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spk00: Hi, everyone, and welcome to today's Astrana Health first quarter 2024 earnings call. At this time, all participants are in a listen-only mode. Later, you will have the opportunity to ask questions during the question and answer session, and instructions will be provided at that time. Today's speakers will be Brandon Sim, President and Chief Executive Officer of Astrana Health, and Chan Basho, Chief Operating and Financial Officer. The press release announcing Astrona Health Inc.' 's results for the first quarter ended March 31, 2024, is available at the investor section of the company's website at www.astronahealth.com. The company will discuss certain non-GAAP measures during this call. Reconciliations to the most comparable GAAP measure are included in the press release. To provide some additional background on its results, the company has made a supplemental deck available on its website. A replay of this broadcast will also be made available at Astrana Health's website after the conclusion of this call. Before we get started, I would like to remind everyone that this conference call and any accompanying information discussed herein contains certain forward-looking statements within the meaning of the safe harbor provision of the Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terms such as anticipate, believe, expect, future, plan, outlook, and will, and include, among other things, statements regarding the company's guidance for the year ending December 31, 2024, continued growth acquisition strategy, ability to deliver sustainable long-term value, ability to respond to the changing environment, operational focus, strategic growth plans, and merger integration efforts. Although the company believes that the expectations reflected in its forward-looking statements are reasonable as of today, those statements are subject to risks and uncertainties that could cause the actual results to differ dramatically from those projected. There can be no assurance that those expectations will prove to be correct. Information about the risks associated with investing in Estrana Health is included in its filings with the Securities and Exchange Commission, which we encourage you to review before making an investment decision. The company does not assume any obligation to update any forward-looking statements as a result of new information, future events, changes in market conditions or otherwise, except as required by law. Regarding the disclaimer language, I would also like to refer you to slide two of the conference call presentation for further information. With that, I'll turn the call over to Astrana Health President and Chief Executive Officer, Brandon Sim. Please go ahead, Brandon.
spk05: Thank you, Operator. Good evening, and thank you all for joining us today. We began 2024 with a strong first quarter here at Astrana Health as we expand our innovative care model and technology platforms. to empower entrepreneurial providers and improve healthcare in local communities throughout the country. We continue to deliver against our strategic roadmap and are proud to announce compelling financial, operational, and clinical results to start the year. I'll start by highlighting our financial performance for the first quarter of 2024. Total revenue at Estrana reached $404 million, a 20% increase compared to the prior year period. and adjusted EBITDA rose to $42.2 million, up 42% compared to the prior year period. This resulted in an adjusted EBITDA margin of 10.4%. Both growth and profitability metrics were driven by robust membership growth across all our lines of business, coupled with ongoing success in managing the total cost of care for these members and value-based risk-bearing arrangements. We also continued investing in our teams, our technology platforms, and our new market entry operations. We believe these investments are critical towards our ongoing commitment to building a sustainable business even as we continue to expand rapidly. As a reminder, we have consistently talked about the four pillars of our business which we feel our platform is uniquely positioned to execute on. One, expanding our membership base across existing and new geographies. increasing the level of accountability and risk we are responsible for in our value-based care contracts, three, empowering our providers to achieve superior patient outcomes, and four, executing strategic acquisitions to further accelerate our growth trajectory. On the first pillar, we experienced robust growth and membership in both core and new regions. We now manage approximately 1 million lives driven by robust organic growth and strategic acquisitions. Our membership grew organically by around 10% year-to-date, a number that is net of Medicaid redetermination and does not include any strategic acquisitions. On the second pillar, we continue to take on greater responsibility for the total cost of care of our members, as we promised we would do. As