MultiPlan Corporation

Ladies and gentlemen, thank you for standing by and welcome to the Multi-Plan Corporation Third Quarter 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. After this speaker's presentation, there will be a question and answer session. To ask a question during this session, you will need to press star 1 on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press star 0. I would now like to hand the conference over to your speaker today, Shawna Gassick. Thank you. Please go ahead, madam.

Good morning. Thank you for joining us today for Multiplan's third quarter 2020 earnings call. Today our speakers will be Mark Tabak, Chief Executive Officer, Dale White, President of Payer Markets, and David Redman, Chief Financial Officer. Paul Gallant, President of New Markets, will be available for the Q&A session. During the call, we will refer to the slide deck you will see during the webcast, or which is available on the investor relations portion of our website, along with the third quarter earnings press release issued earlier this morning. Before we begin, I'd like to remind you that our remarks and responses to questions may include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those stated or implied by forward-looking statements due to risks and uncertainties associated with our business, which are discussed in the risk factors included in our registration statement on Form S-1 and other SEC filings. Any such forward-looking statements represent management's estimates as of the date of this call. While we may elect to update such forward-looking statements at some point in the future, please note that we assume no obligation to do so. Certain financial measures we will discuss on this call are non-GAAP financial measures. We believe that providing these measures help investors gain a more helpful and complete understanding of our financial results and is consistent with how management views our financial results. A reconciliation of these non-GAAP financial measures to the most comparable GAAP measure calculated and presented in accordance with GAAP to the extent available without unreasonable effort is available in the earnings press release and in the presentation slides included in the investor relations portion of our website at www.multiplan.us. I would now like to turn the call over to our Chief Executive Officer, Mark Tabak.

