1Life Healthcare, Inc.

Ladies and gentlemen, thank you for standing by. And welcome to One Medical's fourth quarter 2020 earnings conference call. At this time, all participant lines wanna listen on the mode. After the speaker's presentation, there'll be a question and answer session. To ask a question session, you will need to press star then one of your telephone. We ask that you please limit yourself to one question and one follow up. Please be advised that this conference is being recorded. If you require any further assistance, Please press star then zero. I would now like to hand the conference over to your host, Rose Salzwede, Director of Investor Relations. Please go ahead.

Thank you, operator. Hello, everyone, and welcome to One Medical's fiscal 2020 fourth quarter earnings call. I am joined today by Amir Dan Rubin, Chair and CEO of One Medical, and Bjorn Thaler, Chief Financial Officer of One Medical. A complete disclosure of our results can be found in our press release issued earlier today, as well as in our related form 8K, all of which are available on our website at investor.onemedical.com. As a reminder, today's call is being recorded, and a replay will be available on our website. As part of our comments today, we will make forward-looking statements. These statements are based on management's current views, expectations, and assumptions, and are subject to various risks and uncertainties. Actual results may differ materially, and we disclaim any obligation to update any forward-looking statements or outlook. Please refer to the risk factors in our most recent annual report, as updated from time to time by other reports and filings with the SEC, including our quarterly reports. We believe that the COVID-19 pandemic creates particular complexity when it comes to providing a forward-looking view of the business. And we are providing our guidance on a good faith basis per recent SEC recommendations. We would like to specifically caution investors that our future performance will be harder to predict for their foreseeable future. Our forward-looking statements are based on assumptions that we believe to be reasonable as of today's date, February 25th, 2021. Information contained in today's statements should not be relied upon as representing our estimates as of any subsequent date. Of note, it is one medical's policy to neither reiterate nor adjust the financial guidance provided on today's call unless it is also done through a public disclosure, such as a press release or through the filing of a Form 8K. Today we will discuss certain non-GAAP metrics that we believe aid in the understanding of our financial results. A historical reconciliation to the comparable GAAP metrics can be found in today's earnings release. Finally, during the call, we may offer incremental metrics to provide greater insights into the dynamic of our business. These details may be one time in nature, and we may or may not provide updates in the future. And with that, I shall turn the call over to Amir and Bjorn for their prepared remarks and to take your questions.