of April 1st, our full risk business makes up approximately 60% of total capitation revenue, and we anticipate continuing to grow that percentage while consistently delivering high-quality care as the year progresses. In addition, we also began taking on full risk delegation in the state of Nevada. We believe that we are uniquely positioned to capture the embedded growth that this pillar represents because of the high level of visibility and consistency that our proprietary technology and clinical infrastructure affords us. I'd like to continue emphasizing a key aspect of our business that distinguishes Astrana Health from other providers and peers. We have always committed to serving all segments of our communities in value-based care arrangements, covering all payer types from original Medicare, Medicare Advantage, managed Medicaid, to commercial. And we continue to forge ahead in our transition to risk and being truly accountable for our members' whole health across those diverse business segments, even as others have shied away. The infrastructure, technology, and team that we have built allows us to do this well. It results in our ability to serve a wider patient population make our providers' lives simpler and more efficient, diversify our business and better manage risk, and support our payer partners across their entire business. With regards to the third pillar of our business, Estrana is focused on providing high-quality care and access to all members. We have noticed continued outperformance compared to historical years in terms of HEDIS, HCC, and other quality-related outcomes. We also continue to focus on making sure members receive the right care in the right setting, leading to our continued strong performance on clinical utilization metrics. Our bed days per thousand and admits per thousand improved in the first quarter when compared to previous periods. This improvement is consistent across all business segments, with Medicare, Medicaid, and commercial authorizations for inpatient and outpatient services marrying this trend. Moving on to the fourth pillar of the business, strategic acquisitions, we successfully closed the second and final part of our community family care acquisition this quarter as we had previously guided. This acquisition marks the largest in Astrana's history and serves as a successful example of a care enablement client deepening its relationship with Astrana Health and moving into the care partners segment. The integration of CFC was seamless as we were already powering the CFC business with our Care Enablement platform prior to the acquisition, showcasing the value and synergy of leveraging our Care Enablement tech-enabled services business. The completion of this transaction allows us to take on greater responsibility for the outcomes of the patients we serve with CFC's full risk Medicaid restricted Nox Scheme license. It also further strengthens our commitment to managing medical costs and providing quality care in our communities.
spk04: Looking ahead,
spk05: We expect to transition the majority of our Medicaid members to full risk arrangements in the next six to 12 months. This quarter, we also completed the acquisition of Prime Community Care of Central Valley, or PCCCV, a risk-bearing provider organization with over 150 primary care and multi-specialty care providers, which serve around 26,000 primarily Medicaid members in the Central Valley of California. Prior to this, our organic growth and partnership efforts in the Central Valley have been robust and PCCCV joining our care partners business will be a further accelerant for our efforts to deliver high quality, high value care to communities in the Central Valley and also represents our entry into San Joaquin County. Over the next 12 months, we anticipate continuing our strategy in the region with PCCCV in the fold, taking greater accountability for total cost of care for these members and further integrating with our care enablement platform in order to advance patient outcomes and empower community providers in the region. And outside of California, we continue to see a rich pipeline of both organic and inorganic opportunities in both Texas, Nevada, and beyond. We believe that the strong growth and consistent execution of our strategic roadmap demonstrate the uniqueness of our platform, the care model, and technology capabilities. Our well-established value-based infrastructure and long track record of managing total cost of care and patient outcomes in value-based arrangements across all payer types with confidence in the ongoing growth and profitability of our platform. To conclude my prepared remarks, I want to express my gratitude to our teammates, providers, and partners for their belief in our vision to transform healthcare and local communities nationwide. The rapid growth and positive outcomes of the business would not be possible without your passion, dedication, and support. With that, I'll hand it over to Chan to review our financial results.
