OSH - Earnings call transcript Q4 2021

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Operator

Hello, and welcome to the Oak Street Health Fourth Quarter 2021 Earnings Conference Call. My name is Alex. I'll be coordinating the call today. [Operator Instructions] I will now hand over to your host, Sarah Cluck, Head of Investor Relations. Over to you, Sarah.

Sarah Cluck

you us thank and morning, for today. joining Good Pykosz, Officer, and me today, Cook, Executive Mike are Officer. With Tim Chief Chief Financial advised materials Oak are Street call conference on the the press that website. section recorded, available webcast be of Relations release other-related that Health Oak is and link, Health's Investor and Street Please being today's assumptions. time Today's risks, view and management's statements and XXXX, reflect various made are to at as and this of uncertainties, subject of and March Xst are expectations forward-looking contains call This statements. related statements past is not That to events. future, this business context, target, should, continue, plan, words anticipate, forward-looking expected In may, statements often project, contemplate, performance such will, our address and believe, could, future intend, predict, contain estimate, would, expect, and or often potential, expressions. as similar

nature, uncertain. matters different address to their are degrees that statements Forward-looking by

use particular profitability, customers number in substitute statements, our performance materially expectation superior to these cause results non-GAAP a non-GAAP our Commission, For that measures. revenue, our to reliance statements. accordance to forward-looking maintain Securities Exchange and year actual limited substantial our XXst, These GAAP. could XXXX, factors company's on materially prepared December to, expressed our actual and of achieve of different those us, ended There filed differ to of for to uncertainties and a could or you portion Please financial than of customers. the ability a financial include our be a measures financial market. and not non-GAAP to the our competitors growth, and number in well cause includes management XX-K annual estimate the to financial related call the addition ability as to from competition, refer with Form market, for of by limitations measures of increase of our these that opportunity, will retain results target number innovations our discussion new with our existing of future our the report our are in the of on our This as ability market in effects of And to size our measures. see increased existing customers where or a are,

other example, of release measures. the reconciliation for our the financial GAAP to measures call earnings differently. turn similarly Refer of companies Pykosz. Mike? titled For may most appendix directly non-GAAP our to these measures I'll a the With financial non-GAAP calculate over CEO, Mike to that, comparable

Michael Pykosz

you, joining Thank And morning. us Sarah. for everyone, thank you, this

review the call, call, our on to and Cook, start year with focus Sarah, thank financial on I our the more for then in a share XXXX patients, around Joining XXXX. more XXXX Tim performance our and then it QX Tim to XXXX Chief turn the on dedication of I'll I'll to me year, for of Tim specifics In full discuss guidance and for team turn and performance. goals our provide mission. our We'll Officer. first to addition to want our continued will our communities, this today's Financial over and

new adds centers the XXX fourth revenue driven near the including finished Omicron had in quarter. existing including surge healthcare. all opened the tight results Our growth by the in market, new XXXX. patient for performance team We labor COVID we across and especially strong drivers headwinds, of We environment, strong a these challenging new both the centers. through continues centers, and navigate achieved operating major to in historically XX Despite

guidance early our in the and quarter, we quarter a with all the end quarter, representing in going revenue of well. costs, into of membership, compared Direct and million to were against range in-line fourth medical headwinds as $XXX.X in-line in were the with November. range quarter, a our -driven corporate and cover were net exceeding top which exceeded more cost not expectations gave we'll end which high record in The factored hospitalizations, XXXX. generated care EBITDA. from guidance QX significant expectations despite is of Omicron we detail, XX% obviously growth result in Third-party a costs revenue, which the adjusted In we of the guidance the

$X.XX For revenue, the year, compared we generated representing billion XX% growth in to XXXX.

new the EBITDA year exceeded targets at growth third-party our higher and in trended includes by continues channels, patient XXXX central whole. This these big markets and To as accomplishments marketing rebuild in combined can community-based team. trends, our the running revenue our states. with $XXX.X lead look our channels. financial cost with we model centers. more mitigate we beyond our scaled of our back a opened marketing additional Omnicom of the favorable care the to resulted to surges, impact To the which fill well a the both COVID driven XXXX believe costs have as help core concert. continuous than detail and for by experience end in care, expansion all in put headwinds AARP us Delta to channels for marketing to partner, adjusted marketing following care leading primary higher-than-projected in We the results directly will up it first new guidance. as greatly growth made cover health model strong of allow to performance. adjusted This by the to pandemic, costs revenue our BXC and put and Our growth step patient in investing that communities, in profitability to mission seven continue markedly when we and financial our years exclusive increases increased year, took we lead a marketing the This be. We're we for care across our XX lower sales community-based indirectly how our components and to marketing, from come. our XX revenue loss will center excited driven gap and it be central community QX we see guidance shared progress expectations, We existing patients, is anticipated metrics, as top across [Indiscernible] both future business. serve patient medical the across the to improvement Tim growth were of relationship as in the our corporate being in embedded will us digital the We working are in patients to forward both central time organic million help such to in approach. have drive retention, channels years in in and our growth, We should outreach our When context, a differentiator XXXX QX. that community with EBITDA reflected and while business. in line expected into impact our line eight significant greater took will centers key and on costs, XXXX performance. This which in will

lower we costs. to improve and services our and platform, adding care to medical on believe Additionally, outcomes health which build core for we new continue continue patients, third-party will model capabilities

better such of For technology our example, as to stratify impact and to learning our we the algorithms enhancements results implementing patients. platform, published new machine from data

in accomplished lower allow while navigating delivered costs, labor creating resulting and our spike innovative in the improve XXX,XXX year We COVID to markets. medical quality, doses. specialty We accomplished the aspects expect see vaccine virtual clinics and I twists tight operated early be executing We and RubiconMD the of We in our members, model, the what patient of accomplished all us heard XXX providers network plus care, a couldn't year will care thousands including of prouder in turns above surges half integrate vaccine of differentiated still to XXXX. care excited improved unnecessary of and navigated their in of experience. I'm all acquisition business. our XXXX, while approach We historically of team what team and specialty XXXX. into the it's second and they've

of direct like disclosed inquiry quickly. Before have recent program. Justice in from to I I'd CMS the contracting we announcements that November the over I turn to topics address The Tim, recent to Department related two and