Thank you, Shauna. We'll start on slide number three. Welcome, everyone, to Multiplan's third quarter earnings call. My team and I are very excited about this important next chapter of growth for our industry-leading company following our recent debut on October 8th. I've been at the helm of Multiplan for almost three decades, and have never been more enthusiastic about our future. To start us off, I will give a few remarks and hand the presentation over to Dale to talk about our business and the progress on our three-part growth strategy, and to Dave to talk about financials. Next, please. From a financial perspective, we delivered a strong third quarter. With revenues of $224 million and adjusted EBITDA of $166 million, we performed significantly better than we anticipated initially projected at the start of the pandemic, and also better than the updated projections that we gave you at our August 18th Analyst Day. The year-over-year decline is due to COVID, which impacted us less in Q3 than in Q2, but did cause a drop in realized customer savings that drive a big part of our economics. Dave will give you some more detail on that later. Now, based on where we sit today, we believe that we will deliver a strong fourth quarter with revenues in the range of $238 to $253 million and adjusted EBITDA in the range of $180 to $194 million. At the midpoint of that range, this represents a revenue growth rate of 9.8% quarter-over-quarter and minus 0.4% year-over-year. In adjusted EBITDA, the growth rate is 12.3% quarter-over-quarter and 0.3% year-over-year. During the time since our August 18th Analyst Day, our team has continued to execute our enhanced, extend, and expand three-part growth strategy we call Multiplan 3.0. As you will see in Dale and Dave's presentations, our third quarter financial performance is not only driven by a lower than initially projected U3 COVID impact, but also, more importantly, from executing our growth initiatives. Growth initiatives include new customer contracts, and new products that play a meaningful role in building our business. We continue our customer extension to both highly penetrated and under-penetrated segments. We are in the process of adding new sales, more business development, and product management talent. Let me share some concrete accomplishments that the team delivered since our analyst day. Our large and successful refinancing has enabled us to increase the duration of our debt, reduced leverage, increased our revolver, reduce our annual interest expense by approximately $70 million. We were also pleased that Moody's upgraded our credit rating to B2. We made progress on several of our 16 strategic initiatives that support our enhance, extend, and expand growth strategy, delivering annual revenue impact of $15 to $20 million. And I'm happy to announce that we completed the acquisition of HST earlier this week. It gives us a new product capability in support of our enhanced strategy deepens penetration in adjacent markets that we are targeting with our extend strategy. Dale will go into details of the acquisition, which we believe helps to de-risk our execution and accelerates our growth. Equally important, this acquisition was executed at an attractive price and will be accretive to Multiplan. We will continue to pursue these types of acquisitions with discipline and support of our growth strategy. Next. It's important that I set the record straight on some narratives from someone attempting to run a short campaign against Multiplan. Multiplan has been in business for more than three decades. We serve all the major insurers in the US. We serve more than 60 million people and work with 1.2 million providers. We are a real and extraordinary business that has made money for every investor that has ever invested in Multiplan. The management that runs this business built it and helped build an industry. It is offensive to have anyone suggest anything else. There were four assertions that we have heard that I have listed on this slide, all of which are completely false. In addition, I added up this topic, which I will cover as well. The first assertion made by the short seller is that UnitedHealthcare is planning to exit the relationship with Multiplan, and in effect, in-source what we've been doing and what we've been using, and they plan to use a reference pricing tool with a consumer advocacy service called NaviCard. That is absolutely false. Our business with UnitedHealthcare continues to grow every quarter. Second, MultiPlan's relationship with large payers is deteriorating, leading to a reduction of our pricing by 50% over the last four years. This, again, is absolutely false. Our business is growing with our top customers. Third, that Multiplan used financial engineering to prop up its earnings to show better financial performance in 2018. Again, this is absolutely false. Revenue reserves at Multiplan are small, and changes to those reserves had completely immaterial impact on our 2018 revenues. Fourth, that Hellman and Friedman gutted the company and couldn't find a buyer until Churchill came along. This, again, is absolutely false. Multiplan was executing its standalone private market strategy, and the merger with Churchill was done to reduce leverage, infuse additional operating talent, and pursue a more aggressive plan to grow both organically and through mergers and acquisitions. And finally, something that did not appear on the short-seller manifesto but has been a point of concern for some investors is they fear that Multiplan is vulnerable to potential federal legislation surrounding added network claims that can generate surprise bills. As we've communicated in prior calls and meetings, we believe only a small portion of our business is at risk from these types of legislation, and we've put together much more analysis to hopefully help investors better understand how these types of laws, which are already present in 30 states, impact our business. Next, please. Let me drill down into United Navigard. There is so much wrong with what the short seller manifesto has said that I candidly don't know where to start. First, United is not leaving Multiplan. This has been an extraordinary customer, partner, and industry leader. They have worked with us continuously since 1994 and are continuing to grow their business with us. Even in a tough year like 2020 with COVID, United has expanded the business that we do with that they do with us to include more programs and more initiatives, all of which leads to more savings opportunities. They do this because we deliver extraordinary service, value, and quality. We enable customers like United to reduce medical costs and to generate revenue by leveraging multi-plan solutions for both self-insured and fully insured employers. By the way, we have a multi-year contract with United that has been renewed numerous times over the course of our 25-year-plus relationship. Think about it. Why would a payer leave us when we provide an independent cost-managed solution that saves them and their employer customers billions of dollars in medical costs, not to mention administrative costs, every year at a bargain cost to them? The answer is they don't leave us, and instead they give us more business and partner with us to find better and better ways serving their end customers and members. Now, let me address NaviGuard. Let me be clear. NaviGuard is a helpful service and in no way is a replacement for the sophisticated suite of products that Multiplan provides. NaviGuard addresses a particular niche, which Multiplan is a broad-based and comprehensive cost-managed solution with a 1.2 million provider network used by 700 payers that processed $106 billion in claims in 2019 and identified more than $19 billion in potential savings opportunities for our customers. Reference-based pricing services determine a reimbursement to be paid by the plan for added network claims using a reference point such as Medicare. And then if the provider sends a balance bill, that solution can offer online tools and perhaps consulting services help the patient negotiate the balance bill directly with their doctor. Multi-Plan enthusiastically supports UnitedHealthcare and the work they are doing to help their customers and their plan members when a balance bill is received. While reference pricing services can do much to help the member, we do not agree with the assertion that these services protect members completely from balance billing. The only way a member is fully protected from a balance bill is through a contract or other agreement with the provider to accept the plan's reimbursement as payment in full. We also don't agree with the assertion that United or any major payer is likely to shift all of its business to reference-based pricing services like Navigard. The choice of an employer to adopt reference-based pricing depends on the employer's objectives for its health plan. Employers seeking to minimize plan costs will favor reference-based pricing, while those seeking to protect employees will stay with a more traditional benefit plan design. In reality, interest in aggressiveness versus generous health plan approaches will always ebb and flow, as the economy does. As you can see on this slide, we have attempted to show the comparison between what reference-based pricing services do and what Multiplan does. They are apples and oranges. Multiplan supports a wide variety of benefit plan design, including reference-based pricing. Reference-based pricing services offer only one approach. And furthermore, large insurers serving a variety of self-insured customers will always need to offer a choice in benefit plan designs. Their customer base is not a one-size-fits-all. I should also make it clear that Churchill, like any sophisticated investor, performs significant diligence about Multiplan and its customers, including United Healthcare, and was satisfied that those relationships are rock solid and represent a foundation for Multiplan's continued future growth. On a final note, our relationship with United is as strong as it's ever been, and in fact, it's expanding, not shrinking. We have a number of exciting initiatives that have either deployed this year or are implementing involving several of our key services, spanning several United lines of business and also benefiting a number of of the UnitedHealthcare family companies. Next, please. The second topic to address is our relationship with our top customers and the completely false assertion that they are unhappy with us and are going to leave us in droves. Our relationship with our customers across our market segments are as strong as ever. Our customers' commitment to partner with Multiplan has never been more robust, and our pricing has remained steady the normal give and take between volume and price. As we talked about on our analyst day, Multiplanet is an important value-added partner to all of its payer customers. We play an essential role as a fully independent third party, addressing claims and identifying savings. Independence is a cornerstone of our business model, along with our deep IT and process integrations into the prepayment workflows of our payer customers. These two elements allow us to quickly process claims, reduce costs, and help protect members from potential balance billing. As he said in the past, and the data supports it, our largest customers continue to perform in line with our overall business, which is growing. While 2020 has seen a drop in healthcare utilization resulting from the COVID-19 pandemic, we continue to see strong relative performance among our top payers even in the last two quarters, as they use a variety of multi-plan solutions to contain costs and protect their members. The growth for our top 10 customers, as shown, would have been even stronger if not for the idiosyncratic headwinds we felt in 2019, an issue we've covered numerous times before that was unique to a specific customer group. As we have said all along, our take rate with customers remains steady. We'll note there has been some confusion with the way we've been disclosing savings and revenues, which I can sympathize with. So I've asked Dave to tackle this later in the presentation. In short, while the prices we charge our customers are mostly volume-related and are high single-digit to double-digit percentages of savings, they realize our revenue divided by the savings we identify does not equal our take rate. Our payer customers are the final decision makers of how much of the identified savings that we provide them they actually use. As you can imagine, we prefer to avoid disclosing specific pricing levels for competitive reasons, but the prices we charge and the conversion rates of savings into revenue have not seen anything like the types of headwinds floated out there by these short sellers. We have had a productive year extending contracts signing on new logos, rolling out new programs that will lead to greater revenues for Multiplan and more savings in value for