks, some and then Bill we'll take will provide questions.

remind call forward-looking results any that to cause those uncertainties are current from Sam, turn and call management's statements over that on differ expressed Numerous I should today's materially the let Before today. might actual me expectations. everyone based other that contain may to be risks, factors

Healthcare, call these call, factors in is and such release. and I'll listed make call call More in With SEC on table Sam. release adjusted information statements EBITDA EBITDA, a now being on and is measures will press today. are in the a measure, filings. reconciling replay providing today's HCA forward-looking is which reference This financial be today's adjusted Inc. net as of On morning's that, we and turn to supplemental income various non-GAAP our a recorded, later the to information available included this morning's will over attributable

right. company All the operating These solid you on morning. basis facility with call. healthy margins joining footprint a reflected various across results quarter strong a on volume same were broad-based growth in our continued and for services fundamentals our Good The business lines. same-facility for the and Thank the for service basis. demand

this our a our operational agenda. Valesco we by in Bill the including business, of momentum we were with most Across X moment. detail give our additional venture. results physician unfavorably Unfortunately, the labor maintain quarters, on will experienced that areas impact continued hospital-based progress our impacted over past

earnings quarters, top should quarter. implementing we less venture pressure have the the few efforts side in continuing lowered to our this are actions results losses. company for operational of for issue, Because reflect the the the over guidance that year its to our We next of of the effects primarily, and improve fourth including this these anticipate integrate additional

we strategically the decision of that and understand to was capacity believe important in consolidate maintaining is company. Valesco to the the It overall competitive offerings positioning imperative

the pathway will mitigate it As our to historically results. teams, the that a has find been case I with we forward had confident impact am has on our

For visits, an continued X.X% admissions X.X%. share the strong earnings Inpatient third quarter, per increased same-facility which $X.XX. favorable grew were by with impressive growth admissions diluted driven facility a Same payer and supported X%. were room equivalent was admissions Same-facility X.X%. emergency mix growing by acuity commercial grew volumes year-over-year. This

ER are results our encouraged revitalization it for is We our by the program patients. and producing

facility a as same X% surgeries on same of basis in categories outpatient contributed year-over-year. also procedures to which prior factors compared Other an grew, facility increase increased grew the to almost approximately including These X%. Outpatient outpatient X.X% year. cardiology revenue

the facilities. In additional the people the been of stable all our it hiring in quarter, was education was Nursing and significantly nurse year. Turnover quarter clinical strongest with College in we programs, orientation investments and invest Galen continued has to in

to compared as third and sequentially. XX.X% costs, XX% the labor contract last reduce helped results quarter positive These year

available in total of the the we admissions, with patients where which representing consistent bed During we maintained from only second other quarter, not capacity, rate hospitals X.X% could quarter. is accept instances the

resources offerings service will networks, the making accessibility. necessary our our to significant our improve our to and people care our in greater agenda we the provide us patients are with higher quality deliver with believe We and investments technology

ability to disciplined overall that all future. into Healthcare do approach, for maintain our financially. for every people operating what focused the clinically has great HCA dedication we deliver our benefits culture I they our proud execute day purpose. strategically a to which on their them want their This to I'm of thank stakeholders and and work. enhances will

me will shareholder Investor upcoming growth about when more Day let November on the with details We X value. we So and long-term our driving this. provide and sustained to forward company's look close approach to

also year I We quarter's as the to provide on longer-term details thinking With on targets. for the on early turn growth as upcoming will some Bill more well perspectives that, results. call the will

period. Great. from Thank revenue admissions for and $XX.XX comments X.X% some provide X.X% driven in growth $XX.XX morning, you, Consolidated our per in This in to admission. billion and everyone. net Sam, good I by prior equivalent billion X.X% performance quarter. the on increased additional will year increase revenue equivalent was the

Same-facility X.X%. grew revenues

Valesco company's see adjusted the results on claims his impact estimates our quarter quarter paid. second began million portion comments, in as the negative being of a As as A we a approximately was mentioned basis. $XXX Sam third year-to-date revising EBITDA revenue to to joint venture due of had the quarter the from in the on well

we This basis result a basis results had shortfalls on adjusted we negative quarter margins a on approximately was Valesco not of points The to expecting compared what originally basis. revenue XX modeled. in the XX we and EBITDA what are year-to-date are as operating points impact experiencing