On we response the DOJ to that inquiry. the and documents begun provide to continue have in will inquiry, status of

date with the among inquiry. the discussions of document the the collection and as request largely been substance process, the of scope Our DOJ about the to not and

such, we matter. unable about any currently predictions are this make As the to meaningful outcome in timeline or

previously, collaborative typically patients with and the said we DOJ provided program, we our direct Medicare enabled with that as care recently patients. to increased have Medicare we manner we services direct have primary inquiry. that manner, address transparent supporting are Oak As to announced and On will a traditional compliant their changes in for with a the participants program care the to work in contacting Street traditional and provide in to contracting we in strive the model operate

XXXX, protecting promoting beneficiaries In ACO communities, changes for aimed been to by patients XXX% also and believe The week, Oak governance, the more Last longstanding appreciate I'll serve invested areas as years direct located details We pending. to in given We'll and ultimate expect Oak the over Oak program. in HSS we a transparency. in what's our program some mental effort stakeholder to of communities Program designated our model, program XXXX. health details and model were take But and the financial fact, in participant to and Street. last we excited in joining [Indiscernible] spending, for on changes Medicare material monitoring, modify to health fit we cover to communicate care still both. not participant equity. performance with the CMI announced benefits accountable unreserved in in more leadership Shared and the Tim provider participate the the shortage several direct of health Savings at the medically both focus into bringing account are prior CMI CMS unreserved it Street changes well With are and of the Having ACO equity contracting, regarding areas turn with concerns. provided CMI do exact consistent important that, to contracting CMS Street's these advancing the week, to program health are the to if with impact time with

Timothy Cook

everyone. and you, Mike Thank good morning,

of by the year, generating we To high provided our the quarter XXXX a end third our in growth exceeded the $X Street We of continue the of billion eclipsed guidance XXXX call. resenting initial in billion from in generate XXXX. issued revenue in revenue, than guidance We A to XXXX X% growth $X.XXX in revenue during XX% XXXX. better strong end and revenue March XXXX. Oak for high recap platform

favorable our $XX high savings and guidance Total in for growth period rates. results of our growth above the the million years, capitated a XXXX, driven majority patient on ahead risk was capitated billion high XXXX at-risk revenue by more of at-risk XXX,XXX related year our eight the cared XX% $X.X Capitated represents Other QX $XX approximately centers performance the of we by arrangements. our period total of retroactivity. which our was developments As initial XXst, than we the The revenue million, of related under prior full of This ACO. patients from of And in our X% revenue XXXX of of Acorn increases our on prior our million XXXX, year accruals. represented primarily to December an the and of initial year-over-year, to range shared $XX.X of to call, payments increasing XXXX end end year-over-year. end guidance high from opened new representing compared by December our was as our our basis, prior of result center XXX centers for the adjustment was to related guidance XXst. Approximately the in range. $X.XXX to XX% count patients’ year our of driven for development XXXX favorable million base XX

by medical Total XX% growth to by from development patient and revenue Our prior cost medical in primarily the costs the to per in XXXX, the unfavorable was medical Capitated patients was XXXX claims The under retroactivity. XXXX $X.X driven increase in arrangements years, patient. of $X.XXX related of compared driven offset billion, primarily these development. capitated representing majority approximately expense period million directly prior-period costs increase prior by by were

not previously when a Oak retroactivity managed prior our or As occurs Street previously rosters, recognized for and health typical patient in plans medical in retroactivity but in revenue reminder, claims not therefore patients expense. pay periods, is included and

XXXX. During an our calls, direct we temporary medical the But earnings in areas headwind they highlighted our are results drivers nature. represented and These largely estimated last million pandemic two we of in costs. $XXX believe continue elevated three of to

first QX December. year, call, surge were first in $XX costs COVID admissions. we including million approximately estimate We from approximately in three of estimate $XX earnings Street related variant The an that of XXXX, cases related COVID admissions. shared to COVID In in to the COVID experienced full-year our the Omicron the Oak in cost quarters directly the costs for million

January February costs from ensuring remain COVID shots. and have admissions received well. have and as on We expect booster elevated are XXXX focused our to patients vaccinated their We

have will outcomes We available, place these be in effective our in future We access in also patients therapies programs to antivirals. new they ensure hope and have waves COVID patients. reducing oral poor other as for more to our become hospitalizations

nonacute was our including vaccinated, utilization. QX call, partially in standards roll during decrease and and hospital relaxed In March call, out spring driven specialist behavior. shared earnings visits, comfort to costs nonacute was compared into costs April specialist payer we to following health spring increased QX by they that utilization, for we accessing adults procedures, historical believe in to outpatient discussed public In our experience. summer. that patients’ these our and medical the the We The the emergency, due were the second older in care increased system vaccine late increase earnings in and the diagnostics, began once element

in with large estimate Comparing $XX the in year historical spring. elevated headwind driven continued. the progressed, our nonacute by trend the XXXX, utilization in experience, As part this million to we costs a

levels, lower where as we be However, run a feel the a new acquisition level lower elevated greatest Earnings headwind economics. our were new compared category significant per it we impact. new year. given medical both patient basis patients XXXX trend. the driven received what discussed exiting costs XXXX what result for the was decline economics RubiconMD on combination XXXX, Call, and contribution historical an we revenue expect do in patient QX by is This a is of to In and The patient we patient than have less final was to while experienced revenue for our considering economics. not the have lower in new when of would expected in we compared what than for to XXXX of the million higher estimate We we patient rate premium than The new costs a patients driver new patient significantly net also patients our to will new historically. cost have $XX less declined absolute

cuts at by the similar marketing tenure, center looked across And channel. all have geography, We saw and vintage, a provider new patient of decrease we data. contribution

economics XXXX. primary impacted not For medical centers in believe patient continue XXXX conditions health revenue communities, the new new lower economics medical system new engagement but is of lower because care both unaddressed costs markets, engagement adult or by conditions lower-income -- do this these patient negatively because the and believe those in were instead adults, to the we Lower go in in undocumented. especially higher of older reason, of lower by driver results

disease As burden. a reducing depend lag risk during score, scores diagnosis also a likely reminder, of risk Street provider joining effect on Thus, double year while Oak before the the had and lack increasing by a of visits. incoming engagement captured

set medical XXXX the expect which for on be believe discussed our in As in offset revenue per therefore early contribution [Indiscernible] costs from patient this these At to medical higher experience, in prior have too joined for historical larger increase XXXX, will we will XXXX. like patients what patients we XXXX, patient and view new our and revenue, the calls, we who it firm a patients. largely costs, look than in on patients two point in these is

subside costs to higher believe While over will these begin time year, pandemic to the and evolves and higher remainder than three profitability therefore these from to to as led than expected expense into we subside medical we continue anticipated seeing COVID claims lower are coming drivers that the endemic.

