DaVita (DVA) 29 Oct 242024 Q3 Earnings call transcript

Good evening. My name is Michelle, and I will be your conference facilitator today. [Operator Instructions]. At this time, we would like to welcome everyone to the DaVita Third Quarter 2024 Earnings Call. [Operator Instructions].

Mr. you, Thank begin may Eliason, your you conference.

meaning And and conference may forward-looking quarter you, Nic CEO; Group Investor and the our Rodriguez, our statements are our during third We appreciate Eliason, this Relations. federal of securities President note to Joel call. Vice me your our make the laws. of I'm today Javier Thank company. welcome joining CFO. Please continued that Ackerman, in interest we call, within

subject to that are statements. and unknown actual All to uncertainties statements of from forward-looking known risks and in could results these the the cause those differ materially described

report For further subsequent quarterly Form on our and to press with XX-K, Form details refer reports release subsequent other SEC. XX-Q make these annual concerning our we SEC uncertainties, our filings on please quarter the including that earnings and all third filings, and risks recent most

currently not to us, statements, law. are forward-looking to be required and on duty no available undertake by do information we update as and may Our based except statements these intend

we'd measures press the that and the call, over comparable some available financial our Rodriguez. will discuss now measures in included A during financial to these most to you measures. Additionally, we non-GAAP to reconciliation Javier will website. I turn GAAP this release of remind furnished our to is like non-GAAP call on SEC the

our efficiencies these thank across incredible and for challenges, Alongside also execute as always today. for as which line year. But the some our wrap joining clinical for the about and recent while provide all of call related Nic, care I will expectations up and first, you our innovate we operating third effort do deliver our discuss to continue with upcoming of we on supply navigating continuum the our quarter you, frontline care. a grateful patients Thank on our the outstanding expectations, for cover supply we XXXX will and highlight. rule CMS was start chain, in we call I'm final disruption. performance, an update hurricanes caregivers comments with with Today, next

use highlight to our have face storms. quarter, the of This remarkable patients opportunity recent and the in we'll resilience demonstrated teammates this

the month, devastation these the of caused impacted and Over being Hurricane fully these despite were communities. centers were operational providing and open lives relenting the Milton within the of millions of past path hundreds by days storms, care all Helene by in most in storm one but today, is of

and together checks support stories wellness gallons DaVita In affected. Many of patients and crews for water from inspirational came to dialysis to support need. these our fuel, conduct over tankers, water those generators, deployed storms, the country which immediate in aftermath teammates. across to emerged regions community, of high the missing teams from the the rallied and XX,XXX care search

worked survive. teammates dialysis transportation to leadership for for to to urgent the needed coordinate Local tirelessly and to many patients account all care patients access and

and those together come needing dialysis the Helene, others Asheville kidney the provide after patient care. to Our We nearby in Center for our under common open to the patients Hurricane of generated proud six in who treatment, immediately doors opened to was Kidney with see including anyone I providers. Sunday community treat community on support care facilities. from other power normally the care

underscored care discipline. local of with Combined resources again and the importance emergency teams, response the has our scaled dedication successful our of operating

other including since storms to passed, Although housing humanitarian coordinate and ongoing assistance. food, the are efforts have our needs,

our for one communities another patients. work you to with to We teammates the to the to above all and beyond continue rebuild. Thank who gone and impacted have care

PD PD provide uninterrupted. Baxter majority to treatment all were treatment. lines been solution supply and of of Cove and we us manufacturers our closing Helene able for facility. other majority used dialysis therapy for have hemodialysis Baxter to their to Baxter's saline sufficient North relatively of impact, key by continue in-center our the each current during supplies the PD or patients due community Hurricane supply used the with Beyond disrupted our home the peritoneal

new first as supply we While in and able we XX% have starts, us to we online. Baxter PD, the dynamics regulators, patient resume our efforts to to starts expect the had next back now levels supply PD their to great of on to to government to month, temporarily suspend Cove of officials their facility thanks bring work Baxter, with the new they and saline, normalize approximately is continue quarter. Shifting North expect pre-storm

of care been to alternative near financial we've QX patients. for end minimal. on impact occurred our the was securing these the successful results and supply quarter, Fortunately, of in ensure Because the safety challenges continuity

the of adjusted portion fourth XXXX PD costs, our range, a duration will supply within lower quarter, to challenges. and This the home this impact included estimate on For expect we an and of $XX depending million approximately quarterly into to productivity lower $XX we our from impact high the supply XXXX, continue the caregivers. income million guidance now due starts operating of is patient

to expectations rule the published for I'll ESRD be our will from shortly. final anticipate we now CMS, transition which

be on While primarily are many of rule, there two aspects focused the will we areas.