Going venture forward, to quarter. we anticipate the million a approximate loss $XX from this

diligently cost payers appropriate adjustments reimbursement. more We are making to including multiple on and address reduce working program where with structure necessary, results, efforts the deploying efforts to for these working

have we subsidy we hospital-based contracted requests from providers. As discussed seen have increase previously,

contracted grown for basis. on XX% providers approximately year-to-date expense fee a Professional have

are payments to encouraged, rate we compared quarter quarter. Although slowed third the growth as second of in the these the of

these other mitigation above, resiliency strategies discussed issues. of to operational some to addition programs within In assess we adjustments impact help offset cost our to continue the the from

capital some cash to allocation metrics. Let me and flow speak

Our Capital stock paid and in billion $X.XX $XXX million We cash repurchased spending the about billion during of was of billion. from quarter. quarter. our $X.XX dividends $X.XX was the operations flow

near of to Xx. Our debt-to-adjusted the remains stated leverage EBITDA ratio of range X our end low

income range we noted to and $XX.X our updating guidance expect $XX.X $X.XX million HCA expect this net EBITDA attributable between between year billion Healthcare to billion to earnings diluted As $XX.X between $XX.XX and range $X.XX share to and we and range are adjusted follows: expect per release range between $XX.XX. billion, and we we revenues full in billion as XXXX our morning, to $XX.X billion,

We expect the for capital year. to approximately $X.X billion spending

I'd admissions our our we Before year-to-date on it our business year-to-date year up solid. have Year-to-date, prior have basis. believe facility Non-COVID core grown same for questions, grown X.X%. performance. We provide grown like to remain admissions admissions X.X% some open over a on metrics X.X%. commentary Equivalent have

are Inpatient have year. all into grown Same facility volume surgeries X.X%, the outpaced X.X% outpatient expectations up X.X%. a ER and year-to-date going on surgeries basis. visits metrics These grown original have our have

favorable. increasing X.X% and admissions on managed mix payer facility trends year-to-date basis. Same a X.X% Our remain admissions care increasing Medicare

admissions the year-to-date year from uninsured down slightly on and Medicaid are a prior basis.

Our on year and increased case revenues year-to-date slightly same-facility increased mix X.X% over index prior have basis. a our has held and

Our cost below On incredible year-to-date diligent done XX% contract teams pressures effort, million our are labor and addressing and expense prior down the last is labor operating contract as from supply same year a percentage an job prior focused basis, facility our a of have Through labor $XXX year. the year. a costs or of had revenue. we over

physician diligent focused a address We effort current the have help confidence pressures time. cost will and over similar that

We think XXXX, waiver which payment million. at our out-of-period $XXX impact current call for January, year-end support there the totaled from look discussed in COVID consider. adjusted we and XXX-B in items we to Texas all when are XXXX, our guidance payments, several approximately notable Lastly, EBITDA the

to you able recorded million rate first as growth consider take this And into we achieve. the the all in payer quarter with when $XXX year, been we've that the settlement pleased account, we of of we are

debt In has addition, our losses diluted sale and earnings X.X% per retirement grown year-to-date. facilities of on share, excluding of on losses

to this some So a quarter wanted I to moment take put perspective. in

call to up. So open forward with that, your questions, over Frank to to it we I'll turn look and the

[Operator may would Rianna, ask to those now Bill. a Instructions] question. you, you Thank instructions like to give who