in $XXX Cost headcount, of in occupancy The A XX% during well as drive from increase medical well headcount as these and advertising in $XX depreciation of was cost driven excluding and to as related greater expense centers to costs. million salaries onto a XX% significant increase our $XXX and representing as amortization and increased million. well patient in growth. million Moving the million costs of benefits and in higher growth our related marketing care by an and and patient our salaries the clinics, to growth growth supplies, driven benefits XXXX of increase care. we transportation number a an centers, costs year-over-year at as base the new spend as of by was operate. expense was patients Sales year-over-year to year, increase $XX existing

XXXX, growth an were costs artificially was was Stock-based of and driven reminder, XXXX compensation administrative included activities Corporate, our a support the in As in headcount costs general total and and initiatives. or $XXX represented of the administrative temporary corporate marketing QX the continued year-over-year expense of outreach million million which the primarily of growth expense partially to due during necessary pandemic, million a by QX increase year-over-year, year-over-year XX% marketing and sales and depressed business. suspension inflated and as of in million $XXX $XXX XXXX, other general, to the of community a growth. costs $XX

total expense Excluding stock-based grew XX%. revenue and XX% our compensation, administrative to compared general, of corporate, growth

will our claims we now financial expense, year-over-year useful vast related metrics $XXX our IPO to as find capitated in expense grew we issued to highlight contribution, accounting Patient that is XX% evaluating which define medical less awards financial prior revenue performance. of three equity in non-GAAP I compensation stock-based million. reminder, majority a of to treatment As the our XXXX. the

decrease Oak expect define platform. excluding and million, care, which of economics This depreciation total We longer per a we decrease the are presentation million. as that are part our claims the base. expense provided year-over-year the these patients as JPMorgan Platform our recent $XX.X previously time. at-risk well which we for in and centers ramps centers therefore, in center patient to of expect the as losses was increase data less $XX.X our by And our cost the new of as contribution, in performance The growth expense, some year-over-year improve their over discussed medical portion immature. amortization to reflected medical of Street was claim significant during driven revenue XX% we from

expect We generate first new centers years. operating to loss two an the for

amortization three two of year operation approximately have by years. years. three than have in of which opened for As less opened XX% of December than approximately for and depreciation XX% XXst, been and our less approximately centers we Adjusted as breakeven been adding transaction calculate million EBITDA, loss strong costs. was and unit-based Income loss income million offering compensation, loss a liquidity position. balance of net other and sheet taxes, year related in in finished or of $XX.X XXXX. And to compared but XXXX the to with a a We stock excluding $XXX.X

XXst, we million our was was purchase cash, securities $XXX The of price debt and in and in We cash, closed QX, As of acquisition in December restricted a RubiconMD. million $XXX paid approximately cash. held marketable base

Our center-based will de liquidity continued initiatives, novo primarily expansion. support our our growth position

Mike it a back to discuss activities cash XXXX, million. capital $XXX.X our to focus our I'll by were expenditures now for turn XXst, was operating while December ended year the For areas million used XXXX. $XX.X

Michael Pykosz

Tim. Thanks,

excited older to our transform care to to on we're XXXX, journey adults. for Turning continue

four of the X) our care X) served, best experience, the patient X) X) unmatched be objectives will patients work and provide Our health the focus on grow XXXX communities number of anywhere, place an for Street: and best to Oak care. in deliver core be

we Telehealth For in to morphed zero our teams, am up the teams patients years, to QX offices for result vaccines and our We to efforts core of of huge acquired essentially equitable communities. many of neighborhoods I do ramped in from XXXX, advancing meet a older needs incredibly flexibility dozens in we to our across a have all and access XX% scalability order nimbleness focusing excited focus performance we our there teams serve. our In centers, on going of be last and clinics our amount to and our will the believe virtual. more our in XXXX, to company corporate the our we from communities. ensure our of near of both two to across into this time, at what and we've business objectives. adults continual patients we're a of for from proud XXXX, our for a of our these In vaccine QX being and improvement locations model.

platform drive January expect our in shared Conference to Healthcare center in XXXX. economic we JPMorgan Oak we As -- performance during strong presentation, the Street

subsets that to our that center approximately of up adverse patients $X get will six expectation highly is driving million are over these old be years Our continue of with contribution more each. centers profitable or XXXX

of improving detail mature they share will the Additionally, centers And of better newest than drives as KPIs in the maturation. our centers similar we financially centers our stronger we're investors our while in from return centers minutes. this in for Tim point to key starting a of reasons for and vintage more the our on patients. results. in the is our generate that showed that couple our these the in of off mature are thousands than at intermediate unit It confident to conference, ramping economics will well-being

from decade. We in mitigating of while and a near-term unchanged all we that delivers risks for value at our confidence view creation market unit pursue next the our strategy basis that longer-term the sustained differentiation over opportunity believe and current volatility. our remained model, center enable economics, we Our meaningful for as Because our level guidance. performance market conference a XXXX the growth massive that shared of will and can the stakeholder of

XX of in target new center new our updating are centers We XXXX.

we XX year growth revenue new achieve in next profitability per years. expected of substantial over Basically, through growth few XXXX. centers the XX compounded to will recent with XX per an new year [Indiscernible] of XX% By before XXXX. over average rate [Indiscernible] growth will Our centers or

grow Additionally, assuming XXXX, more January. our the substantial shared open $X.X unit open and for we than by centers in continue with billion dollars a EBITDA both to of EBITDA embedded centers by billion economics already XXXX, year-end over [Indiscernible] embedded year-end for

we previously considerable indicated, of growth. As years. needed cadence our consumption have improve we to our next capital economics, capital the have of center we're unit If couple new of control lowering over further able the through