payers and consumers. Let me now turn to the third topic to clear up speculation that Multiplan used aggressive accounting policies to mask performance in 2018. Revenue reserve leases had a $1.1 million impact on revenues in 2018. In fact, we had less benefit in 2018 than in 2017. Our year-over-year reported revenue growth in 2018 was lower as a result of these accounting policies. Revenue reserves are small in the context of our total revenue, not the 10% to 30% type of figures described in the short seller's manifesto. Each year, Multiplan reviews appeals and other changes to the savings we generate to do our best to conservatively reflect our revenues. What is more frustrating about this claim is that in 2020, revenue reserves have actually been a headwind to reported revenue growth. Year to date, we have seen a $14.5 million headwind associated with revenue reserves as reserves have slightly grown since December. I'm proud of our finance and accounting team, led by longtime CFO Dave Redman, We will continue to appropriately and conservatively recognize revenues at Multiplan. The last short seller claim I'd like to address relates to the Churchill merger and Multiplan's prior private equity ownership. Our company was by no means underinvested in and was not at any point for sale by Hellman, Friedman, and our other investors. Multiplan was investing in our capabilities and seeing strong growth in our newest products like data eyesight and payment integrity. To reiterate, our company was not for sale. Churchill unilaterally approached us in the spring with a powerful thesis around unlocking and accelerating growth. That thesis, along with a robust pipeline of opportunities, led to the merger, the leveraging, and public listing of our equity. Multiplan successfully partnered with private equity firms as Multiplan has successfully partnered with private equity firms for two decades as we grew the business through both organic product development and M&A. But the public listing was the right step for our company. Multiplan's robust margins and free cash flow are a result of our scale and long-term commitment to technology and automation, not the result of our capital structure or ownership. Next slide, please. Let me now discuss proposed federal surprise billing legislation. This is not a new story, but it bears further scrutiny. Surprise billing laws are designed to protect consumers from unexpected medical bills. These laws say that for certain types of providers, primarily emergency rooms, anesthesiologists, radiologists, pathologists, consumers cannot be billed for an out-of-network charge when they unknowingly arrive at an out-of-network ER facility or have an elective procedure at an in-network facility which employs an out-of-network physician. Why? Because in most cases, the consumer was not afforded the opportunity to choose an in-network provider. So, for example, if you go to an in-network ER to have your fractured leg set, the surprise billing law would say that you cannot be hit with a surprise bill for the out-of-network anesthesiologist who assisted with the procedure. All of these laws aim to eliminate unexpected healthcare bills to consumers. which we, of course, support, as it is consistent with our core mission to make healthcare more affordable, efficient, and fair. Multi-Plan has long communicated, as we did again on Analyst Day, that the exposure of a potential federal surprise billing law would be about $90 to $100 million of revenue. I want to give you two points of analysis that suggest the impact could be less than this, one which shows impact from state laws of only 0.9 to 2.7% of identified potential savings on surprise bill-related claims that we don't know the exact mechanism that a potential federal law may employ or when, if ever, it may go into effect or how exactly its impact will resemble the state laws. The first point is what drives this estimated impact in the first place. As you see on page seven of the presentation, about 79% of the $17 billion that Multiplan identified as potential savings for its commercial payer customers in 2019 came from claims that are unrelated to surprise bills. These identified potential savings are in no way impacted by current state and proposed federal surprise billing laws. So, we were talking about the remaining 21 percent or 3.6 billion of the total identified potential savings that came from claims addressed by surprise billing laws. Now, out of the 21 percent of related identified savings, approximately 11 percent was generated through our provider network and negotiation services, both of which, by contract with the providers, eliminate surprise bills and are likely not a headwind to our business. Remaining 10 percent, or $1.7 billion of identified potential savings, come from claims that could be at risk from surprise bills and surprise billing laws. And this is where our history with state surprise billing laws helps to inform our expected impact from a federal surprise billing law. As I will show you in the next two pages, our experience in the states show that very few customers stop sending us surprise bill related claims as a result of state surprise billing laws being enacted. And those that did grow only about 2.2% were 374 million out of our $17 billion in identified potential savings. Next slide, please. There's a lot of detail on this page and Dale White will take you through the process in his section. For now, let me focus us on what happens if a federal surprise bill is passed using the hybrid approach, which is one we believe is most likely to occur. With the hybrid approach, the biggest risk to Multiplan is on claims under $750. Here Multiplan may be asked to provide the reference price and to process the claim, or the payer may choose not to send the claims to us for processing, and we would then not make any revenue on those claims. It's important to note that claims at or below $750 make up only 7.1% of the potential savings that Multiplan identifies from surprise bill-related claims, and only 1.5 percent of the potential identified savings when adding non-surprise bill-related claims. This is another data point supporting the statement I just made that analysis suggests the impact to Multiplan when a federal surprise billing law could be less than expected. So, as you can see, only in a few select cases, that is, in a hybrid approach for claims under 750, does the claim run the potential risk of not being sent by the payer to Multiplan? Again, this is why we believe that the potential passing of a federal surprise billing law would have a fairly limited impact on Multiplan's business. Next slide, please. Lastly, let me share with you our analysis of what we have seen in the 30 states that have already enacted surprise billing laws. There are a few different approaches states take to mandate what should happen if that anesthesiologist that I just mentioned isn't in the health plans provider network or in multi-plans provider network or wasn't successfully negotiated. I've already explained the dispute resolution and hybrid approaches which are deployed in seven states and nine states respectively. Another five states use a payment standard or reference pricing to set prices for these services with no prescribed option for dispute resolution. And nine states prohibit surprise billing but leave it to the payers and providers to figure it out amongst themselves, which often results in a dispute resolution. There are now two major federal proposals making their way through the lawmaking process. Both are very similar to the dispute resolution and hybrid mechanisms used at the state level. The main difference between the state laws and the federal is that the federal will affect ERISA regulated plans. ERISA is the federal law that regulates self-insured employers. This is an important distinction because claim charges for self-insured payers account for approximately 78% of all claim charges that Multiplan processes. We operate in all these states, both before and after enactment of these laws, and as you can see on the chart on page nine, the 30 states represent a sizable 87% share of that potential savings identified for both self-insured and fully insured commercial customers. We analyzed the 18 states laws enacted after 2015 looking at fully insured potential savings identified on surprise bill related claims in the year prior and the year following enactment. Let me focus on the states with surprise billing laws that are similar to the two major federal proposals. First, the seven states that employ dispute resolution account for approximately 21% of our total potential savings for customers. In response to the law, multi-plan customers opted to no longer send surprise bill-related claims accounted for only 0.9 tenths of 1% of the pre-enacted potential identified savings from surprise bill claims in those states. Comparing pre-enactment to post-enactment, fully insured potential identified savings from surprise bills, we saw an overall decline of 13.3%. It's critical to note that virtually all of the decline had nothing to do with the surprise billing law enactments. Instead, it was almost entirely due to a payer customer, one of ours having lost a major employer as a customer in one of those states. A small remainder of decline likely came from the impacts of COVID in the last two quarters. Second, the nine states that employ a hybrid mechanism account for approximately 51% of the total identified savings from surprise bills. We lost approximately 3% of our surprise billing-ready claims as a direct result of the law, but the total amount of fully insured potential identified savings from surprise bills grew by over 33%. All told, the loss in surprise billing-ready claims following the enactment of state surprise billing laws came as a result of a small number of customers who made the decision to no longer send surprise billing claims to Multiplan for processing. That loss amounted to only 2.2 percent, 2.2 percent of our total potential identified savings on surprise bill-related claims in the year preceding the enactment of state surprise billing laws. Notably, in the two categories where proposed federal legislation might land, dispute resolution and the hybrid approach, the percentage drop was less than 1 percent, 0.9 tenths of a percent, and 2.7 percent respectively. This 1 to 3 percent range is certainly in the ballpark of what we noted on the prior slides. In full disclosure, this is not a perfect analysis. We don't always know at the claim level whether it is for fully insured or self-insured business or where the plan was underwritten, nor do we know whether the facility where services were rendered was in or out of network, which is important for non-ER services. We've made reasonable assumptions. The analysis shows that we grew identified potential savings from some surprise bill relending claims by 28 percent from the 12-month period before and the 12-month period after these 18 states enacted their surprise billing laws, even accounting for the known loss of 2.2 percent of that business as a direct result of the laws. Look, Multiplan has been in business for nearly 40 years. We have worked with many of our customers and especially the large payers for much of that time. We evolve as the market evolves. We didn't stand still as the states passed these surprise billing laws. We created new approaches to help our customers operationalize and comply with these laws. These actions account for much of the 28% growth in identified potential savings in these states with surprise billing laws. And of course, we continue to add new customers, improve the performance of our services, and add new services such as payment integrity. I'll close on this topic with one final point. Multiplan is in the business of reducing medical spend, and we do this through a variety of technologies and data-driven methodologies that administer claim repricing and settlement. That is at the core of what any federal surprise billing law would require. We are well ahead of the game in being prepared to help payers operationalize a federal bill which we believe is not likely to be enacted and operationalized until 2023 if the bill is passed in the near term. Next slide, please. Let me now hand things over to Dale for a business update. Dale will start off by telling you a bit about our business. He'll hit on three facts. First, we are a data analyst company in the large and growing $3.8 trillion U.S. healthcare system. Second, our customers are commercial healthcare payers. They will talk about our core and also about the adjacent customer base we will address in the future. And third, we provide a mission-critical service. We identify potential savings of more than $19 billion for all of our customers and over $106 billion of medical claims in 2019. In short and without question, without us, healthcare would be far less affordable. So let me now turn things over to Dale to address this in a bit more detail. Dale?