[Operator America. Instructions] with comes question of first Fischbeck Kevin Bank from Our

build questions anything to the the Great. commentary of taken. Maybe lot whether there. strong I But about there's performance I last guess year. unusual, point The guess, year-to-date get I this about on a well performance that just is being I in want

volumes this good the mix we is continue. to or a to expecting I think whether think base are the really about out the there's -- payer to people growth future that in or trying be figure shouldn't or it's anything whether rate whether

growth So this base should think normal and about we good this? of I off a guess, is

this on of term though intermediate early And a any conditions. and an so or chronic there's will of remain have the Kevin, and term. lot way the given we demand that too think the It's we is into see strong the strong Sam. our as demand for future. well belief remains care health in market, the about concern baby in it's aging just trends forth, been boomers to population as for And near that even of impact the our that the GLP-X

a we're demand so we encouraged And by what standpoint, standpoint. from from really that see

share Our we believe, overall market be continues to we trends, our competitive positioning, vis-a-vis, within It's where were strong. pre-pandemic. indicated

encouraged so that. And we're by

We resources, our our believe, continue in necessary in objectives. with investing to positioning to company our agenda have appropriately to continue resources accomplish we the

economies standpoint, some trends the portfolio remain believe our across payer we've strong our of from we so seen. supports that And and mix that

have So we're reasonably optimistic durability. line top that overall you're metrics the seeing here that

UBS. comes Rice Our A.J. with question from next

And Obviously, down were would and went a thinking out QX. fee little sounds coming professional trying results, up catch-up -- sounds quarter, bit. from variance this was you the think $XX to as in Was relative It I understand there's million? focus second I'm it I step now on even if QX the it to you challenge. strong quarter, through it like, probably know anything, QX. the expectations. previous of obviously, it in the the stepped what some quarter in like

negative. in net $XX it's -- run better? quarter, Hopefully, the as to DPP could thought? just quarterly and a got adverse you're think next that just from Florida. is $XX way a into bigger about line more benefit payment assuming year, that QX continues. little if And sense. significantly thinking a And in comparison. about that that this you maybe you've what therefore, a to squeeze make then Or up Was the number in the So pick million was with rate right million And I

this Bill. A.J., Yes. is

Let those. to me try take

from was So I tell expected. kind on fee pro expense of first that to the that what in of There's on at Valesco the the And as quarter those. a Valesco quarter. from issue quarter. coming in see it's we and it's we fees. than we started second some we've clearing no I got our although the million as for best let's we revenue talk about rate did a I We're And is basis to a the operations, we being as growth year-to-date and mean, from anticipated. slowed continue I in run would about paid doubt Valesco. look growth subsidiary to isolate much think us not and in as mentioned, rate the have believe, third quarter our $XX quarter mentioned. said, revisions I you, a you Valesco requests, I professional we rate make claims to as for third see mitigate the probably of because efforts

talk next but give about of year later We And you're look right, as you have spoke efforts when underway it right. on, next that's this we our it I we'll sized year, run, short you more But sizing the that X about that have when a we'll well. you mitigate of number out. year. what to we're X quarters versus at this thinking in of But of it XX

the Florida? on Anything

we The Florida we other slightly we expected, above A.J., what programs, less but DPP expected. than were was that had

look element it necessarily discrete one that mix at of overall of in I company. the of focus context think revenue don't to the got on to And you just it. it's So the

was above. but So it -- slightly

Our next Hendrix RBC from question comes Capital with Markets. Ben

have million about $XXX from Valesco you to XQ DPP us Florida Excluding how of remaining If to year-over-year, appears EBITDA 'XX declined suggesting $XXX or that total margin would million that, so both short margin. basis characterize XXX the headwind. quarters, close brings by million $XXX the is of

to quarters requests call higher out and than other would regions there and the PPP or that anything other on margin? is other else But weigh there subsidy mentioned Florida. in maybe You

in last Bill. for that really about line The margin of when on we've this the was you you where points the was to basis that go the pro the margin Isolate operating due really Valesco, supplemental that is kind points. recorded the quarter. about adjust basis other Florida the growth and is balance increase as see lost XX And relative XX the Ben, some programs. to was the Yes, other DPP reported of expenses -- fee quarter we of

expenses points, XX strong other the about in the supplemental quarter. Valesco, trend. in the think increase off about XXX we I talked fee exclude XX recognized Labor was you way and was it, pro positive to is the if the effect operating So about basis when I that was just supply balance the was

Valesco those really much it's to as isolated So anything. X as supplemental issues, the payments

to that. Bill, think, point add I just a to

we're same expectations. facility spoke which include to, margins, line actually operating internal Our in elements Bill with did our those

I of our reflected little some again So performance pressure, a same from think facility. it the anticipated overall pressure, was but of of bit standpoint in the we

on So most the respect the the revenue earnings to this of with that challenge and plans Valesco associated the with venture.