We will reinvest that positive capital into capital an this the have accelerated pace now in we of fund growth growth, center sufficient equity capital openings, cash-flow by businesses the way, the to [Indiscernible] future. our in center or new center raise that believe need until without to we

think for market recent build any our market our shareholders. risk the prudent own Given Mitigate is the volatility for volatility, to path control most we destiny. and this value

revenue believe [Indiscernible] with As openings rebuild to profitability. confident care more us our better should We of economics approach turn growth continue range and XXXX. Tim it execute we guidance excited to and this new unit noted above, over to to considered. mission build organization remain we've even allows to in detailed health to discuss transformative annual center sustained in our for We to remain fast-growing, ability be. XX%, I'll across our and significant the compounded team's value-creating, execute

Timothy Cook

Mike. Thanks,

centers. XXX setting are we discussed, XX year-end resulting just Mike our initial guidance for center centers, of center our a up in growth As count the

to to for the approximately total generate care in revenue a representing to $X.XXX a XXX,XXX to over in year the a range billion, patients expect range for of XXXX. XX% of of growth a at-risk $X.X We XXX,XXX billion

we our contribution conference guidance within as platform the loss EBITDA $XXX is adjusted our that each for direct in around to loss be from range account EBITDA to COVID JPMorgan unknowns well JPMorgan the hospitalizations our $XXX expected costs Implicit new as into We performance adjusted million patient future that range range economics. Recall in took million. vintage. outlined

given opened relatively the there patient the Omicron will will the realities due the XXXX, at largely point COVID we Note centers a be had not given in fewer in new that same year. of as unknown we this we centers. leverage economics few are that QX, have generate of in Our costs, them present, operating and level surge the particularly guidance would to incorporates at XX

to performance. continue invest in platform We will drive to our future

our XXXX openings, to related new open open incur We delayed in costs XXXX. scheduled one-time will to expect centers manage now centers guidance our XXXX we originally but that potential to dead included from minimize do will to costs in

from our XX%. this XXXX As while positive future to an the in result us we look our and potential to strategically revenue XXXX XX for we burn, excess each in XXXX XXXX XXXX, years. and the pace losses of business, open XX of to raise. performance we the XXXX, position forward these and being to grow adjusted trop CAGR would pace, while cash EBITDA minimizing through of continue centers this will the With guidance, expect adjusted equity At EBITDA consistent in will to a XXXX, generating with a

XXst; first as to patients of quarter in XXX that, with and XXXX, the million a range centers total call expect we adjusted in the $XX of of now an we $XXX in following: March XXX,XXX million. to questions. of will $XXX of And the the to range at-risk a loss million; EBITDA For XXX,XXX $XX range the total million XXX; Operator? to open revenue the of to

Operator

you. Thank

Q&A. you. with proceed We Thank the will Instructions] [Operator now

of comes first Our question Gill now JPMorgan. for Lisa your from open. Lisa, is line today

Lisa Gill

you much. Tim. all and the very thank And Thanks details Mike for

or back ensued seven to weeks, changed go What capital where in the has centers markets you're thinking conference just growth about opening. wining XX talked in our and to is additional back to going last the way about you for to equity it not gain tap to simply eight Just truly something XXXX. the the else center markets current

Michael Pykosz

as question. changes, noted for in center Thanks ramps an conference seven guidance. our opportunity shared market we has of operational that basis range the for the ago, weeks view Tim standpoint nothing the From the our that remains

actually see we some next change us. centers of driven somewhat growth for think think like I we is grab. size opportunity. the and a out was land the ways, beyond. there a We huge in over feel thought decade be don't We this market I putting up market In that that opportunity still by center will

can so kind for and We the equity control at strong really access felt right growth, discussed, we that And a markets. to need level the and want to where as we in that bringing position want with approach combination looked we like of we an up the capital when growth, profitability really to in achieve, this to the the future. their we destiny the market of given own us to make didn't volatility, sure we the had and equity in markets remove volatility felt the raise very timeline the capital be

Lisa Gill

Very just helpful. quick then follow-up. a And Mike,

that of are direct CMS out are doctors. that's cohort how kind I There two adjustments maybe looking that patients rushed about with. your came But new the I are can issue of you don't the we then at. across suggest governance, that and feel just think employ areas really on. you the for risk people since you contracting an that You focused One secondly, think

Michael Pykosz

or be Street think that one organization, think the are the are. one, that Yes, we of what are that relevant we government's I same will on more contractual so for read doctors Oak have the we organizations rules more on a I that's provider governance versus where aggregators

the pay change shouldn't is released. and close We do read initial adjustment, that be But our think attention pretty as Street. so one's risk always we'll this is straightforward or devil the are Oak more So impact on detail, for us. big details in a more

since Medicare the Street, time very one we of of insurance of care we make haven't thing the the and Oak think of is onset that patients of based been the traditional investment care and our over type. And taking we're in unique proud company. period, don't the think we've that's -- I about on I patients quality differentiated we

was well. for baseline so 'XX, program, that population 'XX, similar. Oak direct in cared was And patient our care that's type contracting before received at 'XX, of Street all very 'XX, time directly patient population by the 'XX, that a XXXX, as a patients was And

limited initial you're Obviously, big Street, out, how pay or on changing really difference the in for of program. And attention, therefore, make the us patient, measuring more impact year but a Oak believe, impact of limited going that close that come our that have should so the has, is baseline read details as because we'll reference forward. shouldn't we

Lisa Gill

the Thanks Great. comments. for

Operator

you. Thank

Our Daniels open. of next comes from line your question Blair. Ryan, William Ryan is now

Ryan Daniels

could Thanks recently Tim the contrast Good or vintages well. if compare Mike, morning, a that where with the were few guys. you years model for ARK that the pre-IPO as curious the or questions. for for maybe guys regarding maybe evolved. various data you all you and at shared one how we to taking I'm and type JPMorgan Thanks that's ago

in but Now, realize here any transitory just there be COVID commentary impact I that's an nature, has helpful. would probably