spk06: Thank you, Brandon. Moving into this quarter's performance, we began 2024 with total revenue of $404 million, a 20% increase from $337 million in the prior year quarter. This was primarily driven by increased capitation revenue resulting from organic membership growth in our core IPAs, as well as the addition of CFC IPAs on January 31, 2024. Care partners' revenue increased 26% to $397 million during the period. Along with the organic and strategic growth, partners' revenue increased due to the conversion and addition of full risk membership. As of April 1st, 2024, we expect our full risk business to account for approximately 60% of capitated revenues relative to 49% as of January 1st, 2024. Adjusted EBITDA was 42.2 million. up 42% from $29.8 million in the prior year period. In the first quarter of 2024, adjusted EBITDA excluded certain one-time items, including a $4.7 million expense related to a financial guarantee via a letter of credit that we provided two years ago in support of two independently operated local provider-led ACOs. Despite the removal of these ACOs from the CMS program, the shared losses for that year were recorded and we're working with those two providers to recoup the funds that were spent. As I mentioned, this is not a recurring item, nor do we believe it reflects the operations of our ACO business. Net income attributable to Astrona Health an increase of 13% from $13.1 million in the prior year quarter. Earnings per share on a diluted basis were $0.31, up 11% from $0.28 in the prior year. Now turning to the balance sheet. Our financial position remains well capitalized with $335 million in cash and cash equivalents and total debt of $393 million as of Q1 2024. This compares to $294 million in cash and cash equivalents and total debt of $282 million at the end of 2023. We are steadfast in our ability to execute our growth strategy by expanding our membership through both organic means and strategic acquisitions, as well as transitioning our contracts to full risk. Further, we remain confident that full year projections align with expectations, given our diverse pair mix and ability to manage cost of care. As a result, we are reaffirming our full year guidance for revenue, adjusted EBITDA, and earnings per share. Looking ahead to the coming quarters, the successful completion of the second part of the CFC acquisition is projected to contribute a single digit uplift in Q2 revenue relative to Q1. This will be reflected in the full quarter's impact of CFC on our financials. Historically, Q3 has been our strongest quarter in terms of profitability due to sweeps and ACO-related payments. Our sustained participation in the ACO program has enhanced our capabilities around real-time data gathering and forecasting. Due to the enhanced clarity, we're comfortable this year booking ACO earnings based on the quarter of their contribution. As a result, Q3 will be slightly lower in terms of EBITDA contribution percentage versus historical years. In closing, We're extremely pleased with our performance in the first quarter, which has set a positive tone for the remainder of the year. Our strong organic membership growth, strategic acquisitions of CFC and PCCCB, ongoing transition to full risk arrangements, and the stability and improvements of our utilization metrics represent strong momentum for our business. We have confidence in our ability to continue our long track record of successful execution. We will continue in our commitment to deliver the utmost quality of care to focus on industry-leading patient outcomes and to serve more communities across the country. Thank you for your time today. With that, operator, we'll turn to questions.
spk00: Thank you. Ladies and gentlemen, the floor is now open for questions. If you do have a question, please press star 1 on your telephone keypad at this time, and we'll take one question and one follow-up per analyst. Once again, that's star 1 if you do have a question or comment. And we'll take our first question from Ryan Daniels from William Blair. Please go ahead.
spk07: Yeah, guys, thanks for taking the questions. I'm curious if you could speak a little bit more to your pipeline, either for new partnerships or M&A, especially as we contrast your strong performance versus what some other peers are seeing in the market, meaning is that opening up some opportunities? Is there pressure with provider groups to get new partnerships, et cetera, just any color there would be great.
spk05: Hey, Ryan. Thank you so much for the questions and for tuning in. I think we're seeing a very strong partnership and corporate development pipeline as we speak. As you mentioned, there is a huge desire, especially given cost pressures, margin pressures, utilization trends that some of our peers are seeing, to find a partner that is going to be stable and present a long-term opportunity to provide value back to providers and ultimately back to the patients. And so I think we're absolutely seeing a strong pipeline. I think there was an acquisition that we announced joining our care partner segment this quarter and the close of the CFC transaction. And I believe we are still planning to fulfill our guidance of at least one or two new markets per year as the year progresses here.
spk07: Okay, that's helpful, Culler. And then as my follow-up, good new data on the total cap revenue being at 60% up from 49% in January. I guess my question is now that you have both the Medicare and Medicaid, RKK, how might we see that trend kind of towards year end? So where might you end the year in 2024? And then what would your goals be for 2025 and 2026? Because I know that's a nice kind of revenue and really a care management accelerator as well. Thanks and congrats on the strong performance.