and the the CMS basket update, proposed handles rate. wage including base market the index First, new how

an to As led increase. rule reminder, the approximate proposed X.X% a

transition the Second oral-only is beginning into bundle January X. drugs of the

As Medicare statutory drug binders are from phosphate a by Medicare transition oral-only reminder, the which B. to mostly mandate over will a this benefit Part is drugs which

While for reimbursement such clear, intends items. treatment the bundle, made it drugs unbillable of on information initial to these waiting enter and the CMS we as are

with results adjusted this in patient consistent to straightforward, quarter was for we with of earnings believe We prepared advocate continue the and view quarter to income entire that to access value patients. Transitioning million $X.XX. first. as will important to transition therapies. this through legislators transition operating legislation share recognize but have to We're third this patients urge the fairly to delay pharmaceutical some rule bundle manufacturers of per more $XXX put how support provide these access the year. implement this We Adjusted long-standing to our our delivered continue implementation We to third our performance. was

Although our of as remains IKC repurchases. expansion, future. our treatment our flow disciplined capital strong, returning mitigate volume growth to momentum while share we with continue shareholders remains a allocation demonstrate we including the through deliver the invest challenge, to international margin capital to results, resilience strategy in business and headwinds our to volume on continues continuing all Cash and

already billion remain This forecast XXXX XXXX of our Turning the $X.XX We our on to track range. year. adjusted to We're ahead supply billion. the to deliver bit to although includes I year. guidance Baxter It many a you reconfirming shortage. looking XXXX, income guidance of now consistent for guidance is of $X.XX that early with full impact results to give are next operating specific know

open the on few more Over drugs cadence. key factors, care including integrated months, our with the will call, enrollment, in oral consistent fourth we we'll learn and kidney XXXX bundle, so formal quarter guidance normal others, the next provide

pressures. of growth multiyear said, deliver on despite may in That track continuing and helpful. the labor adjusted XXXX OI we're consecutive context second during some be to and year double-digit pandemic, After our years XXXX volume now challenging

financial Looking turn more pre-pandemic our will to forward, and guidance. I more consistent detail. expect historic to multiyear OI performance discuss with now outlook over Joel we adjusted in to our it growth return to

Javier. you, Thank

was and income cash was operating adjusted quarter, million. was $XXX flow free million. $XXX the Adjusted $X.XX EPS For

Beryl by weather per that details more me offset Hurricane X.X% second the $X treatment This fall volume continued namely our was Let admissions QX up per will in our results. slightly elevated mistreatment strong than in of with start treatment versus rates, Helene in with Hurricane expectations X%. Revenue the with July from day is Quarter-over-quarter inclement flat. in in September. We volume remain the and higher and full-year behind quarter, result line to some was resulting line growth our treatment range of was expectations. the and confident mortality

$XX continued Our $X care sustaining throughout the the our amortization and government quarterly and CKCC, plans medical expense needs recognition Kidney costs sequentially. by center of $XX expense pressure operational result strong costs. International as higher of $XX by for We Care, increased revenue and expect value-based increased This results performance plus Depreciation segment to to of in slightly Integrated Patient of exchange our closure in the operating seen timing. be Adjusted value-based a cost care to was of the million million the strong quarter in QX still the labor impact. growth costs typical X%. cycle primarily sequentially the cost result program. to related QX increased the within million per lower revenue million X.X% variability by RPT in year. versus range of to OI treatment unfavorable foreign $X increased increased due results quarter. the due G&A demonstration is timing care result benefits higher RPT performance special as within offset we've quarter-over-quarter