Good morning. Thank you, Mark. Good morning, everyone. Next slide, please. We'll start on slide 13. For those of you who haven't met me, I'm Dale White, President of the Payer Markets. Since Multiplan is new to the public markets, I would like to explain a bit about what Multiplan does and how it does it, and then explain how we are making our strategic vision a reality. As you know, we've laid out our growth strategy during Analyst Day and discussed how the three-part enhance, extend, and expand strategy will drive our growth in the coming quarters and years. Next slide, please. As Mark said, We are a data analytics company in healthcare. I know that some of you focus on technology and others focus on healthcare, so I will borrow Mark's tagline and tell you that Multiplan's core mission is to make healthcare more affordable. The U.S. healthcare system is a $3.8 trillion market, growing at around 5% per year. Over $1.2 trillion of this is estimated to be overcharging, unnecessary services, errors, potential fraud, waste, and abuse, or administrative friction costs. Our job at Multiplan is to reduce the end cost to our customers by identifying and advising them on how to reduce the cost of settling medical claims. We do this by leveraging our large network of 1.2 million providers with whom we have contracted rates as well as through our market-leading data and analytics that help set fair rates where we don't already have contracted rates in place. We also combat waste and abuse using our proprietary payment integrity technology, and through our highly automated processes, we reduce administrative costs for the system as a whole. Next slide, please. Our customers are for the most part commercial healthcare payers. I mentioned the $3.8 trillion healthcare market that includes Medicare, Medicaid, and commercial health coverage. Today, we focus primarily on the $1.3 trillion commercial market, and within that segment, primarily in the commercial out-of-network space, which is about 10% of that, we're about $130 billion of medical spend. We are the largest player in the commercial out-of-network space and work with payers offering both fully insured and self-insured business. We serve healthcare payers that account for at least 80% of all commercial covered lives in the U.S., and there is substantial room for growth within our current commercial customers to address their in-network spend and through selling new and existing services in adjacent markets. We highlight two adjacencies on page 14 of the presentation. First, for government, about 72% of government plan covered lives are administered by commercial payers with whom we have an existing commercial relationship. So we enter into those sales discussions as a known and trusted partner. And second, we have a lot of room to grow both in adjacent commercial segments like PPAs and regional health plans as well as property and casualty payers. In fact, the acquisition we recently announced will accelerate our penetration within the TPA and regional plan segments. Next slide, please. It is really important to understand how we work with our customers. Let's walk through a simple example. Let's imagine Jane, let's imagine Jack and his mother Jane, who live in New York, have driven to North Carolina for Jack to play in a tennis tournament. Jack develops severe elbow pain, so Jane schedules an appointment with a pediatric orthopedist, Dr. Smith, who is an out-of-network provider. Jane will have to pay a copayment, $50 in this example, and the doctor bills $1,000 to Jane's health insurer. Without Multiplan, Jane's health insurer, the payer, might try to negotiate a reduction of the bill, but more likely will apply the plan's usual and customary benefit rate of, say, $800. Jane owes her portion of the plan's coinsurance, which is 40% in our example, another $320 lesser copay. So Jane is out of pocket up to $520 because there was no network contract, And Dr. Smith has the right to bill her the difference between his $1,000 charge and the $800 paid by the payer and Jane. Both the payer and Dr. Smith had to pay administrative staff in order to negotiate and collect. So in this example, the $1,000 doctor bill actually cost the three parties a total of $1,200. Next slide, please. Now let's see how things are different with Multiplan. In this case, when Jane's Insurance Company receives the bill from Dr. Smith, the bill is electronically sent to Multiplan. Maybe Dr. Smith is one of over 1.2 million providers we contract with, and we apply our contracted rate. If not, we can use our proprietary data and algorithms to identify and either negotiate or advise the payer to pay an amount supported by our claims data and algorithms. Let's say we reduce the claim to $600 under a network contract. We send this new price to our customer, Jane's Health Insurer. The insurance company pays $360 of this to the doctor, and Jane pays $240 in coinsurance and copayment. We've just saved the insurer and Jane money, and the provider and payer both incur lower administrative expenses. So in this example, the $1,000 doctor bill actually cost the three parties a total of $700. We charged the healthcare payer a percentage of realized savings depending on their contract with us and how the claim was reduced. This is how we make money on the majority of our business. We get a small amount of the savings realized by our customers. Our incentives are completely aligned with theirs. In this case, we saved the payer, consumer, and provider $500 in medical and administrative costs, for which the payer paid $40 to multi-plan. Next slide, please. In total, our services identified potential savings of about $19 billion for our customers in 2019, up from $10 billion in 2014. You saw this before on Analyst Day. Out of the $100 billion plus in claim charges processed through Multiplan, roughly $45 billion presented a savings opportunity, and we identified potential savings equal to approximately 40% of these claims charges. Next slide, please. Let me switch gears now and talk about Multiplan's 3.0 Strategic Growth Plan. Next slide. Looking at the healthcare value chain today, we delivered value two critically important areas for our payer consumers. Multiplan is the leader in pricing and payment integrity, primarily for out-of-network claims. We intend to continue to drive initiatives to improve in these two areas. Having said that, we executed the merger with Churchill because we believe that there is a substantial need and room for us to grow to better serve our existing and new payer customers, as well as to provide solutions to providers and consumers who are the critically important constituents in the healthcare system. To that end, we have a clear vision of growth going forward in additional services for all payers, plus solutions for consumers and providers, moving both to the left and to the right of the value chain. The foundation for this growth is our data, our algorithms, our platform, and our provider network. We already connect to 1.2 million providers and the majority of healthcare payers. We do not need to build de novo operational infrastructure or intellectual property to execute the majority of our three-part growth strategy. Next slide, please. Our three-part growth strategy is designed to increase our targeted addressable market by approximately fivefold in the coming years. First, we are enhancing our existing solutions with advanced algorithms as well as adding product capabilities such as additional reference-based pricing services that will better serve our customers in the $6 to $8 billion existing TAM. Next, we are extending our offerings into adjacent payer segments that we either don't address or that are underpenetrated. This includes commercial in-network claims, government, and other adjacent segments like TPAs, regional health plans, dental, and property and casualty, adding another $4 to $5 billion to our TANF. And as we further expand into additional services for payer customers, as well as adding services for providers and consumers across the value chain to target an additional $24 to $37 billion in TANF. Next slide, please. Here you can see the projected revenues and adjusted EBITDA attributed to the three growth strategies which we presented on analyst day. Our acquisition of AHST announced on Tuesday contributes to both the enhance and extend strategies and will add an estimated $18 to $20 million in revenues in 2021. We will continue to aggressively execute on our growth strategy. Next slide, please. We also shared with you on Analyst Day the 15 priority initiatives that are driving the enhanced, extend, and expand strategies. Paul Gallant, our President of New Markets, is focused on the expand strategy, and together we have identified the initial KPIs that will help us to measure progress moving forward. I won't go into the detail on these now, but you can see here they measure things like success in integrating machine learning into our operations, which is one of the cornerstones of the enhanced strategy, growth in both new customers from adjacent markets and penetration of commercial in-network claims, which are at the heart of the extend strategy, and progress in deploying corporate development and M&A, which touches on all of our strategies. In future calls, you'll hear from both Paul and me as we report results against these key indicators. Next slide, please. And speaking of acquisitions, on Tuesday, we announced the first closed deal, and we have a number of very interesting opportunities in the pipeline. We are disciplined in our approach to acquisitions. looking at both tuck-ins like this one that are highly accreted and can be deployed quickly, as with Mars and MCN, which were subscale in revenue and had no EBITDA when we bought them. They now make up approximately 70 percent of Multiplan's business and drive 75 percent plus margins, and we expect similar growth with HST. We are also looking at medium, large, and even transformative acquisitions, especially in the extend and expand segments of our growth strategy. I'm very pleased about this new addition to Multiplan for a number of reasons, not the least of which is its projected growth, particularly when considering the relationships and scale that Multiplan can use to support and further accelerate that growth. HST is a reference-based pricing service, but it's not a traditional reference-based pricing company. It takes what has historically been an adversarial strategy, limited in its use to the small end of the commercial health market, and has repositioned it into a collaborative approach that we know has a significant appeal to health plans. HST delivers new services that can be deployed in the TPA market to deepen our penetration there, starting with the 44% of its TPA customers that don't work with Multiplant today. Today, the outlook for HST in 2021 is $18 to $20 million of revenue and $8 to $10 million in adjusted EBITDA. Because the 2021 outlook does not build in additional upside from multi-plan distribution or cross-selling, we are extra excited about the business. HST joins multi-plan with 2020 revenues projected at about $14 million. For us, it's a classic tuck-in acquisition poised to generate dramatic growth with the distribution and scale that Multiplan has proven can take the right product well beyond the space it occupies as a standalone business. Next slide, please. I'll now stop and pause and turn it over to Dave, who will talk about the financials.