Timothy Cook

the and after what there different three is our were they compared that. of of Thanks, your is handle to know of lenses data Ryan. cohort that some expectations I shared IPO. has I'll JPMorgan Tim. And this unintended two This question through how changed. I at confusion first regarding point think time at kind

XXXX and we many be the financial limited at and like of were Our subsequently half the impact also model a XXXX of short-lived will initial XXXX in marketplace updated is of think we until ahead hopeful, potential that IPO we delayed that time-bound. latter that the relatively summer archetype we're model [Indiscernible] the the XXXX. of model be created I in When time,

as in we on by costs sit slower cumulative such of as today, our to centers well be indirect experienced effect well impacts As impacted the direct -- has a costs we XXXX, today. here COVID, both as a we which results continue as growth via indirect growth as

present all So performance, step about impact which the believe evaluate the we COVID and center, center of how is we value we our about the from these net X%. back as think related changes was

So same still that relatively ultimate the are profitability at centers would immaterial of just they overall, fact we the the level, time that our IPO. given achieving thought

lens number performance. is a The second substantiating just our proof of points

Today -- centers four that were as they that expect contribution annual in categorize is approximately the we and XXXX. of at $X each So XX we we to of centers time million that $X most had each of IPO, million the generate number contribution. generated scaled,

wasn't centers about in upon on on think centers And generate historical the future our more at of results. the Additionally, older IPO. performance. years why are lot provided $X.X is to versus as that our me We XX average And outperforming that third, performance. archetype confidence seven time IPO based only are based leads a have we million we or that is six which centers expect in our oldest our is January which had to recent centers today more historical XXXX. of contribution those we And XX about that we of performance,

Ryan Daniels

lot an at-risk just color it that's just at then Okay, expected versus little on a the super a Year-over-year basis. clarifies absolute in looking and follow-up, growth my XXXX. lower looks bit helpful lives,

and bit into as to you curious as up can around up, some expect be go that winding COVID maybe a thoughts community-based marketing just down if with things ramp appears and So past we spring had warming little address part how in you here your here that, [Indiscernible]. do marketing to Thanks. the of change you I'm can may your

Timothy Cook

level Ryan, there FX growth That's on guidance, -- center the, reference are of patient projected reference. that Chicago even similar the kind in I our were opposed for front to we per acquisition of Great. right the like as But as on XXXX. saw assumptions an

projecting I think. So is to what net growth. we're Obviously

direct go And to in coming moving our by of channels, back maintaining last don't community today assuming, a earlier But installed so but where into our etc., factors a getting had as I the but multiple aren't in starting in patient marketing central reached this that's our obviously QX there's what goal talked baseline contracting year XXXX. more where numbers that centers, larger year. in we I obviously with it, we about base,

goal, our communities. to pandemic comfortable as transitions that's become from the obviously and and more COVID more Now, endemic people beyond and

we activities center the of couple get we our ramping ago. staffing up approach get and teams a events years types back community as were there. again the and back same of doing is can have kind our from base hope of really to Our And we still

one that's the terms years, to in into as mix. stopped over there's -- So hope to of but thing predicting on that I've working operationally, guidance. happen our of not spend learned Ryan, is concert couple last in the in Because those what's of the both [Indiscernible] going swift our baked

so hope we're performance can we'll we So for keep XXXX. I improve assuming from there.

Operator

Thank you.

Our next question Lake Research. comes Wolfe Justin of from

is now line your open. Justin,

Harrison Zhuo

risk-based Hi, missing a want correctly, anything. make think at the would in guidance. full-year this X.X sure the I'm earlier. this on which I'm adds Harrison patient guidance Justin, each I patient your you to implies in currently, XXXXX is the touched imply on thousand XQ little first But appear to adds quarter, bit of just not looking to I patient for following quarters this hit

grow kind [Indiscernible] other it year weight we're of think quarter the historically to attribution unique else or the or Is the voluntary driving seeing I first versus the member towards shifting of more patients this Cadence. maybe anything the with DC anything quarters [Indiscernible]?

Michael Pykosz

do Medicare ATB Medicare of changed think coming Historically, Medicare across patients contracting amount of we quarters. would the fair those the from effect growth our traditional to Yes, direct I period traditional an into a and of has shape change slightly Advantage. had

program place, non-risk to a go are our Obviously, of that traditional patients large and with they're in contracting at will so so risk. from in Medicare our portion at-risk. And they already

if that patients don't numbers. move those to they risk movement at who direct Advantage, remain really they on are and choose see you contracting to so -- over Medicare our in And move

be the patients think Medicare in that is to I of patient a risk. moving those from in risk. time at getting used The traditional what year of good beginning news bump to a already So are the AARP

an I think you we a quarter-over-quarter nice can that's more of for period you'll positive consistent reliant that in be have much overall, of I very growth similar as again, kind won't one so year. the on think improvement the versus it's see And year being growth but us where across seasonality, which,

Harrison Zhuo

as And one on given of that offering expanding updated the Got just mind and that and you're leverage. through the one Super your growth. ratios changing of center have helpful. the to it. certain how Would thinking your maybe pacing [Indiscernible] upon cost one maybe slowing just a about maybe leveraging spread amount thoughts last across or to centers still it you the prior overhead growth presumably of you're relative

Timothy Cook

Sure. This is for question. Tim. Thanks the

As you're the heuristic. you a growth a That we provided G&A what framework was about just referencing during simple JPMorgan conference. is know,

the driven there's center-based that and year If costs volumes. to ready center driven obviously, were was incur by that a our regions is volumes, here. component, fewer are regional patient fixed and pushed not If eventually And level, upon opening you going -- there's going year by significantly in some component about nature. have a centers any those this these number we're it be And to XX think later to push patient-driven costs then to what that's more in change much it to will in in of be a in component may instance. would've year G&A fixed more based had cost won't open that given centers. be because the centers will the in more center changes almost for centers costs, is. anyhow. nuanced likely going that's this a But to savings there's the patients that The obviously an relatively center the component reduced centers A few that There costs the XXXX we it the the be on entire cost in fewer they're we of April, be those weren't while are of opened dead open.

example. still centers that the future going two the open of six those in might incremental benefit We'll four we the get to we So be today. in were before, centers in years as that it have ultimately region

math So center that months months given than we fact just fewer contemplated there's we're that see based It's obviously the time. XXXX center to we operating upon at be the in fundamentally just expected year-over-year going in improvement the same still to to that doing leverage, degree nice not at are and had JPMorgan. we'd going

Harrison Zhuo

you. Got it. Thank

Operator

you. Thank

comes question Fischbeck line from of is Kevin, next Our of open. now your Kevin Bank America.