As loss operating evaluating variability. given of $XX performance always, for IKC basis year still annual we quarterly approximately on the full We recommend propensity have million. an will a IKC believe

of at quarter debt with interest Below weighted caps $XX is was our the XXXX. have rate our with our X.X% in two a the impact of million the OI for our This line than year. and current QX. in X% expense first, the expired from was of average consistent to This the and of beginning line, third rest rate factors: caps main higher end June approximately expectations guidance due

The additional was raised this in debt second August. the the contributing to factor quarter increase

we The XXXX. repay second to our now these transactions completed successfully $X.X maturity nearest totaling from Following Term Loan proceeds in quarter earnings making used our two B debt deals were hard debt our maturing billion. XXXX, call,

our Leverage shares In while was X.Xx the remaining have date slight third repurchased October. X.X XXX,XXX QX, at approximately EBITDA, quarter, and target the X.XXx we to below from the range QX EBITDA. repurchased increase of million midpoint in of a shares, of we end to Xx

look on clear out with and me as remains thoughts comments some we our XXXX towards of what XXXX. Let

billion. As OI adjusted impact in anticipated the OI the to Javier reaffirming range quarter, the momentum expect to operating said, offset billion we $X.XX $X.XX Despite continuing of guidance are headwind. we fourth hurricane-related our

We range of range our maintaining cash $XX.XX flow free million also $XXX $X.XX and of EPS to $X.X adjusted are to billion. our

Looking formal XXXX, early it to mentioned, forward guidance. too Javier give to is as

normal dynamics. of the headwinds call Regarding would outside like a of tailwinds out components our of unique I few potential some and to earnings,

in first, will elevated the we remain For expect headwinds, XXXX. mortality

Second, we closure of facility the will expect Baxter XXXX. continue impact in the

X% rate caps the negatively EPS. of impact of full-year expiration Third, interest impact the our will

center called For closure declining first XXXX the the we that tailwinds, quarter. costs last is in out

driven Second finally, to companies pharma the positive bundle are we is our America expect by international would passed legislation in business, the tailwind to orals Latin unable inclusion that OI if the from the the of our acquisitions. a impact And inclusion. be delay get

both to pre-COVID levels. elevated expect we Lastly, regarding growth, be relative RPT and PCC to

We will more the all give quantitative guidance earnings an factors, these on on QX along with update call.

concludes prepared please for for Operator, the remarks today. open That my call Q&A.

first Our Barclays. Mok Instructions] caller with [Operator is Andrew

It like be changes a amount most of help operational to felt was navigate there would the in QX. that fair hurricanes, of sounded but

on to had So if much of better I XQ how understand, hurricanes treatment an volumes, wanted impact one, any.

heard significant the acceleration in growth Joel, I then, year growth And from points basis XX imply impact XXX of I XQ you between against treatment greater reiterate fairly which to presumably would hurricanes. full think a

So how we that those think I just through comments? to understand want and should square

Yes. Thanks, Andrew.

and we this the QX don't about impact rate. from to QX, how XX about shows think were mistreatment hurricanes. hurricanes basis So up out does change I before in points, much call QX, for thinking as In I'd that

aren't sort an have QX QX hurricanes to volumes? the on impact So of expected

points Less far. significantly. XX The the over, is from than Less obviously. so seen what not we've basis quarter

XX far, could the points. so So But there it than challenges. no, basis be additional would be less

Got it.

the on financial comments potential have next hoping of XXXX of understand help can I then the that, on impact comment Can results. order you magnitude early appreciate of of And tailwinds. specifically inclusion those? of and Okay. the year's phosphate some binders you headwinds could on us that And the

it's not let start lot number. useful because you enough just unfortunately, you that, and because to on give we And to a really a useful Well, me with a we give tried binders there's quite on range. the the phosphate end information can't,