Dave? Thank you, Dale. First, as Mark said earlier, we delivered a strong quarter. Our revenue growth grew to $223.5 million in Q3, up 8% versus last quarter and down only 9% versus Q3 2019. The year-over-year decline is due to COVID, which impacted us less in Q3 than in Q2, but did cause a drop in realized customer savings that drive a big part of our economics. Customers sent us over 1 million COVID-related claims, including many COVID tests at relatively low dollar amounts, and many of our payer customers chose not to have those tests negotiated down or negotiated and adjudicated at an amount higher than they might normally have adjudicated. That is the bulk of why revenues were down year over year. Our identified potential savings on the COVID-related tests were approximately 80%, but the realized fee based on payer's adjudication were approximately 20% below our normal levels. Now, it is important to say that our performance queue over queue and year over year that was better than we forecasted on Endless Day was not only driven by lower COVID impact, it was also driven by signing new customers and other initiatives associated with our three-part strategy. Next slide. We have all been affected by COVID. as well as the follow-on effects over the last several months. Here are three examples of how we've responded to this new environment. Even as claims went down dramatically in Q2, we have made continuous investments in further automating that small sliver of our claims process that is not 100% automated. As previously mentioned, we are also investing in machine learning and similar logarithms which strengthen the system, and we are ready when more charges come. We are deploying agile teams to capture the opportunities and address new markets. We are growing our offerings and sales force for government business as we expect some shift in membership to these lines of business in future quarters. We believe in through-cycle investing, and we continue to build new capabilities for the opportunities ahead. For example, we are fine-tuning our logarithms to identify cost-savings opportunities for telehealth claims that we see increasing significantly. We look at a lot of ways to understand the impact of COVID. We are worried that payers would lose customers, and they have, as businesses close. In contrast, we lost few accounts, all small, and our growth initiatives more than compensated for any lost revenue. Next slide. On this slide, we compare Q3 2020 budgeted revenues, Q3 2019 actual revenues, and Q3 2020 20 actual revenues. On analyst day, we thought the COVID impact would be $70 to $80 million in Q3 2020, and more than 90% of that normally falls through to adjusted EBITDA. This would have resulted in approximately $184 to $194 million of revenue in Q3, and even lower if you assume the $70 to $80 million was against last year's volume. Instead, the impact was only about half when we look at the bridge to Q2. ending up about $22 million below last year's Q3 revenues. I would like to emphasize that we may not provide this level of detail every quarter, but we recognize that times, especially with COVID, are unusual, and we believe you deserve to look at this data, but in the future, we may not necessarily provide these bridges in every call. Next slide. Here you see the absolute growth in each of our services. As you can see, the growth from Q2 was not concentrated in any one service line. Rather, all service lines grew, including network and payment integrity. This speaks to the robustness of the growth that we saw in Q3. Next slide, please. Our Q3 2020 adjusted EBITDA reached $165.5 million, up 10.5% from Q2, and our cash flow was $151.1 million, 14% better than Q2. We are proud of this healthy performance, given the challenging year of COVID that 2020 has been. In the appendix, you will see how this reconciles to our gap net loss, the biggest item in the net loss of $262 million – The biggest item in the net loss is $262 million of stock-based compensation, which is the increase in fair value of the B stock units from the 2016 to 2020 stock-based compensation plan based on the business combination with Churchill. Okay. It is not going to be that large next quarter. It will be about $106 million next quarter, as these were charges related to the merger. There will be no stock-based compensation charges related to this Class B plan after Q4 2020. Next slide. We processed a record $27.8 billion in charges in Q3, up 21% from last quarter. Identified potential savings for our customers increased, and we are delivering more value for our customers. For claims with identified potential savings, we continue to recommend potential savings of 40 to 45% of charges to our customers on average, as mentioned in the analyst day. The important thing to point out is that even though identified potential savings were flat year over year, we believe that customers chose not to recognize as much of the savings that were identified versus normal rates because they did not want to negotiate down the cost of COVID tests and perhaps certain COVID related procedures. Next slide, please. While it is common for people to calculate revenues as a percentage of identified savings, we want to reiterate that this metric can be misleading for two fundamental reasons. First, there are timing differences between these two numbers, as claims take time to adjudicate after we send the identified potential savings on claims to our customers, and we get paid on realized savings after claims have been adjudicated, not on identified potential savings. When claims grow rapidly, these differences can result in bigger variances. On this schedule, we adjust for that. Second, we need to adjust for some corrections and settlements as we sort some items out with our payers and providers where they provide us corrections. That's just normal course of business for us. Once we adjust for this, you can see that the pro forma revenues divided by the potential savings went up this quarter, not down, as you would think at first glance. In addition, as mentioned above earlier, the customer decides how much of the identified savings to take. It could even be zero in some cases if they believe that it is in the best interest in a given provider relationship or regulatory environment. As noted on the slide, revenues as a percentage of savings for COVID-related claims are 15% to 20% lower than normal experience. Throughout the crisis, we have seen the medical expense ratio of our customers decline, and we believe that payers are often not taking as much of the potential identified savings as we indicate to them. Another example is that we have seen very large influx of claims associated with COVID. They are lower dollar claims, and many payers have elected not to challenge their costs. Our payer contracts, as Mark and Dale have mentioned, are normally three to four years, and nothing has changed in those contracts in Q3. Next slide. As we look into Q4 2020, we are guiding to $238 to $253 million of revenue with $180 to $194 million of adjusted EBITDA. The adjusted EBITDA estimate includes the costs we expect to have as we hire for growth and incorporate all the estimated costs of being a public company. here that were not in our original budget for example we needed to increase our dno insurance our audit fees go up we have to be socks compliant by december 31st 2021 board fees and related expenses will increase and we will hire additional staff in key public company related staffing areas as mentioned by mark our current interest expense will decrease significantly due to the refinancing we should see a 12 million dollar reduction in q4 interest expense compared to q3 While there is, of course, uncertainty here, especially around the impact of a second COVID wave in the United States, we feel confident that these revenues and adjusted EBITDA guidance provided here will be achieved. Next slide, please. Here is how we think about forecasting in general and in 2021 in particular. I thought I would lay this out in our first call together to walk you through our thinking. First, we look at actual performance and momentum the best we can to get a normalized starting point. We then look at expectations at some healthcare trends, like healthcare cost inflation, maybe new procedures, therapies, et cetera. This would be a normalized baseline for 2021. We don't expect to see much there in 2021 again, but I just wanted to lay it out in our framework. This year, obviously, we overlaid COVID impacts, and we believe we will have to consider COVID-related assumptions in our 2021 budget. Lastly, we are adding the net impact of our new initiatives, both organic and inorganic. Next slide, please. We wanted to give you an update of how we were thinking about it. Obviously, there's a lot of uncertainty here, so I wouldn't really call it guidance. But on Analyst Day, we forecasted $1,085,000,000 to $1,125,000,000 in revenues and $845,000,000 to $870,000,000 in adjusted EBITDA for 2021. We have not adjusted this forecast and are currently in the process of developing our 2021 budgets. We expect to complete the 2021 budget in the next 60 days. We will provide 2021 guidance when we are comfortable with that budget. We believe that we will have approximately $77 million in capex, 24 to 28% tax rate, and $240 to $250 million in interest expense in 2021. I would like to briefly mention our capital allocation framework. We strongly believe that organic growth is the most value accretive. So to the extent that that needs capital, we fund it. Second in line is value accretive M&A. We are obviously thoughtful about this and don't do M&A just for M&A's sake. It has to be the right company at the right price to get over our return threshold. We have a goal target to maintain about 4 to 4.9 times net operating leverage and intend to deploy the cash needed to maintain that ratio. Our net leverage may vary over time. Lastly, at some point, we may return excess cash to shareholders in the form of stock buybacks. I will now turn it back over to Mark.