Cowen. question from is next TD Our Taylor Gary with

and question clarification. one One

Just XX% XQ. see fees of the in OpEx Q, other but we'll this I the clarification, think professional were on I XX% the the in in XQ, think

look a I And bit a see give us comps we really accelerated in you're slowed guidance what into was about sounds at lot. nicely. was about weeks Just volume just mean of third admissions, carrying lot then a into that volume adjusted just 'XX. few you'll ER, at strength year-to-year question change maybe I it if my mean, hitting It 'XX and number stack the for didn't wondering Day. or we Investor thinking the strength. a wondering real the presumably, quarter. all little pretty that I'm admissions, how like

believe, Sam category performing our is here. well. again, every for business division growth can service admission admission were in in We growth, growth, in business this broad-based. volumes our had mean our had Every our offerings except Gary, business, and core Well, company hospital-centric adjusted I OV. had jump our Bill core is that

were behavioral might is productive. just and our we demand capacity felt mainly because down slightly. more we Our was down that behavior shrinking be adjustments, because capacity obstetrics Pediatric births not volume, was slightly, we down needed made because in but

really solid So lines, across service across geography and performance.

the think invested at labor as and our our bit quarter the well fourth by we in other into We push agenda done our that, were the to 'XX as of year actually the clinical throughout in And programs. graduate training front, heavily labor a same that making invested into help in headwind us agenda. little the labor created the our us. on a we year. and investing quarter the we new improvements. education. throughout On as have will Nursing with Galen for quarter College We've mean as We've time adjustments making facilities that in in I what That of

So these agenda all we're investing long-term in revenue to the spoke for our the that prospects of initiatives represent Bill yield.

payer revenue I think and pricing from positive. acuity, is the yield mix

So our I were line results in mentioned that expectation. our same-store with

adjustments we I on adjustments make important we we've here, we confident time is an have variance. I'm really Gary, pride in organization. and am we teams. in a problems. And our that the solutions thing over making can second complex that's to it confident as if ourselves who are think proven I that find And

necessary distressed anticipated. But very what It's not And but the business a somewhat again, so offerings community. requirements to struggling we that we consolidate in our was got and one. to we've important had the

as of work get be I we're the we as we the we So make proper gain a it, adjustments reimbursement understanding we from through and will providing. that it, now need able the to payers services for think better

remains to agenda as execute our in remains strong, and strong. our ability fortunately, balance our on to maintain so our invest And and positioning Bill alluded sheet to, our agenda

the see I portends we I'm push and company when some into the that So context pull the provide and what future. here, what the by for year as encouraged and up in quarter I for

to was as what of QX. Bill operating XX% other is under was QX, your it clarification. this in in percent Gary, just [indiscernible] a on similar And

with question Our comes Hynes Ann Mizuho. from next

any don't benefit any you year? the what sense to XXXX but UPL that I introducing next into Nevada know call now, want you know and provide be out on to is to guidance want incremental there have you headwinds event? Do heading degree, I the that that major tailwinds is program. will And before

is give than call still other is 'XX, quarter waiting mentioned the I when is we And Bill. settlement is. that thinking as full on too in recorded later the we'll one box, first that, this we We're Only commentary in of we'll what and the my Ann, our out, you payer And the it's we'll XXXX. our the approval for discuss you update early. estimate on on level. comments,

Our Mayo next with Whit from question Leerink comes Partners.