So you let explanation of give dynamics. me the just an underlying

So can on same page. be the everybody

binders So first that is phosphate of all, of bundle. in the the will the biggest part there of a be drugs, orals class

what rule out, shortly we be by hasn't because we The to the know although the do will government. hear is first thing expect come the reimbursement not

things don't there's we why that so products of participating in the restrictions thing is Part Secondly, and know have is don't within there of are about other be had and our products volume, this think and the what's XX% is going four the those XX% we And binders, branded D we mix to pricing phosphate happen Medicare once generic. away, last and bundle, authorizations patients the for quite between between and And the don't in oral access different the those and those know branded that that, within products. the to weren't then four with good And those for these mix. that have patients. go that's

don't we what that volume. so know And happen will with

And the start it quite pricing. that variable, wide start dynamics you with and is has volume up, the then really get mix one the lot to play if essence, could that a then a So because, they in the tighten within to into wide range. the the but throws reimbursement pricing of

a better better going we're to unfortunately, of to quarter wait you So until give that. number, sense next to have

on up of the part to follow And Yes. question. first your Andrew,

five tailwinds, EPS. that bundle, the but that a factors, two headwinds hard. it expense, each There could called apply impact factors is was the So the orals of to additional, would of only hits swing I that three these. one There's income. interest out in operating Like lot

So I a at said, for think offset That to and the quantify tailwinds that modeling the them headwinds will point be individually. starting other line. would I'm not each OI the going reasonable

it. Got

think which and pre-COVID, to that's X% growth, when about I is So reference think X% inclusive target headwind tailwinds. of we the

it? So that's should how think we about

I that's right. think think I -- that's yes,

next Rice is with A.J. UBS. Our caller

everybody. Thanks,

on $XX on strictly it Or EBITDA you're to elevated else just mistreatments, impact? $XX I the any know It sounds stronger? record. is pre-pandemic mortality. it clarification, the maybe wanted the The there new treatment was about like mortality now quarter, extending new out first of is answer that impact like I'll this get 'XX? -- just think commenting because making is It to revenue. on the broadly then anything the And Or is call on into to -- is to there levels. said of quarter. sure there? 'XX this the is you it that's I million that's on XXXX. not hurricane that assume Or then -- the Is you're then that to And you sounds more positive this mortality there heightened And million same? just just patterns rates? I last is that something was the again point that therapy but hurricane going time on I back make --

Yes.

So get let me order. in try and these

that's be So first, we revenue in in a for the chooses dialysis peritoneal terms in of the if But the for I not vast bit majority direction. Baxter go provider provide be some impact reason, to in revenue. whatever and able the EBITDA, a it that QX, line little patients it of largely say would potential to to another there's patient will would lose

just running same right? and the Mistreatment always it's not On X% during never storms, admits, and although the QX the is quarter-to-quarter, been average it's on new we've year, in and consistent about somewhere talked volume, with around three factors less the on past. QX so. elevated QX affecting rate QX nothing it's what Historically,

view XX the there's kind the here of then of miss negatively the probably bps but have think that bps it's what was don't XX impacts not our would I from more So rate. And anything we than the expected, mortality, on otherwise treatment new total storms XXXX.

the next this changed back we the I to anything quarter significantly. and mortality pre-COVID our But don't it fact informs our gone saw that bit. think views I a quarter year continues that every elevated happens, that levels, views over for that, having think

Deutsche with is caller next Bank. Pito Our Chickering

here. first and treatment patients transplant patients in other So the quarter. just you Can back how on non-acquired geographies. many new color on number color or the added centers Any quarter quantify lot you of second year. to of those you the focus obviously quarter, here, a moving this for number growth on Any lost third to

besides delayed reasons guys the tie any and growth the you're sort of incidence on you data for just USRDS at, looking quarterly that showing are looking I'm prevalence. I'm trying to other treatment mortalities' out with

Pito. you, Thank

there reality at look trying is elevated the It you all. restless straightforward the grab when the me let's it, mortality, needle to at high when a the of level happening and admit but it down growth, volume. mix, moved what's But sort is you that it's look Let it of, move you the at up healthy figure just energy the they as goes as is healthy. really just call are out When because with it it constant at doesn't that is little, transplant, and bit. at look a

has transplants continued be share of to Our constant.