Kevin Fischbeck

XX you're maybe have you Great. a plus Thanks. When Is opening about versus previously. you eight new sites new concentrated at already thinking in question be to new expect Maybe new opened, entering still those past where follow might new the up that up mentioned all expect a or year that would you there year, about be geographies, that being about a would you states been bit sites change just states? states this are a to you XX the in little on think there. sites entering

Michael Pykosz

I appreciate question. the

opening at continue think same, the the of will the, we'll is that Arizona. Chicago of centers see markets. we have. QX, In take approaches be exceeds [Indiscernible] Phoenix, the to we some markets be we also demand of new currently up [Indiscernible]. centers our more in as in opportunity Centers in existing both in care opened in I patients and our We'll up open number to the

but the XX prior. I some So think all the this of those a it we both will of those be to is Probably planning more still XXXX, about push way was a it combination centers bit we'll I different. open approach think is were open it year, as of just don't [Indiscernible], into we'll

Kevin Fischbeck

a a an be Okay. maybe I'll opening of risk one the at to long-term center of And opening investment? then center, [Indiscernible]. maybe Does a is from adjacent economics these a better kind of up dilution better the just surrounding or at understand new existing to We're centers. short-term centers. that existing up of market better the entering

Michael Pykosz

market there's I market. in between or a center and new divergence think new huge existing a an center new a don't

we've are some city have are them and (ph) or if teachers kind huge our density them some centers first in in high neighbor, of are but Chicago, higher poverty. Tim up, of those think of -- middle-class are a retired of blue-collar, of neighborhoods We a mature in XX amount have of the you at in variability referenced in, rate types a are first centers, even in that number more ones look market, that the our -- Chicago markets are put obviously so the earlier, kind in of much

income The Gary, of aren't are certainly them first We're well communities, also think in all places line night in similar have actually doing And I kind quite or but of to approach better Indiana go where those very at type of Some than Hispanic places are from I those a each. market Centers to market, Rockford, perspective. it's Wayne, and Illinois, the center and one look part perspective of similar, average in vintages. firstly both like kind when are those that those our initiatives Chicago, of Detroit, a reason In we of XX Fort is those nature. replicability predominantly centers, remains the And that more say and Indianapolis, of and the ramps demographic breath you and scalability that size the from are kind to drives of what usually center Kevin, think think about speaks the catchment retail it's your around What almost do. is center. in always enhancing also we And market it I I is XX. the the is in

really good about you're or to are it's are so markets. teams and a Chicago, engage in our able and historically you Southside wide, community to so across at serve to adults range trying wide are and Rockford the have of the And older XX,XXX who going bring that that people whether very or been

Kevin Fischbeck

All right. Great, thanks.

Operator

Piper line of open. now your Jessica Tassan from question is comes Sandler. next Jessica, Our

Jessica Tassan

Hi. taking for my questions. Thank you

if payer can of and the that's you And us so on revenue the impact patient operating that case, expenses. recruitment diversification just has remind

Michael Pykosz

again? it Jess, your of I'm sorry, asking you you broke questions, up there in the middle mind

Jessica Tassan

Yeah.

Operator

the your Is isn't apologies most just it my line? Sorry, Jessica, I okay can if disconnect your line strongest.

Jessica Tassan

better? this Is

Operator

your a one Jamie Apologies now Perse is if open. Sachs. for press of Jamie, question re-ask star can And line our you that, question. comes next Goldman you from

Jamie Perse

wanted guys. morning, a high you're sounds If like you're for year in new prior to increased PM trends? of just some I that, all range, line assuming what of what the and to you for and then you medical that, and and vintage relative with of expecting nonacute on to through costs prior trends those XXXX, go good this for it on and utilization, adjusted the the areas guidance assuming that patient are and costs in be Hey, economics ranges, basis your confirm low COVID end can for

Timothy Cook

is Tim, question. This thanks for Sure. the

utilization nonacute effect, my and our well, of carry going I categorize patients, think probably because the some it system's forward just sick. of impacted number employees given just had patients. at a to more the know is not particularly be the who out Omicron but there to were centers, even manage we how I were ability you guess

in we into potential So Delta COVID in May, pretty to that the think vaccinations it I level increasing and relatively We'd increasing the back would -- Omicron. given From ray comfortable going year, COVID be me, going bottom of felt we our excuse million of the when we'll expect of surge that new Omicron but sitting experience, the think And see --, if got us. patient overly the had all just were limited. it's XXXX, I'd with and be we to the PMPM XX not with the vaccination to COVID, the about number would implicit $XX there with around behind of say that range. from and just XXXX. carrier a be $XX end is any of we end look I XXXX, forward PMPM that this point million If here unknowns at year, we COVID hard rate specific costs to at than

experience XXXX. we're say very what I'd of than again, similar level end new of range a much unknown, economics an in had the low Our are but the patient assuming we

Jamie Perse

you last on basis $X.X and for Okay. of on $X your and billion couple your centers. that seeing longer-term has get lot patients and XX There of been in a MCO environment terms impacts to contribution that. that of pricing months for XX just Thanks the PMPM for in how for a you and what assumptions, you're when billion and discussion curious the

Street. market Just what's Oak on and going in around impact any thoughts the on

Michael Pykosz

MA The with plan to existing invest Yeah, MA decade new of for share. prior expand seems and large obviously, going entrants is new grow now. a this market, on get been market a more and continuation to markets the the into trend the competitive that's more and players

across and benefits obviously plans. as higher we're so aware, well markets you're across And seeing,

implications so Street. Oak two And for creates that

at for the one at obviously, the we're On benefits. risk, risk hand, also being

richer richer so benefits Oak obviously supplemental sharing, or if there's an And cost creates expense that Street. for