Valesco are that exactly Sam, the maybe plays into where expect just can on you elaborate go and And program, to any revitalization tangible and how progress you see the of in evolution that you in program ER XXXX? that? back

ago, was revitalization point. out for initiated I -- year resilient determined more the of exact months services room we couple the It X of ER our demand We program actually anticipated. remember that than was things. with be a a continues robust. maybe don't emergency So to ago coming One, pandemic had

felt needed business So had reenergize demand. we some leadership, the opportunity have with had operations in turnover associated we we our and we our to because

came a teams to for operations and rooms. sort of respect term, of emergency with about our went together basic our lack So revitalizing are better

We standards a and good processes for have and over patients. really we positive experience create time proven that a outcome our think

our of in to leaders, others these wanted leaders a we into our our some and the new through so these Valesco program standards number And really processes. of physician including are early results positive. And of retrain

the X Our patient from satisfaction is program. points up we when X began or

continues improve. throughput to Our

we're minutes with I patient clinician. within ER seeing XX or think a an X

were to door, As admitted, on those before. soon improved our has the able get as to discharging to throughput as we respect more as we're to them get our efficiently with times well present patients they than floors our

opportunities that to believe continue We strengthen to program. we have

our in as provider our investments other into perform an well play contractors making think leadership, in into And have. physician that include we're we reach will will at of that even as expanding hospital-based emergency rooms, that training. our hospital so continue we emergency which both the both well as Valesco And platform, well we're as to this our level. freestanding our room Again, higher

yielded growth, to encouraged of patient importantly, all it's volume that are yielded it's patient increases So by. we satisfaction yielded And say is that most improvement. throughput it's

achieve. continue hopefully We will to

Brian Our Jefferies. comes Tanquilut next from question with

done like it. an down maybe to what seems and going be Valesco. bolts nuts to But it needs of you Sam, idea of have in the

these that docs this revenue As we think of about sounds like employ issue. the it you now, is a fact more

that them done same-store the of maybe to Valesco admit. contract? HCA And needs if is tacking on Bill Or to per give revenue just for matter to So of can what just to contribution this, you a of us the be there? related kind

Let approaching was large-scale programs. we're I'm the physicians go. XXX like really I how again, had business we where we me how the it. across, it to that think -- at speak different A as make Again, decision forgot many, and we company term. long a to comfortable we're that, learning a felt I for were we decision, we point made right X,XXX

these us time, the underneath do service get We reasonably those to overhead approaches and appropriate confident there to. Ultimately, in And reimbursement today. need be There will the is more allocate could to We need maintain But get achieve contracts we like we some have We as as necessarily be we it's about staffing order hospitals immediately. emergency we to we the of And learn we need happening staffing we positioning. can the there be We that. But per we it. on will appropriate more that able are get how that's to get and to services challenge. feel that's again, the and se, And an not have you're right. think, programs be where but opportunities XX/X, opportunities. that paid deliver business. these to reimbursed future. for business, anesthesiologists. physicians. won't room we volume need XXX, appropriately. going think So through part adjusted emergency to Obviously, in are over complementary our are We this underneath this rooms change will

that rationale our decision-making. into so And

we're operations, we in period progress the rationalize to believe are going have and those of we that. now time, think And to the so on. areas I focus make reasonable a we'll that And on

about $XXX on Brian, revenue to Valesco year-to-date, a million revenue million numbers, just is year-to-date under $XXX basis. your

from Our next Wells with Baxter question comes Stephen Fargo.

commentary in slowing the fees on appreciate growth the the quarter. I all the professional and third

you a as this And do pretty think in checks challenging for here So you pressure is some the point. forward? going can it just something environment offset does you still particular, anesthesia norm those need manage it there think that remains to Is firms. out seem about we in a takes part that becoming the to flat for like something new and closer you'll as puts Or of around XXXX?