of the things that a mortality. move little mistreatments because storms but seasonal, could at or have we the here end So of is and the it the elevated there are day, bulk other

the the just me to pop volatility quarterly on bit just about a Let NAG the quarter. that. question me it. the in let was has first some on in -- NAG give little And you

you're to don't to census out that figure If number all of is great is quarter. for do, I think during including to trying treatment a trends, trying trying this what out. timing that. looking the number is about we're rate, think which the to do you're piece trying a which lot quarter-over-quarter at Within I factors, volume NAG

material So XX the I it's overall about quarter-over-quarter. where down don't trending. bps that is anything volume think says

Okay. Fair enough.

here Sort volatility of, the a with IKC, quarter. of on during usually, quarter. we'll up had this you a say, your payers lot lately third have true follow-up Payers

third true-up XXXX that the curious for Just went quarter. how payers during with the

Yes.

rather IKC at the on I And say say our encourage always basis. for the has in everyone are not and we basis read would I have, we you I a quarterly long. for we're year, about the would which we on track an payer volatility reaffirming would look has been us. the -- than our number So all market year. largely that $XX annual year let's impacted million as negative

don't previous then guys quarter. that you year do the... Is But Okay. from annual the your during the true-ups big third

as We fourth the quarter them and going and planned. third in they're the do quarter,

Okay.

enough. Fair Okay.

then sort levels. for of increases in with And just Okay. here, tracking MA at last line these looking price 'XX, historical are question and commercial

to Yes, call there's interesting nothing out.

Going as expected.

is Bernstein. caller Clive with next Lisa Our

XXXX? and us given to should is growth of Just year? on the savings. how terms your shared between at you previously, in any volume thoughts about also any continued into in for volume helpful. IKC, decline, were be can X% give the indication we I capitated how think growth, you think split That X.X% And would reimbursement

Starting Yes. there. of XXXX, for volume so we're on the bps bps thinking growth, still to XX change no XXX

I thing, get one. to I IKC think a have the Lisa? back On we'll on to miss question, that you Did

would No, I no. mean line point through revenue, to just the I -- be growth it I think you on on just was both indication how in of think the helpful back trying some to get there. for yes, wait at of I'll top that. economics But potential the just IKC, to get some and work

call Our Instructions] America. of Bank of Gajuk [Operator is next Joanna

up year of I should of the last year? I'll how target next for X% here And about, growing the you just on and slightly still your I guess same-store? question kind guess, So volumes we ultimate expect follow grow think right? to around volumes, So then

Yes.

would next year a points put So most on the range XX more and mortality next that. of model and treatment basis headwind middle mentioned, take as to for growth, of of year, mortality year, would story if closures. about And say, you to year, pretty Javier clinic this happens little the points. associated of for are issue year then then the basis with year think that's on of what that. to have as is background headwind I of for one now. to with that our pretty associated year. think tailwind. The on it's the if -- patients headwind clinic last one you that PD how start there's to further have the headwind headwind tailwind there's as source next all We the XX want we over closures new slight be next quarter, days of called a simple. those a they quarter the out to about offsetting. and next about could for call the for There Baxter the clinic bit might we'll don't of as who some might our another a go want volume we're and the to also having PD PD And I two Baxter provider. I patients and history, And come PD see little into We would a closures then things, the ability and start potentially color

have mix. with starting basis a next So year, XX points year's base day you points, of really basis less of this XX

back out base to year next. Javier think to of source X to what so obviously, next year. start and then this to then they getting also basis XX another a up said, versus And mistreatment points mortality you with what be And from to rate will figure happen it's can year the everyone variability of

the out would framework I think lay that's for So about it. to how

question, Okay. on helpful. go just there, PD follow-up I patients. a have I before I That's another if very may, the But but

what's mix then guess inside what's versus I and dialysis the HD So Home. that, home your PD

a happened mid-XXs HHD X% mix So like it range. in that's because or And is hasn't in our the mix. is the so the end of the by quarter. PD changed moment the to literally government, sure make been get they've take to that of would around I this And our and just amazing thank the supply. all their Baxter patients clock working