Although plans to oftentimes that higher or expense etc. offset is and benchmarks higher higher rates by the [Indiscernible] performance, also

the percentage mean risk which obviously of we increases, already other a a side Medicare our Advantage that penetration at as higher are Medicare percentage people patients community The that of Advantage, get us faster. higher that at it, of helps

that And more more becomes for there's people. also some Medicare so from and benefits compelling Advantage penetration increasing as

think they're helps. So Obviously, we means that there's to as patients some countervailing factors just patients, but something patients, think higher positive closely. watch in stay and Again, still there percentage it I the it's as being. -- about we'll investing, plans Obviously, not healthy XXXX, them of it's or a our overall mean, because they're benefits into future. especially trends their getting increase is overall help the I also what more at-risk

the and help us does most also that them. And so care that's thing take important of

Jamie Perse

you. Thank Okay.

Operator

you. Thank

line is of Anderson your Elizabeth, Elizabeth Evercore. from open. comes question next now Our

Elizabeth Anderson

in so the terms versus model core deferral it versus in which guys. expectations of openings Thanks Thanks. XXXX? a you Hi, openings run to much year cost the on the center the of for some so laid originally of could planned shifting part of like Is that, that thinking just you're center mentioned see from in Tim one-time XXXX earlier in difference out of this how the question. the result XXXX. of we presumably that about some was the the more that to is the year for those possible quantify difference to rate impact maybe

Timothy Cook

perspective thought centers, -- as one can most Tim, into on we cost XX, towards those what bandwidth and process the perspective question. we're We've both synergies Therefore, the a as fairly it's across XX had as can our about XX from over had effectively, -- team for all focused thought Therefore, not were before, rare to the were versus thanks through time, well you center. accuracy. from did for we with indifferent as But never move we say reducing Mike a the XXXX. we we closed set exception. to success we as mind another, walked number imagine, I'd great

to by that we're earlier imagine, you centers year the to later. can in earlier are to going the year. going As that to slated that open open large and were XXXX, we're centers open in were the moved probably The centers

to from what the of From new So a it's those we're centers dead an be in in impact cost less approximately have might perspective, costs we benefit XXXX. otherwise XX in have on $X had average, would've XX say to perspective, to we loss we'll are wouldn't going XXXX center million no I'd open. going going longer than of far Obviously, centers that average than an a XXXX that incur we more lost that on opened is that centers. the we

Elizabeth Anderson

market just in each you've wages Got Do doctors and pace? anything it. at you staff been of terms That's and the updates of of And in hiring have providing terms clinical helpful. of know I hiring the terms other helpful then to in for previously. centers and both say the

Michael Pykosz

I to that speaks sort provider our months going hiring we over And easy. see help to success a providers, that. prefer want XX% value for care the them And our existing a our help expand, really very proposition more also do to we Street, we to providers of we practice and to more them team Oak we of of right? value work a since that capacity short day more But our Oak the than are certainly continue seen [Indiscernible] best just us, past versus providers we've more both that all for our work. provider say and and been and had patients is Where to our them right? family as of providers medicine in friends probably recommend never they for continue that great challenging year, give started differentiated care to against provider, market hiring and how It's scores, team, thought from to centers. their the we've us obviously the of for thought standpoint There's providers, think care for And or works, Yeah. have new say that's lot past. to can etc. we're have where patients. and patients, centers incentives in to of a our allows proud Their we XX% quality really volume a they they place resource And Street way have hire

I labor that market, value being to this us think think a hire successful And despite higher and the be that proposition end, allows so tough I it in environment.

trouble I'd but recruiting, I our the so team be door in for [Indiscernible] would a me, environment a [Indiscernible]. And be us tough in of and outside to they're kind said if it great was waiting doing recruiting allowing job

the labor haven't an far shortages So our goals. impact on ability our had and

Elizabeth Anderson

clinical true well the and other staff provider’s sort as as that's the of on level? And

Michael Pykosz

concept same true Obviously across board. highlighted the providers, but I is think that

Elizabeth Anderson

Okay, thanks.

Operator

Thank Instructions]. you. [Operator

Tassan Our next your question Sandler. comes open. is of Piper from Jessica Jessica line

Jessica Tassan

Thanks for coming back.

in revenue Thanks. the on just cohort diversification where patient Exclusive patient Oak So curious the of year to know per so, payer Opex if impact in Street has that if and XXXX first Centers, is impacted the recruitment, what's XXXX? Bureau at

Michael Pykosz

(ph), Thanks period kind of time alluded in the to, I always XXXX for XXXX. opened we learned XXXX, of of Centers, that for now. we economics. impacts that Oak number and Street the it's exclusive was was Very large you our and and Centers I experienced up them grow exclusive [Indiscernible] a to something haven't think number think that, question, as That harder years different for Jess and a of

also year or think that before before And so we that year either. year any the last the I didn't have or

are ramp like, we in account Centers ago, that kind what's So highlighted ramps of into I that kind our exclusivity. the that's all Centers presentation and we looked these what of takes the looks of expected like actually going multi-payer coworkers weeks think shared of kind the seven forward, that kind without

So I in kind the to of non-exclusive would presentation. guide that you boxes

Jessica Tassan

sales G&A thought to a OpEx and given off in the couple the it. as still this That's the marketing month Got per Thanks. clarify year. per were of way my center. think of mistake. you XXXX And correct can slower there plus follow-up, about then center $XXX,XXX I still just a kind rolling It's growth?

Timothy Cook

more the thanks. otherwise -- the need many XX, to we year. of contemplated weeks center it's Hey, Jess, that ago that Tim, investments we're I'd is few months make. make number to still to was in XX say we're $XXX,XXX more provided a Obviously going G&A to from going going

that we my low will on incur. I memory, in based won't costs be it still We'll was So given be year-over-year some doing of leverage, still so $XXX,XXX, I'm earlier what XXXX comments, that that believe, that higher. from it won't about will but number number those just as are $XXX,XXX, see as many be this high.