Thanks, Dale. Thanks, Dave. As you know, Multiplane has always had great leadership. We've enhanced that leadership team as we've gone public, including Paul Gallant, our new president of New Markets. I also want to tell you that we're actively building an investor relations function with dedicated executives to be responsive to investors and lenders going forward. This will give you all much more accessibility to and contact with us as we go forward. We're also planning a non-deal roadshow shortly. I look forward to speaking with all you again soon. With that, let's now open up the session to questions.

As a reminder, to ask a question, you will need to press star 1 on your telephone. To withdraw your question, press the pound or hash key. And please stand by while we compile the Q&A roster. Your first question comes from Josh Raskin from Nefron Research.

Hi, thanks. Good morning. Appreciate the extended call this morning, obviously very timely. Here with Eric Percher as well, we've got a couple of questions. I guess the first one would be overall revenues were down 9%, 9.1% year over year. Just simply, was United as a customer better or worse than the overall change?

Dave? I think it was actually slightly better. Let me double check that, Josh, while you ask your second question.

Gotcha. All right. Second question, just, you know, you've talked about a couple of times, you know, small customer losses, et cetera. Are any of those customers going to competitor offerings? And if you're losing them, what exactly are they doing?

Dale, you want to speak to the competition and customers? Yes.

Sure. Josh, I mean, the customers, you know, it really is a function of their cost management strategy. And I think as we said, it ebbs and flows. as the economy does. And in reality, their interest can be, you know, it can be aggressive or it can be in aggressive or generous health benefit approaches. And that ebbs and flows always with the economy. So if we do lose a small number of customers, they may be changing their strategy They may be, you know, using another type of service. They may be reorienting their strategies to include payment integrity. There's lots of reasons why the small customers move around. And we're excited about the addition of HST and the opportunity to work with them in the addition of the reference-based pricing program that it brings.

All right, which brings me actually to my next question. HST versus Navigard. Can you compare and contrast? I understand they're both in the reference pricing world, but it sounds like you believe HST is a little bit different.

Why don't you speak to the unique nature of the collegial approach to the marketplace for HST, and then we can do the comparison to what the Navigard offering really is about, which is largely focused on patient advocacy, if you will.