see little deterioration what that And told us, we we the they've on our quarter, by at to first obviously patients track. fourth and a try get so normalize back quarter through as will all but will we the in look

in them to of The of dialysis, patients, could majority bit it don't including in clinics. half and for there patients, function, think on inconvenience and before assuming dialyzing residual expect Yes. And much And then to little PD keep And renal them then too about dialysis the of those them. are go new another Those to be PD. new options, Joanna, one provider. go going are of that already who center them, postponing to we the many we I'd they will go want thing could PD. add, won't to is to wait some they an PD remember, to our have to vast move decide be they who transition they have patients wait, a

a see So leave to decline but in a we over next patients or our significant decline, home is think what that we the mix don't we'll would don't DaVita, that DaVita potentially be expect you of the high. quarter actually join number

is another That's guess super are I the RPT do still you kind a think this of number expect X% I helpful. bit up little it? you Okay. you're next for year, for following to implying the Or If to question about that may, had think So on elevated? on less, growth more? is next I a little next to bit year year's X.X% outlook. comment year? around How to guiding be your it

to It's lower that. would quantitatively, too early than guide think but I

Okay.

higher saying than but like your you're X%, historical range? it's X.X% lower lot to than So

Yes.

Javier. is This

was Just to HHD should and clear clear. mix I PD. or I clarify, that, I home total, it which don't of of patients and said that think comment have our that was XX% the don't X% I because think is are change XX.X% been.

PD. is XX%

with Our is Cowen. caller TD Langston next Ryan

year-over-year. those the had second sense a increased. said release, think you it kind of to? quarter, that Can advocacy us think In I the costs related just were down I on give what those XQ in are But

one orals because D.C. that costs, then, the of we're Washington, be elections and campaigns advocacy what you and heard of from pharmaceutical are would in the bundle. the to And the companies main in a the are patients orals through the there of course, on might couple with there going trying bundle the doing things in the several last are but delay have the some drivers restore got California We've

so the And resources in we're mobilize educated having D.C. bundle make in to that people good to are the is to can orals sure our Washington, do.

last then from And me. it. just Got

missed I second in row from think a elevated on weather. just treatments quarter

would those have I revert that levels. events, to historical hurricanes, sort cetera, of et Assuming more, other we don't to guess, expect normalized weather we any

So, pre-COVID still rate still is There's elevated mistreatment running to relative -- levels.

additional without them down So said, storms, pace seasonally be in the I think that of they determined. expect time, continue up remember, That tick over to to go to QX. do would is we

-- miss up without with be additional treatment to even storms, you'd QX. rate expect in So

Our next Wolfe caller is Research. with Justin Lake

of didn't First going I to mention your annualizing headwinds next strength annualizing back year. question, XXXX hear you RPT the just and tailwinds.

Just X.X% X%, So going X.X% in that of of to the have year. X%. from I you you've right? up my second X% numbers, to guided half lot ramps to by A the

the So XXXX. on to I half missing would thought a be growth Any Am of that strong pretty tailwind would 'XX that? good have comment second I annualization something?

Yes.

call math your and a Justin, had as to about lot is by tailwinds. imagine, We out non-unique our as and can comments. unique all what stand we debates, right, of versus you headwinds and tailwinds headwinds

going not next to is stand just higher why called RPT normal year. to chose tailwinds we be it the in we bucket that's by put and than out we headwinds that, So out. I called and think of We

a the of Or $XXX take million interest I'll this offline. that migrate into does potentially it good Then Okay. run is XXXX? rate? higher expense,

No.

rate. run a it's think good I

for caps Our this for actually than lower our year. year next slightly caps are

work, for to next uptick million could clear, year. So be is that $XXX the just the

I think as you So to at should for this and in is on -- My $XXX you back year. looking think about one come second. second, a me let million the Justin. me team Hold

wasn't Sure. about talking To talking be just clear, about... the year-over-year. Sure. was I I

reasonably number. is the for that Sorry. the a quarter, $XXX sorry, million I'm good

to driving quarters over are as expect wouldn't because number up, that incur could a and if come us going caps aren't our down year, things few then bit two next I number our materially. it's the lower. the it next more quarterly a to But caps you change debt, little For think are the more which debt of

like now. right reasonable Or they If a to those the of be fine. kind end Okay. at and expired re-up year them rate, Do caps seems at you are of expire? could rate they interest next

Yes.