spk06: Thanks, Ryan. In terms of our year end target, as we've discussed before, we still expect to be at about two thirds by year end in our transition to full risk. As we work through 2025, We see us continuing to move our membership into a full risk arrangement, and we do believe we will be able to get the majority of our contracts into full risk by the end of 2025. Great.
spk07: Thank you so much. I'll hop back in the queue.
spk03: Thanks, Ryan.
spk00: Thank you. And we'll take our next question from David Larson from BTIG. Please go ahead, David.
spk03: Hi. Congratulations on the quarter. I was positively surprised at the EBITDA. Can you maybe just talk about claims trend, how that's tracking for your book of business? Some of your peers were hearing, you know, sustained high MA utilization. fairly high single digit claims cost trend. I mean, what are you seeing? How did your cost trend come in relative to your own expectations? And I guess, what is your secret sauce? Why is your trend perhaps better than others?
spk06: Hey, David. Great to hear from you. Thanks so much for the question. In terms of how we're looking at utilization, First in terms of flu, we saw an equivalent to maybe a higher amount of flu cases, but a lower level of acuity. In terms of overall claims trend, as you know, because we do have full visibility around our utilization management and care management capabilities, which leads to us having visibility around authorizations, we are able to have a clearer sense of around MCR. And we see across the board positive trends there, as Brandon mentioned during the call. We see some areas where, for example, due to regulatory reasons, genetic testing is now included in certain Medicaid-related cases, so we see an increase there. But beyond that, we continue to see MCRs that are consistent or favorable relative to historical periods.
spk03: Okay. And then can you put a percent number on your per member per month trend line? Is it below 5%? Is it between 5% and 10%? Below 3%? Any number you can put on that?
spk05: Hey, Dave. Thanks for the question. This is Brian. I don't think we've disclosed the exact trend line, especially because it differs by line of business. I would say that across all lines of business, Medicare, commercial, and MA, I would say it's coming in a few percent lower than we had anticipated at the beginning of the year or prior, you know, prior to this year, prior to this quarter. It is still early in the year, I would say. So, you know, we're here in May, and we, out of conservatism, you know, reaffirm guidance. But I do think early results starting off the year here are promising.
spk03: Okay, and then can you maybe talk a little bit about your approach to managing inpatient services? I mean, it's my understanding that you actually have a strand of hospitalists that, you know, manage care to an extent within inpatient facilities. So should we be worried about a spike in claims costs for hospitals once you start sort of bearing more full risk?
spk05: There definitely will be higher claims costs obviously offset by higher claims, higher capitation revenue as we continue to move into full risk. And we're starting to see that already as we get to around 60% of our capitated revenue in full risk arrangements. However, we don't, while that may be a temporary pressure to overall EBITDA margin, as we've formally discussed, from a raw EBITDA number perspective, it's still accretive, certainly, and we think we're well prepared to take on the full risk and maintain medical margins where we would like them to be because of the ability we have in terms of our hospitals working at the hospitals, in terms of our post-discharge care teams taking care of folks after an inpatient visit, in terms of our deep specialist and primary care provider integration for patients across the CARES continuum spectrum. Even as we grow into new markets, we're seeing we're able to contract effectively with hospitals and replicate some of the elements that we used in California to successfully manage cost of care in both outpatient and inpatient settings. So that's something we continue to keep in mind, for example, as we enter forward as delegated contracts here in Nevada or in Texas or beyond.
spk03: Okay, that's great, very helpful. Thanks very much. And then just... Last one, like CFC integration, how is that progressing? Just any thoughts or color there would be very helpful.
spk05: Sure thing. Yeah, the CFC integration, as I mentioned in the prepared comments, is going very well. All of the providers are now already on our care-enabled platform, obviously, given that it powered CFC even prior to acquisition from a regulatory standpoint. Things have been settled leading to the successful close on March 31st, the second part of the CFD transaction. And throughout the remainder of the year, most of the CFD members are already in forward contracts dating back to the middle of 2023. And there are additional synergies with our existing business that we look to capitalize on for the remainder of the year.