Yeah, I'll take the first part of that question. HST's approach, I mean, I think as I said in my remarks, Josh, you know, there are a number of reference-based pricing companies that have been around for a while, and many of them were adversarial in nature. And what excited us about HST was twofold. One was their collaborative approach with providers. They take a very, you know, very collaborative, very engaged approach with the provider community in the way they implement their strategies. And secondly is the work they do on the front end. the front end with the member and to assist the member not only on the front end as the member is seeking care, but they also have a patient advocacy center that they can utilize to engage with the member if any issues come up as the member is navigating their way through the delivery system. So from those two points, their collaborative approach is not adversarial. It fits nicely with our provider network strategy. and their engagement on the front end with the member and with the providers, what excited us about the HST model.

But just to follow up on the basic mechanics, I just want to make sure I get the basic mechanics right on that. So the basic mechanics are they're using a reference price to reprice claims, correct? And I'm assuming it's typically off of some sort of percentage of Medicare. Are those sort of the similarities of the approaches of those two companies?

Yes. Both have a reference-based pricing, oftentimes using Medicare as the reference point. And then they both have, both Navigard and HST have a consumer advocacy program that they try to mitigate the higher exposure that those members would have for out-of-pocket costs for both in-network, which would be the coinsurance and deductibles, and also for the out-of-network. of charges as well, at the same time, you know, address issues relative to, you know, abrasion or potential abrasion with providers and potential abrasion with subscribers. All right.

I'll ask one more and then maybe I'll jump in queue because I got a couple.

Your next question comes from Daniel Grosslight with Citi.

Hi, guys. Thanks for taking my questions and I appreciate all the color that you're giving on this call. It's very helpful. You know, one of the contentions of that short report is that basically your contracts are not enforceable. So can you go into more detail on what a typical contract entails and what's preventing someone like a United from using something like a Navigard while still being in contract with you, simply shipping claims to Navigard?

Look, our contracts with the large payers are multi-year. United has been under multi-year contracts with us since 1994, Cigna since 1992, Aetna since 1994, as an example. The contracts, you know, multi-year, they're automatically renewable, and when we sit down to renew the contract, typically changes is the scope of services we provide them. It's not an adversarial contract renewal process. They sit down, and with our team, they look at how together we can enhance the value by generating more savings through the solutions that we have, identifying egregious billing, or clinical aberrations to our payment integrity product. The basis of this contract is the continued value that we provide those payers for both their insured book of business, where they're taking the medical risk, and then for their self-insured business, where they provide an array of administrative services, one of which are the multi-plan, out-of-network solutions.

Got it. And can you just speak to the exclusivity built into those contracts and if there's kind of anything preventing a large payer from shifting claims to another similar service?

I think in almost every case, the added network business multi-plan is in that first position and receives almost all the added network claims. So we get first look at all the added network claims. Patient goes to the provider. provider sends that claim to the payer. The payer sees that that provider is in their network. If they're not in the customer's proprietary network, they electronically send that to Multiplan. We get first look on that. And as Dale, Dave, and I all mentioned, last year we received $106 billion in charges from those payer customers. We also tailor our solution set of networks negotiation, data eyesight to meet the goals and objectives of that payer to maximize savings. Obviously, the more savings we can generate for the payer, the more revenue we can generate for Multiplan. And we have a high persistency rate to generate significant savings, as we referenced, over $19 billion on over $100 billion in charges received last year.

Got it. Okay. And then just going to your example of Jane and Jack here. You know, if Dr. Smith is not contracted with Smithland, so you're using your ISA with Dr. Smith, what's stopping him from going to Jane and balance billing for that $400 that you saved? Is there anything... that prevents balance billing when iSight is in use.

Dale, I think it would be useful, why don't we take a step, in the spirit of education here, why don't we just take a moment and explain to the group how data iSight works and the experience we've had using it since 2011, and we have a very low appeal rate because it's not a black box, it's analytically driven, and there's a methodology that may walk that through the provider, we have an appeal rate that is middle single digits. Why don't we talk about the mechanics of how Data EyeSight actually works?

Sure. As Mark said pretty well, Data EyeSight is a methodology that establishes a grade of reimbursement for the provider. It does that either using a cost-based driven methodology, meaning it uses the Medicare cost reports and other publicly available data to establish a reasonable using the cost as opposed to charge to establish a methodology. And it compares like facilities and like claims, meaning it takes into account severity of illness or injury. And it adjusts for wages, so it takes into account the difference in geography and it arrives at a rate of reimbursement for the facility. And it's designed, as Mark said, it's very transparent with the provider. There's a portal which the provider can access to better understand how the claim was reimbursed. And as Mark said, our appeal rate is very low, but we have a team of individuals that if the provider raises their hand or has any questions about how the claim was reimbursed, the methodology behind the claim, and either a physician or a facility claimant, then we have a team of advocates that engage with that provider to educate the provider, help the provider understand the methodology, help the provider understand the reimbursement, and enter into discussions with the provider if they have any questions around the rate of reimbursement. And as Mark said, our appeal rate with the providers have been, for the most part, very low.

Yes, supplemental to that, When you look at our network, the 1.2 million providers under contract, then you look at our analytical negotiation services, all of those claims by contract, by agreement, there is no balanced billing and the member is held harmless from any surprise billing. And we've seen over time that out-of-network providers often, after some experience with Multiplan, either, you know, for the negotiation analytical service or data eyesight will become a network provider for all the benefits the provider gets from being a network member within Multiplan. But the network needs to grow, you know, year over year. There's now 1.2 million providers in a national system.

Yes, that makes sense. I guess you have any data around what percent of members um, are, are kind of stuck with the surprise still, um, of those, um, claims that, you know, where you don't have a contract and are just purely, uh, relying on eyesight.

Historically, the appeal rate has been in the four to 5% range, uh, going back to 2000, 2011. And, and the overwhelming majority of those cases, the, um, the negotiation results in a settlement and the member is protected and the provider gets a timely, accurate payment.

Okay, got it. And then just one last one and I'll hop back here in the queue. On the surprise billing, I thought that breakdown of your revenue was extremely helpful here. I guess as we look at the around 11.4% of of the bills that are either settled using your network or through your negotiated process. What's the risk here that a surprise bill, federal legislation, really just obviates some of the need for your complementary network? your plans will just say, no, we'll just rely on this benchmark or whatever it will be, and we won't rely as much on multi-transforms network.

Well, you know, I'm not prescient enough to know what will come out of Washington, D.C. I think, as we said in the presentation, I think we have those two models, but I look at the years of experience we've had operating in those 30 states, and based on that, it's had an immaterial impact on our business, and that our network business, our complementary network business, our negotiation services have continued to flourish and grow. So I make the conclusion that it'll be a similar experience at a federal level. with the self-insured ERISA plans.