So do we it. way we changed the

or X- QX the cap. cliff, cliff We a X-year used a had we we end at of a do because have to

Now we do it rolling.

this. caps you a and So in big when interest move rates down will place. are gradually where like see up the going change on depending forward, put wouldn't It are

then commercial I give but missed mix the you last I this, XX% lastly, versus, talked I And about Perfect. you market? did number think, apologize just a the if quarter quarter, for

Yes. for in our any changes the There material usual numbers. was really mix mix nothing of

Barclays. with Mok Andrew

ahead, You may sir. go

It I year-over-year. drivers looks What just to G&A. XX% that sequentially in X% quarter? and up were was follow of that wanted the up on the like

on care is, because G&A, we have we're into part to continuum bulk And the the But going of the going. it care. got investment in revenue Yes. part wages united entire render operations of treatment. a you've IT going there. And all would the the third lot be the In per through is of the trying in course, big transitions that of is go increase really second reimbursement

So those explain the the increase. vast majority of

Got it.

follow-up on ACA within you that this maybe commercial then on exchanges And is commercial exchange seeing mix ACA year? are Okay. the the growth the to much How mix. mix the the much And within how XX%?

got So the just language, I've right make on to QHPs. the sure think I

around mix. X% So the country And QHPs, on to running the is is around mix. our X% X% population running

of because our out And in one of so Medicare are they QHPs, QHP. patients we're the underrepresented if pick

So that's underrepresented. why we're

of it. class? how payer And a seen that you've sense you can give growth us Got much in

We're growing exactly grows. as the market

other. been lines the on that literally are top of has So each

with Deutsche Bank. Chickering Pito

sir. ahead, go may You

tailwind Will quick here A next be year? depreciation for XXXX. for another follow-up

Pito, that. hear you didn't that I can sorry, again? say I'm

for you year EPS? another depreciation tailwind bet. next Will Yes, be

from flat is Well, It center to Part be excluding down. it answer comes to will down. closure that, flat be yes. coming it the But down. number the will of

Okay.

hurts, PD doing get, facilities on to of mortality, but quick up of back lack just So some ramping the back envelope rapidly. math, their pretty that sort I

thinking be and this? of Is this up. But see a depending bundle. upon the more this headwind. just about we that where way a fair ends tailwinds a bundle possibility the Is quarter. to headwinds think the on So cap, where just math, bundle first the that's that's part just To goes, again you upon center put first in when all much pretty the of the the together Depending international, question Justin's interest and to that's will want of tailwind math. closures

with are or asking I'm me help headwind the of it's if just -- Pito, the specifically you tailwind, end what the a bundle? again question,

Yes.

seem the the those bundle. tailwinds is the biggest and be seems understand variable together the putting on So just understand math of to math the the headwinds, tailwind, -- with the here

[indiscernible] Got it.

Okay.

about goes, upon depending your soon. it? whether do. of could that push tailwinds says and a This the a depending tailwind more pricing maybe favorable we thinking are could will the way Is where head government get versus upon guess, that I a what so we the fair define bundle about upon of the And be, depending commentary

giving probably more little I think these of to. a bit a lines than variability credit in you're bunch there's

them. could orals So of probably in amount decent worse, could a play these have be better, it be all of but

So way I go net could headwind a either it tailwind. think net a or

showing no this At time, over the am further turn closing I you. questions. for Thank I'll to you comments. call back

DaVita our the Okay. work hard care Thank with you, for will Michelle, I interest DaVita. your patients. for of in end behalf our you we call of on appreciation all and the where teams started thank

said, be and while returned income we elevated, our your some strong the capabilities investments business. We've our operating covered Although will our of costs continued you performance has absorb recent incur as pre-pandemic And these expenses trajectory. and related Thank we continued we underlying a lot expect for to interest within volume. to on storms, to the infrastructure well. in people mortality remains additional and

today's you. Thank concludes conference This call.

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