spk03: Okay. Congratulations. Not a great quarter. I'll hop back in the queue.
spk05: Thanks so much, Dave.
spk00: Thank you. And we'll take our next question from Adam Ron from Bank of America. Please go ahead, Adam.
spk08: Hey, super quick one. So the 60% number that you're talking about for capitation that you're using, I want to make sure I understand it. So you're saying for 60% of what you're reporting as capitation revenue, that number that you're reporting is some capitation rate, let's call it 85% of whatever the benchmark that you're managing is. And if that's true, that I'm understanding that correctly, on the remaining 40%, what is roughly the capitation rate that you're doing today and can that go to 85%? Because that could give us a sense of what the dollar opportunity and revenue is from here. Thanks.
spk05: Hey, Adam. Thank you for the question. Thanks for tuning in. You're absolutely correct in your understanding. 60% of the capitated revenue that we report in the Care Partners segment comes from an arrangement in which call it approximately 85% of the premium dollar, is being given to us in a capitated value-based arrangement. Of the other 40% of the dollars, I would say that those are mostly coming from arrangements in which we have outpatient risk only, which would be, illustratively, call it around 35% to 40% of the premium dollar. So there is additional opportunity we anticipate capturing some of it over the remainder of this year, some of it into 2025 in terms of converting some of those contracts into full risk, you know, 85 approximately percent of premium contracts.
spk08: Okay, now that's perfect. And then in terms of the MLR, it seems pretty significant to your point. You said trend was a couple percentage lower than what you thought it was, which, you know, on a 10% margin business is pretty substantial. So, Yeah, just curious, one, why you didn't raise the guidance, and two, what are the big factors or expectations that are coming in different? And then three, somewhat unrelated, but in the 2025 rate notice, one of the surprising aspects was in Los Angeles, the rate for growth rate of trend was 5% while the rest of the industry got like 2.4 or something. I'm curious if, like, CMS's view of what's happening in L.A. County is different from yours, where potentially they're saying trend is accelerating, and then on the other hand, you know, into 25, is that a tailwind for you, or is it entirely offset by, you know, what the payers are doing with benefits? Thanks. Appreciate the answer to the multifaceted question.
spk05: Yeah, of course. I'll try to take them one at a time, Adam. So on the Well, I just want to clarify in my prior response that the 60% of capitated revenue that's full risk is as of April 1st, just the day after the end of the quarter here. Right, right. After the close of CFC. Just making that clear. In terms of kind of the utilization trends that we're seeing, as Sean mentioned and I talked about, I'll give a little more color. You know, we are encouraged, cautiously optimistic about the trends we're seeing in terms of utilization. We are seeing kind of broad-based support. um, for the increase or the decreases rather in utilization trend across different lines of business, different pockets of the business. There are a couple of pockets that Sean mentioned earlier, for example, um, that are maybe higher than expected, but overall the trend is very, you know, it's positive. Um, I would say that the reason for not increasing guidance at this point in time, um, you know, it's thoroughly in the year, uh, Adam, you know, I think we, again, cautiously optimistic, but I think we, um, We probably still fall within the range. There's a bit of increased investment in the teams and new market entry, and we think we're on track, and we'll provide more updates as the year progresses. In terms of the question on Los Angeles MA benchmarks, overall, I would say we were fairly disappointed, as others were, with the MA rate notice, the final notice. I think the As you mentioned, the L.A. benchmark came in a little higher than maybe we had thought compared to other regions. So we think that could be a tailwind for sure. But, again, it's still early in the year. We're still negotiating and talking to payers, working with our partners around some of the benefits that will take place in 2025, how the plan will be designed. So all of this will holistically probably be what will go into the final kind of economics that we anticipate for 2025. So we'll have further guidance on that to you in the coming months.
spk08: Great. Thank you. Thanks, Adam.