Got it. All right, guys. Thank you.

Your next question comes from Rishi Parikh from Barclays.

Morning, Ann. Thank you for taking my questions, and also thank you for all the details that you provided. I wanted to clarify one item. On UNH's YouTube video on Naviguard, they talk about the price-enabling strategies and savings on billed charges. It seems as if they have some type of analytical platform. Now, I get it. It may not be that robust, and I agree with you that your platform is a lot broader, and I also agree that you're not going to lose 100% of the UNH business. But given their platform and assuming that they're active and considering UNH's public comments that they're indexing, out-of-network claims to Medicare, do you expect to see certain types of UNH claims, such as ED claims or lab claims, shifting over to Naviguard? And even if it does, will you still have a role in these claims?

Dale, why don't you comment on the way that Multiplan is used by United across all their book of business? Because in Naviguard, Naviguard, quite honestly, is another product offering that United brings to the marketplace. And one of the embedded or included in Naviguard offering is our payment integrity product because we have a robust, very effective, prospective payment integrity product, which I believe is the gold standard and best in class. We view Naviguard as a reference-based pricing product that United offers will bring to a certain segment of their marketplace. But United uses all our solutions to enhance their offering, lower their medical costs, lower their administrative costs, and improve their go-to-market strategies. Dale, can you supplement that?

No, I think you're right, Mark. I mean, it is clearly one of the several programs that United Healthcare offers. And, you know, it really gets down to the choice of the employer to adopt a reference-based pricing program depends on a number of strategies and their objectives and their health plan and, you know, and how they want to go about minimizing plan costs and costs. As Mark said, United uses an array of services from MultiPlan, depending on that configuration, their needs and their clients' needs.

Look, United is a market leader. It has a very diverse customer base, and that calls for offering a variety of health plan options to the employers, and the employers often offer multiple benefit plans. And I see Naviguard as one of the plans that United Healthcare will offer their self-insured ASO customers. And just like we've been doing since the early 90s, we provide value-added services, and they will take us along because we can improve the performance of that product. It's very analogous to, you know, when United readies a product to go on the ACA exchange market, the exchange business, that's another product offering to that segment of the population. They'll access multi-plan services as well to produce better medical cost management in terms of egregious and excessive billing and at the same time identify clinical aberrations that are inherent in some of the care that's being delivered to them.

And with that, can you just maybe provide us an idea or quantify the number of lives that have actually migrated over to reference-based pricing and what your expectations are for 21 versus 20?

I don't believe we have that data at hand to respond to that.

But I do think – excuse me. I do think it bears repeating, and the guys have said this a bunch of times here. Our business has grown with United. Our business will continue to grow with United quarter after quarter. And so how many lives have migrated to United? NaviGuard, it's a reasonable question. It's certainly not impacting our business.

I think to follow up on Josh's earlier question, the United growth from Q2 to Q3 is greater than the 8% growth of the entire company from Q2 to Q3. So United continues to grow and be a bigger part of our business.

Great. And if I could just ask one more question. You know, in the past you've talked about with that you have this, I guess you could call it a revenue sharing agreement with your payers or your customers, and that UNH makes money on your services other than the cost saves, and that creates some stickiness with these customers. I was hoping that if you could just quantify what this amount is with UNH or in total with all your payers, so we could better understand that stickiness. I mean, is it $50 million, is it $100 million, is it $200 million, $300 million?

I can't tell you the – I can't answer that question. I truly don't know.

Thank you for your – I'll hop back in. Thanks.

Your next question comes from Andrew Kugler with Goldman Sachs.

Hey, guys. Thank you for taking my questions here. So first, just two on my end. First, historically, claims repricing has been outsourced to third-party vendors such as yourself. Can you maybe just talk more broadly about the market and why this is the case and hasn't previously been insourced? Are there any sort of regulations or any kind of ERISA legislation that prevents this? And does it sort of matter if the repricing amount is based on a negotiation or a non-standard reference price like Cost Plus, which is what you guys do, compared to maybe a more standard reference price, such as a multiple of Medicare, like Navigard seems to do, or percent of bill charge? like has historically been the added network repricing amount in the past? And do you see the market shifting anytime soon to insourcing versus outsourcing?

Look, our customers view us as a partner. They outsource the repricing of our network claims because we have a market data advantage We have an incomparable database across 700 plus payer customers. We're highly automated, we're highly efficient, and we can reprice those out-of-network claims in a very timely, accurate manner. It makes it much more cost-effective for them to use us than to internalize those services. We have impressive size and scale. We have a differentiated data advantage. have incredible speed and accuracy and persistency in those claims. And for nearly 30, 40 years, those payers have recognized that value, and that's why they continue to do business with us, and our business has continued to grow year over year.

Let me just add something, Mark, if I may. When we were doing diligence on the company, the thing that we were most impressed by is the fact that they're drawing their data from claims of 700 payers it's not a single payer database it is claims from 700 payers it is very very different than what any single payer can do on their own which is why they all come to multi-plan because we provide that independent third-party gold standard There are many, many products that are in the market today, and they have been forever, whether it's reference-based pricing or consumer advocacy. I think what might be getting lost a little bit in the translation is that, you know, we're talking about apples and oranges here. Solutions like, you guys keep mentioning Navigart, solutions like Navigart, they're consumer-facing. You can go on the website and see it's a nice product, but it's a consumer-facing product that helps consumers to negotiate doctor bills. And it's done on a one-by-one basis. It's fundamentally different than what we do. We're an enterprise solution. We process 360,000 claims a day, seven days a week, 365 days a year. So we support and we are very much in favor of products like Navigard because they help consumers. And one of our strategies in Xpand you may know, is for us to start to provide servicings to providers and consumers in addition to payers. So this is all quite consistent. But the notion that this is taking business away from us or that, you know, this is going to be in direct competition with us or that, you know, United is stopping its flow of claims to us, they're just factually inaccurate.

We would now like to turn the conference back over to Mr. Mark Tabak.

Mark Tabak Thank you very much. I'd like to leave you with a couple of thoughts, Mae. Multiplan for decades has enjoyed a market leading position with impressive scale and a market differentiated data advantage. The mission critical nature of our product really has created a competitive moat around our company and drives high recurring revenues. And the attractive financial we have produces strong cash conversion and best-in-class margins. As I said before, we'll be doing a non-deal roadshow in the coming weeks, and we look forward to speaking with you all again. Thank you for your support.

Ladies and gentlemen this concludes today's conference call. Thank you so much for participating. You may now disconnect.