We what it's slow this going we've rate to do growth seen compared hard call. Well, of the to believe year. forward should

diligently As providers multiple efforts our I Valesco only well. said, not we're working but in as working with contracted on work

So we still growth. continue again, I We'll to think working slow do we'll and progress, managing slowing to is the impact through we've we're dealt with We us. as but But we'll its acute growth issues and subset that see you of that question a more the update our there. on and rate to there, out go diligently but some of on continue effect on. it, we're

with labor, I We're apply earlier still the that how responsibly to from agenda. here that and learn the those and that alluded an going get aggressively there to us through about and to make for. strides his the saw same makes this learnings we that believe commentary on at management answer sense worked managed have think forward company. our think we timely we've contract situation for that way I we And to And nurse reasonably to opportunities well. pressures we I would for in that Bill submit capacity shortages, are

confident, that work a the wherewithal reasonable through get have us these to And and we to so I as I'm solution. mindset and said, the

with question Deutsche next Chickering Pito comes from Our Bank.

period from But quarter. the sequential are normal the margin look quarter in Belesco, margin the higher than There at from lot fourth looks a normalize margin the million ramp of and prior if it for to this fourth implied $XX Florida quarter. the improvement and you DTP moving parts

you help the to of what that guidance us So margins XQ? implied to for for are sort can get bridge key drivers

Historically, the Florida quarter than this little the basis Valesco about and higher a because our margin XX our was DPP. quarter. Yes. quarter points normal talked best performance fourth is Obviously, impacted of I

margins same over XX%. were facility Our

think our reasonable we the guidance maybe fourth So quarter it's But is right the our immediate than expectation this we of on the based our of now. having pressures trend not that combination stronger a some had and the think outlook I quarter tends to average.

from Our Sternick next with question comes JPMorgan. Cal

go wanted to Just to a Valesco back second. for

expectation are the color obviously, is component lower mean, way $XX slightly the million on level give those at just loss give just it sounds just the is I'm to then what on a some cost the expect any would how Or $XX wondering here. throughout quarter next per that levers you magnitude So you to But think million And reimbursement year much probably reductions. with mitigation there bigger a offset run that if sense end the I cost purely of like per just this levers, side. could is you of and rate? year? for the could

think that the next that as past now to go revenue several and with issues the as mean, working a and diligently manage the just with a and so million quarter, we but but take -- a probably we'll our we shortfalls, I work we're that's $XX can but to approach through. into we're through. adjustments of the million to that. that. way be try earlier, the through said, we're revenue we and primarily continue revenue have we'll through. cost make, results revenue mitigate I update to I that And that. There quarters challenge And what mention we quarter, going increased issue our 'XX, to now, I Yes. cycle It's dealt confidence it's but And position, right $XX couple it's primarily view have to turn in working as all on progress through some We primary we've get may we'll the then around. a on

position I of revenue in a these So and some that much us think address better puts trends. to assess

the have to collections. billing we function contracting So coding revenue and from to cycle

think we at position to respond in to appropriate a then them. up come to with able so good and reasonably assess to be we're least those And trends actions

with Citigroup. question Our next Cassorla Jason comes from

impact you any not like seeing that expect so caught the it from we just helpful. sounds your guess with comments, underlying impacts, you're the inpatient potential any quarter. sure I wanted a is on little surgery on service other Sam, ask GLP-X, comp right. bit a about if demand the be making this then trends And quarter, on little I to lines. or there, difficult side. you but better don't But call much up was thoughts in X% to And there? out and anything have in trends would Great. line about bit the within

Yes.

GLP way start about make it's Let We judgment to too me issue. the generally. think effects early the on our with business any

as inpatient statin now we've fact done seen actually doing company from I the mean, into related outpatient. obviously, a We've company. to company. history would second make gone total to and an that the the orthopedic the with that the think of come example procedures other I we're mix, more as through of joints going ever very mix diversified in that I point drugs in cardiology we is cardiology a the have revenue we've GLP-X

aren't less small of those it X.X% company. in Obviously, to do a So lose really revenue. necessarily some patients really how patients I to the our going immediately overall know have program, we surgeries of implications bariatric judge have It's than who either. don't diabetes, but

believe, quarter We quarter actually around year. to was as where performance the less and had at the surgical business, too last than did days service again, and we very judgments, we Very had were headwind mix we that few procedure X with cardiology in respect in to surgical categories the down. calendar day broad-based a days make we So look early said had it's of way service line When that. earlier, I solid. you

as So that our face headwind strong performance the was of in well.