spk00: Thanks. Thank you. As a reminder, please limit your questions to one with a follow-up. And we will take our next question from Jack Slevin from Jefferies. Please go ahead, Jack.
spk04: Hey, thanks for taking the question and congrats on the quarter. I want to do a bit of a double-click on the Nevada contract. Can you give a little more color on maybe what payer class that risk contract represents and, you know, sort of what you're seeing that made you want to flip that on immediately in Nevada or if sort of the infrastructure and the market entry costs you've been building up over the last year are there and ready to hit the ground running on it?
spk05: AJ, thanks for the question. Yeah, so in Nevada, we've been in some shared risk arrangements or partial risk arrangements about a year, maybe a little more than a year at this point. The full risk contract that we turned on was a Medicare Advantage contract, and it's one in which we actually have delegated payer responsibilities. So we have prior, you know, utilization management, care management, claims, credentialing, contracting, et cetera, which very much looks similar to the infrastructure we built in California. We felt comfortable turning it on after looking at some of the results while participating under a shared risk arrangement, as well as the confidence in the infrastructure we've now built in Nevada over the last, call it, 12 to 18 months. So that's something that, while still a fairly small book of business, relatively speaking, we're excited to continue to prove that the model scales outside of some of our core regions.
spk04: Got it. Thanks for the cover there. And then just on the forest transition, a lot of moving pieces that we're hearing from MA plans in particular, but sort of on cost trend broadly, just thinking about, I know you guys have a lot of visibility into, you know, the opportunity there given the role that you play currently. But as you think about adding inpatient risk throughout a lot of, you know, probably what is the California base, you know, how are you measuring up sort of moving pieces with cost trend, you know, that are underlying and move that plans might be making on how they bid into next year? when factoring in how you do transition those lives? Is it sort of still just push on as quickly as you can, or do you have to be a little more selective given the environment?
spk06: Sorry, John, go ahead. No. So, Jack, in terms of our contracts, I don't want you to think we're moving contracts over if ACTUALLY POST ANALYSES, IT DOESN'T MAKE SENSE FOR US TO DO SO. SO WE ARE LOOKING AT OUR CLAIMS TREND. WE ARE LOOKING AT OVERALL MEDICAL TREND. WE ARE LOOKING AT THE UNIQUE CAPABILITIES WE CAN BRING TO THAT MARKET IN TERMS OF OUR MEDICAL MANAGEMENT CAPABILITIES, OUR CARE MANAGEMENT CAPABILITIES, AND THE TECHNOLOGY THAT WE CAN OFFER IN THAT LOCAL MARKETPLACE, AND AS THAT As that links together and in many markets we have an amount of risk already, we then move forward in a very prudent fashion.
spk04: Got it. Appreciate the color and congrats again on a really strong quarter. Thanks, Chuck.
spk00: Thank you. And next we will go to Jalindra Singh from Truist. Please go ahead.
spk01: Thank you, and thanks for taking my questions. First question on the care delivery business saw around 8 million sequential decline. I understand last quarter in Q4 you had some true ups, so that probably was expected. But anything you can highlight there in terms of trends you saw in the business? And is Q1 the good run rate for the rest of the year for that business? Just trying to understand if there was any impact from change, healthcare disruption on that business.
spk06: Hey, Jaludra. Thanks so much for your question. In terms of the change from Q4 to Q1, Q4 and Q2 is usually when there's annual quality bonuses as well as any one-time true-ups that happen on the delivery side of the business. So that's the change that you see. In terms of change and the impact, we have very minimal change-related business in terms of our delivery assets so that there's not an impact there.
spk01: Okay. Use Q1 as a good run rate for the rest of the year, right, from a revenue point of view.
spk06: Yeah, we will see some enhanced profitability in Q2 and Q4 from those bonuses as they come in.
spk01: Right. In my follow-up, a managed care company last week called out pressure in the ACO business driven by some data they received from CMS impacting their 23 results and also their 2024 assumptions. With you guys entering MSSP this year, and I believe you're accruing towards breakeven margins, Just curious what you have seen in your data. I understand it's clearly limited, but just curious if there's anything to flag from your experience point of view. And similarly, outside of that 4.7 million adjustment you called out in ACO REACH, can you talk about your experience in that program in general?