Welcome to everyone on the call, and thank you for joining us. Today, we report another quarter of significant outperformance across all key financial metrics. We are pleased to report a strong finish to FY20. capping off our impactful first year as a publicly traded company. Our human-centered and technology-powered model continues to resonate with more consumers and more employers than ever before. We ended the quarter with 549,000 members, growing 30% year over year. In addition to strong consumer growth, more than 8,000 employers are now sponsoring memberships on behalf of their workforces, compared to more than 7,000 employers at the end of 2019. Coming out of our record Q3, we were pleased to hit another membership milestone in Q4, as it was our best quarter yet of net new member addition. We added this record number of net new members while continuing to deliver an elevated experience with a net promoter score of 90. As we've shared previously, our modernized healthcare model has also been linked to reductions in healthcare spending of 8% to 45% for employers. We believe our ability to deliver outstanding experiences while facilitating cost reductions makes our model differentiated and transformational. Moreover, we continue to see 9 out of 10 consumer members renew with us in 2020 and also continue to retain more than 90% of our enterprise contract value. Our ability to transform healthcare is also enabling our strong financial results. We delivered $380 million in total FY20 net revenues. which grew 38% year-over-year. In Q4 alone, we delivered $122 million in total net revenue, growing 57% year-over-year, nearly double our growth rate in the same quarter last year. We delivered FY20 care margin of $145 million, or 38% of net revenue, while at the same time launching four new markets and continuing to invest across our organizations. We delivered FY20 adjusted EBITDA of minus $13.9 million, which reflects an $11.1 million improvement to FY19. In Q4 specifically, we delivered a historically high $11.2 million of positive adjusted EBITDA, or positive 9% of Q4 net revenue. These results showcase the continued momentum in our business, and serve as further indication of our ability to achieve our long-term financial targets. Let us now share further highlights from 2020 and how our model continues to serve our key stakeholders, which include consumers, employers and payers, providers, and health networks. It has been a privilege to serve our consumer and enterprise members as they entrust us with their health and care every day, especially during these pandemic days. We continue to see strong engagement in 2020 while at the same time, we served more members across our existing markets and in new markets. Throughout the year, we demonstrated our unique ability to provide longitudinal care across digital and in-person settings, enabling record levels of engagement with our model compared to prior periods. We supported over 5 million interactions during 2020, which grew more than 80% year over year. During the 12 months of 2020, we engaged with members an average of 10 times including approximately eight times digitally and twice in person. Our membership model and bundled digital health services enabled inbound synchronous and asynchronous interactions, as well as outbound population health interactions. Thus, we not only address the acute care and COVID-19 needs of our members, but also their ongoing chronic care and well-being needs, including support for cancer screenings, well-women care, family care, behavioral health, and more. Additionally, our members and providers continue to build trusted ongoing relationships through both scheduled remote visits and convenient in-person care. Our welcoming offices supported superior in-person experiences along with the service-oriented outdoor sites we launched for COVID-19 testing. We believe the extensive engagement we saw in 2020 highlights our ability to provide responsive as well as proactive care and to provide acute as well as longitudinal health care across a range of delivery modalities. Our impactful relationships with our members fueled us to reach out to more people and enterprises across existing and more new markets. Last year, we entered Portland, Oregon, Atlanta, Georgia, Orange County, California, and most recently, Austin, Texas. As we previously announced, we plan to enter Raleigh-Durham, North Carolina, Columbus, Ohio, Milwaukee, Wisconsin, and Houston, Texas within the year. While there continues to be a tremendous opportunity for significant growth in our existing markets, expansion into new geographies further advances our network's attractiveness to multi-market employers and consumers. Accordingly, in addition to our national digital health coverage and One Medical Now reach, our expansion into four new markets during 2021 will take us to 17 markets by the end of this year. This represents 30% growth in market count during 2021 alone. Collectively, our 17 planned markets represent a total addressable market opportunity of $44 billion in the commercial primary care segment alone, before considering any expanded populations or services. In addition to growing within existing markets and into new markets with consumers, we continue to see outstanding growth in our enterprise business across organizations of various sizes, industries, and geography. During Q4, we began new relationships with organizations in manufacturing, technology, education, professional services, biotech, medtech, nonprofit, financial services, real estate, amongst others. Throughout the year, we also continued to grow alongside existing clients, expanding coverage with dependents and further extending into additional services, such as pediatrics and behavioral health. With our high engagement, retention, and satisfaction levels, we believe we can continue to see great opportunities to further grow within our existing client base. In addition to being a highly engaging benefit that employees and dependents tell us they love, we deliver value-based results to employers and payers as we help manage the health and cost of care of our member population. Our technology platform, membership model, and clinical team and enable us to proactively reach out to members for preventive care, screenings, and chronic disease management. We develop personalized care plans and engage members to act on these plans through the modality of their choosing, whether that's in person, in an office, in a drive-through site, remotely through scheduled virtual appointments, or digitally through asynchronous or synchronous on-demand virtual care. As you may recall, our model is linked to employer savings, including over 8% in a case study and up to 45% as per a seminal study published last year in JAMA Network Open. As discussed in the JAMA article, savings included 54% lower spending on specialty care, 43% lower spending on surgery, 33% lower spending on emergency department care, and 26% lower spending on prescriptions. By acting as a low-friction healthcare home for employees, we can engage our members in improving their ongoing levels of health and well-being and help reduce expensive and avoidable downstream medical costs. Now, even as our membership-based and technology-powered model delivers outstanding impacts to consumers and employers and payers, it also provides a more fulfilling way for providers to practice medicine, a way that isn't driven by piecemeal fee-for-service compensation that is so endemic in the healthcare ecosystems. a way which alleviates desktop medicine burdens from cumbersome technology for providers, and a way which streamlines the manual coordination of insurance authorizations and specialty referrals that is promoting burnout in physicians across the nation. Our model supports our clinical teams in developing ongoing relationships with our members to help close gaps in preventive and chronic care. Our salary-based compensation approach supports providers in delivering the right care at the right time, irrespective of whether that care is delivered in person or virtually. Our purpose-built technology platform can help reduce 40% of the tasks providers often experience in other electronic health record systems and organizations. Accordingly, we believe that our model enables a more professionally rewarding and impactful experience, while also reducing the factors driving burnouts. supporting our efforts to attract and retain more and more of the best providers anywhere. During the quarter, we also advanced our health network partnerships to further build clinical and digital integration for more seamless specialty care and to further support our providers in coordinating care across a continuum of settings. In December, we were delighted to launch in Austin, Texas, alongside our partner, Ascension Texas Healthcare, We celebrated the launch of four new partnerships in 2020 as well, including Mass General Brigham, Emory Healthcare, MedStar Health, and Ascension Health, in addition to expanding into two new markets with our existing partner, Providence St. Joseph Health. Building on our momentum in 2020, we've already announced partnerships across all our planned new markets, including with Duke University Health System, Ohio State Medical Center, and Houston Methodist Health System. Now, let me acknowledge our entire team for the support given to our members, employer clients, partners, and communities during this past year. They have been delivering such outstanding and compassionate care as we reached more members, clients, and communities than ever before in the most extraordinary of times. While we do not completely know what lies ahead as a result of the pandemic, we do know that our employees will continue to be there to serve our members, employers, and communities. As we've described, our team's collective efforts are here to help transform healthcare by serving the needs of key stakeholders, consumers, employers, and payers, providers, and health networks. We are delighting consumer and employee members with seamless digital health and inviting in-person care, enabling millions of engagement points per year. We are serving more than 8,000 employers with a highly engaging benefit, while at the same time, lowering costs by promoting population health, value-based care, and improved productivity. We are creating a more fulfilling way to practice primary care with a salaried model with modern technology that emphasizes relationships and minimizes transactional burdens and friction. We are building connectivity with distinguished health network partners to further digitally and clinically integrate care across primary and specialty settings to help own the complexity of navigating care for our members and providers. As a result of these efforts, we have delighted members, as seen in our 90 Net Promoter Scores, while also demonstrating we can reduce up to 45% of health benefit costs. We believe the opportunity to delight members and reduce the cost of health care is truly transformational and have never been more excited about the opportunity ahead for our organization. Before I turn the call over to our CFO, Bjorn, let me take a few moments to update you on our COVID-19 vaccination efforts. Our national presence, digital tools, and scaled infrastructure support us in these efforts. With limited quantities of vaccines currently available, we are partnering with departments of public health to serve vulnerable community members. For example, in New York City, we are providing vaccinations at homeless shelters, and in other markets, we are vaccinating frontline healthcare workers, teachers, and other essential workers. We are also providing complimentary telehealth services to individuals referred to us by local departments of public health. During the course of vaccination services, these individuals can leverage our platform for vaccine appointments and second-dose reminders, but also for follow-up video chats and messaging to address their healthcare needs and concerns during this time. While it is early days in the vaccine rollout, once vaccine eligibility opens up to broader populations, we believe that our multimodal service model positions us well to continue to support our communities, our members, and our employer clients. To those joining us today, we thank you for your continued support and partnership in our mission. Now, over to you, Bjorn.