and was far forth. that's I of as what would growth inpatient service similar say the it as on the and so mix So outpatient volume

across So consistent, very our very geography. broad-based, again,

the we're output. so with pleased And pretty

Our Scott next Fidel from question comes with Stephens.

was relates state getting actions could passed as around wage some about trends in developments California. of of thinking some I we've environment union been of talk future that such the potential in the in wage seeing are the hoping and in laws at you indicators particularly recent these to some these the minimum it about as that maybe level,

see whether curious these be environment? a and wages? of on pro inflationary you you do won't trajectory on sort creating may in some think the there of wage bit over aggregate the sort more Just focused on affect Or of that pressure potentially overall

industry pressure a the put for California we going not up through some and on There out it The to was that elements Most company. a in normalized with year compensation have and the as care across X.X spot we laws have stabilization successful ago. very country X it has we business much is really has expectations compared our have forth. understands those de issues issues line And material issue a everybody that. of company, or hour years we're too we've in so beyond on pushing our was year, the in seen the that are which very programs with in that landed where of already cost an near wage in think health for with seeing has very had and Unionization impact labor organizationally across few been market the our minimum ways term. minimis compensation lined our to is as per the our but in in

pipeline And and number of to seeing we're have but of respect to programs so a go that's encouraging, we Obviously, College Nursing even new adjust and to we signs populating and sufficient to markets that workforce. change. students the educated the be our new very is respect those are. who are of to Galen who They're the where dynamic, want nurses turnover positive with into there's suggesting hiring with

to to agenda have issues and have place. our attention are that pay seeing. So as relates obviously but There overall the we're reasonably with macros encouraged people pretty by we're our we encouraged it and to, we are efforts the that we that we're in

comes Perse from Sachs. with question next Goldman Jamie Our

picture you bigger Just guys. a for question

range You've XX% parts lot you. moving talked for a longer-term about fairly now. A margins, of being to XX% right sustainable

right So to just level, can level there you just sustaining it high your rate business getting permanently you back going the a more is and in confidence that in and margin forward? take see anything at off of trajectory now that of that

mean, Bill. Yes. I is this

a in of think reasonably range. a we pretty track are that have margins I tight long record producing

Even as cycle bad pressures, with maybe contract now. debts before be or whether cost dealt labor it in costs we've periodic or physician and the previous

can at So operate continue have spoken I a we levels. to confidence past. in the team, We've strong company we the think as reasonably efficiency

a more and have of future. programs innovation around number the even operate in target We technology to initiatives to on that efficiently the continue resiliency opportunities

efficiency drive opportunity So I through continue think our to organization. expectation the and we've us got performance for to historical reasonable a is

Ransom with Raymond Our next John from James. question comes

If of you I I a in $XXX did $XXX million your XQ. over little million Valesco, take think

dropped in like revenue about your million. maybe could talking clarify the again, to on deep get you're your problem, ramp it know $XX guidance in in minus that of sequentially So seasonality that such by -- I but such know or that revenue kind you this and a XQ decline you I to forward, number XQ less cost XX. was why going means revenue revenue a outlook wrong. as And

to comments, some did to were contracts, is my adjudicated paid. In We we Bill, of this and started the being new quarter, in paid still revisions new. our claims I'm claims on not lot alluded second be have we quarter. third in putting received John a make estimates the to revenue

and year-to-date. the But third because it's that. the were to just So paid, somewhere either again, I on started That's at John, better the think but at to there. what of quarter, a just look a around forward, year-to-date understand we We on look we it's to kind able roughly million model may be really quarter, as will $XXX had revise we be think neighborhood that it's on I is history no that on of basis that. going fall side to claims there think best

kind EBITDA for $XX It -- our it's year about the of ties So $XXX year-to-date. that's same why forward. quarter, for the going into million it's million

is in million going cost embedded revenue, guide $XXX be just So business what's your it's forward, clear. million to $XXX

Yes.

very want consistent. you pretty broadly, think to be would If that

with comes Our Lake Justin from next question Wolfe Research.