spk05: Hey, Jalandhra. Thank you for the question. I think your first question, and please correct me if I'm wrong, is around MSSP and our experience so far early on. And we had underwritten to approximately break-even given the first year of our participation. In MSSP, we are still underwriting this quarter to a break-even given the lack of, you know, large experience in that program. I would probably guess that MSSP profitability, especially because it's coming in, you know, on a 15 to 18-month cycle, would probably show up most likely in 2025 financials and not this year, and we haven't contemplated any profitability from MSP ACO in this year's financial projections. On the ACO REACH business, which we do have more experience in, a couple clarifying points. The first is that the $4 to $5 million adjustment that John mentioned, that was fully taken in terms of the charge this quarter. It's a one-time thing. It also isn't related to our ACO REACH, but rather separate ACO REACH businesses, as John had explained earlier. In terms of our ACO REACH's performance, we're actually seeing pretty promising results. We are booking a bit of profitability this quarter, as John mentioned, because of the increased visibility and the confidence we have that the medical cost trends are fairly positive, even in the ACO REACH program.
spk01: Thanks, guys. Thanks, Alondra.
spk00: Once again, Star 1, if you do have a question. And next we'll go to Christian Borgmeier from TD Securities. Please go ahead.
spk02: Hi, everybody. This is Christian Borgmeier. I'm from Gary Taylor. Thanks for the question. So as we think about the Medicaid redetermination period winding down, what are you seeing lately in terms of re-enrollment through exchange and commercial products? Are you noting any disruptions in care for patients as they navigated through any re-enrollment? And if there's been a lapse in care, what tools does Astrona deploy to reengage some members that may have not been seeing their PCPs lately? Thanks.
spk05: Hey, Christian. Thank you for the question. As I mentioned earlier, we still saw growth in Medicaid around 7% year-to-date, even net of redetermination. And the commercial slash exchange business rose by even more than that. It was well over 16%, I believe, in the commercial segment based on some of the recapture, as I mentioned, of redetermined Medicaid members into exchange. I would say that the efforts have largely gone successfully. Medicaid as a business has still grown despite redetermination, and we're not seeing any higher acuity levels in the remaining Medicaid members as compared to prior to redetermination. As you mentioned, the redetermination period is ending in a short while, so I think for the most part, headwinds around that redetermination program are generally mitigated from our point of view. In terms of member engagement, continuity of care, we think that's a really strong point of differentiation for our model. Patients who redetermine or are in a different type of insurance plan or even a different payer, I know it's not your question, but even for Medicare Advantage, we still have access to the exact same care team, social workers, post-discharge planning, technology platform, and primary and specialty care providers. Now, increasingly, 60% of it for their institutional network as well. There's really a strong ability for us to continue care in the exact same way the patient has experienced it, leading to more longitudinal relationship with the patient and ultimately investing allowing us to invest more in the patient's health over time. So we think that's a big part of the model that discussed earlier, that we are so diverse in terms of how we serve the patient, and we think that's paying off as we've gone through this Medicaid redetermination process.
spk02: Okay, got it. That's helpful. Thank you. Thanks, Christian.
spk00: As a reminder, Star 1, if you do have a question or comment, And there appear to be no further questions at this time. I'd like to turn the floor back to Brandon Sim for closing remarks.
spk05: Thank you, everyone, for tuning in this evening to our first quarter of 2024 earnings results. As always, we are around in our offices in both Alhambra, California and Las Vegas, Nevada. If you're in the area, please don't hesitate to email us if you'd like to meet. We look forward to discussing our results next quarter and seeing you again. Thank you and have a good evening.
spk00: Thank you. Ladies and gentlemen, this does conclude today's teleconference. We thank you for your participation. You may disconnect your lines at this time, and have a great day.
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