I'm going to stuff. pile on physician this with

a So what know revenue I've I to this guys XX%. off on just are you far say, is new baseline, million this -- from, kind $XX business, be you obviously $XX very, never do. but at let's like million seen of good $XX a be business very a of

triple estimate on pretty not take, of My give to like think gave $XXX year-over-year is? the to you for did And that -- do do at for -- next are tailwinds say just you So headwinds, click and -- that's the million, close grow just then next was million? versus like versus me going another that or big on we what grow year? normally around not for Or you your on it's think you Are when that like you next growth. been therefore, that year? what ex the like right, about around with could run through only a $XXX headwind kind so pace payment, going physician million But somewhere And some drag anywhere you've subsidy they do makes sense. $XXX costs, And assuming just you you of seem the margins. that offset other can year, revenue that headwind numbers and the Or operating. the which we assuming costs it? is -- kind they've given you talked

we planning around of we're clearing And there. diligently was happen. are quickly. what Sam a lower offset that working very couple number see as let on that talk Well, make more expecting 'XX of we But One, telco go 'XX. All really I you some said, of Investor your forward. fee right, trends on about opening guidance Justin. the We'll as to On things. to detail through give lower we initiatives the programs, this rate providers emphasize said, think our question at on to Day to pro And just going in as assumptions claims XXX a operating of just And got that revenue being a again, very we we've data. we the incomplete X,XXX maybe integration some historical complex than to try were started that. I to anticipated. happen rates is to paid, and large growth

the and we're right continuing the fee expect so forward. growth do working to work address to then that we're we both And pro would on those. But I shortfall now. that's of Valesco so how And on rate going decline --

James next Our question comes Cantor with Sarah from Fitzgerald.

a better, the revision Valesco look when So the implying at core like change guys are revenue. you I the bit if midpoint. the It doing I use and in in moving looks pieces little guidance, especially is

give volumes can to you think update the so what an first for guidance seeing XQ far in So XXXX into us on the couple of what you're transition we how from implies about and should months volume XQ? XQ

Yes.

seeing comments pricing, of business we're So with are and know, operating quarter. comment company several volume, expenses doing the We've really labor in think, trends on the the supplies. don't current core we reasonable I on core strong the well as you made,

would for said those come most quarter We market. Good mentioned seen a we've you a that early, positioned again, with trends think the continue operations the broad with reasonably from is seeing. in and I integrations continue But going a macro pretty kind our I on well same intra-quarter facility pleased forward. we of comments, can perspective we're we'll that trends pace. generally and reasonable as well. anything the But Sam part, Unfortunately, expectation, be We're Valesco see going as at But his activities. expect it commenting our not we're core too the don't and our changing brush, demand we fundamentals that. are think very that. I early that in dealing core year-to-date should, or

Our Raskin Nephron with Research. next question comes from Joshua

this beat issue? Valesco just in know I to that And challenges revenue? on codes a again. that services? Was process Hate reduction horse. some started no submitted less in versus the curious going in getting arbitration causing Or the were just that I'm the payer Was lower that reduction then up been that Was that just the on revenues any to of at there? mitigate paid? that dead impact But there's reduction any claims what of as surprise rate was processed. just was there Is back mix? underway

Jeff. Yes,

hard shortfall So it's one the area. to attribute in any

on operating data other issues probably our array some historical incomplete of is providers were an are potential we maybe said, as experiencing. hospital model other and that I As

we're prefer address got to an a that process. initiatives try and see We we've that yes, to to about. so talked IDR avoid that we to of to And providers we've out surprise the in-network number of be continue -- the billing going can

network we're be so working and in our plan. going to with And action part to rates forward, of diligently payers our reasonable to be get going and that's

Brian with question next comes from Our Jefferies. Tanquilut

done. we're think I Rianna,

to the If you close queue? want

questions, Seeing to remarks. for closing call the Morgan turn will further back I no now over Frank

your you day. additional a this help I answer around today, I'm the questions for you afternoon, thanks so thank much great any might Rianna, if have. and on for Have call. to everyone joining can

Thank This you concludes call. for today's conference your participation.

disconnect. now may You

questions can might call, afternoon, this the around additional you any if I'm On answer I have.