Jessica Tassan

you. Thank

Operator

you. Thank

Taylor open. Our next is Gary now your question of from line comes Cowen. Gary,

Gary Taylor

Hi. Good morning.

little platform what other around with contribution platform get after than when spend? last guidance would G&A wanting $XX was more probably think contribution think looks your the lower in the year. from $XX it be around to targeting the But million your this answer that archetype presuming hit is we range like the a just EBITDA bit I million And I'm then center about angle. openings, I on

Timothy Cook

patient COVID Yes, by Gary. say costs I'd contribution? the is I two economics. is new driven correct, mentioned platform that and the variables around By really that range

a sales our and marketing. degree over expenses, We well as high our of control G&A have as

range that little for the included in relatively guidance. there's So

Gary Taylor

Usually tied one payable year-over-year third-party lot to but medical Got payable final a or that is it, AR up either health days’ sequentially. medical and and to up medical can year-over-year plan and just was sequential your days claims settlement were on But AR then claims days than those lot more timing, also follow-up. expense of your just reserving. days? you a so or less comment claims a

Michael Pykosz

brief follow-up, had that the I you at our questions. contracts accident happy background, if sirens But Gary, some work folks office. way and our car the apologize we in and hear be there's I'll to if

that that it is, of being we're where surpluses the are some to surplus an paid call of costs Oak sort For our basis making paid on the premiums third-party last providers. contracts, our would what of plans our estimate I'll being to -- Street we're an pay medical ongoing the

that contracts, is don't what amount cleared. will for half are some ultimately an our about claims estimate sort so be you our of paid what because amount know that all net we're medical of That's obviously net And of contracts. until

$XXX way medical paid a where other half Because a plan balance and -- surplus health accounting we're of time. by is of what to more PMPM. to of that related We're to our And are given period costs, the receivable arbitrary The manner with related performance that XXX settling recall the until full visit the payables fixed until some health cover carrying we're the and the relative payment plan, up interferes. we're claims. doing in that actual then a the in the both for we revenue works settle that upfront

direct fact that been It's where paid that me, in you're so And bit contracting more than amounts, actually there obviously grow those QX mentioned it's in structure we're excuse it's unusual going but estimate flavor, has periods from of [Indiscernible]. a different factor business last how that, the been function in our because as and just the I a the a second year-end akin those in nothing would've an other to bit we're settles grow going also to IBNR. overtime, to buildup -- that CMS there or and performance. a continuing see to contracts a that not than not getting past, difference to that's of

Gary Taylor

you. Thank Okay.

Operator

Thank you.

of Ricky next now comes Our from line Morgan Goldwasser question Ricky, your Stanley. is open.

Ricky Goldwasser

morning. good and Hi,

great. to SGNA terms your would which it that is trajectory. impact physicians, and of in question? does you guidance how labor of successful clearly the But seeing XX sort wage about question compounding when in being back going inflation So XX, up How effect, beyond XXXX, question, top-line my It impact XX, is your we And adds that this center second about stores of right? to XX, just and then are i.e. long-term growth, ultimately. too is What centers first does hiring think cost, target you hundreds a in

Michael Pykosz

that question we're but around I Maybe we're Centers thinking just growth. nomenclature, impact XX XX of now part first it's Centers update the of wouldn't an the to -- centers. say XXXs if On and

think rate building years, XXX still of EBITDA it revenue a end to and growth XX% plus. would From will the growth large XXXX an few By the be Centers, we that $X.X over decrease. give billion, of Over as years have so Centers, our rate, embedded XX still we should a will Centers next us profitability. three that XX compound be over innovate the

So be growth at it'll question rate. think revenue again, a we around what still your second robust cost. To

to remained Our past. have they've similar acquisition in what the been compensation packages,

longer-term assistants, the impact directly that or would directly insulated be for about did based health right? to nurses is that It's note way of the from there will year but we costs because inflationary which Street actually higher etc., We and or have healthcare meaningful in obviously, pressures medical presentation. the range always revenue. by is shared for team that view, One I doctors guidance, still in is benchmarks, more benchmark our the we adjustments a cost the Oak from cost costs same and say impacts our traditional term in them haven't would in Its This of living care, revenue other in every impacts changed And extent the increases small derived very which longer Medicare, labor for obviously is inflation. JPMorgan directly the the of on a them. Medicare.

in doesn't any obviously benchmark automatically so And given year, increase the real-time.

in tailwinds time, feeling, year. have X, some you about that if be may it X, whole any it will felt of period think pressure So any extent hospitalization market Street, but health The our it the care and up X, saved go X, the in is it by labor revenue. by be And inflationary very But value X-year headwinds that about of X, of may to given and will think the go we've in healthcare offset will up. that the also the means costs hospitalization up, go actually an cost simply. increase Oak

Operator

line open. is comes Brian question Jefferies. now next from Tanquilut of your Brian, Our

Unidentified Analyst

a a serving Hey, range at at SG&A on the of end. slightly my about the it's Jack million Brian. versus ask to $XX shaking GAAP million the Not low maybe it We're higher out morning, guidance high is belabor end taking but questions. XX good question way. I'll Thanks on your different that for for is SG&A,

the that data cohort consistent. Assuming you provided is

the had higher range and you provided of low the previously. end For

on to I a know of that those are to driving variable costs I little Mike, understand So buckets. guess the terms it sort that what higher more that patient of in that help Delta just basis, bit bridge sales and any in But want be alluded gap per-member it guess hit cost in systems a I us you to is it and marketing Is helpful. and I comes number? color to

Timothy Cook

Tim. notes using to it's that. of what get Maybe you're to on Jack, to compare Hey, exactly just sort numbers

for just end it's of As in more I something and for between and -- around range on whatever wouldn't that if and I range we'll wider number, it range because I'm Maybe is into refine assumptions with see contribution. a that the is that the we've [Indiscernible] is relatively guess assumption sales is to driving the in mentioned, and G&A something what's high marketing. platform around expect my going narrow getting or sales low certain the marketing good, not to Gary,

Unidentified Analyst

happening how under should Thanks. from Okay, conversions contracting seen impacts noting? Is anything line, or got follow-up. If actually consistently MA 'XX in thinking direct about An it. be you MSSP into that PMPM? have lives worth that's direct and contracting to from quick either point just then so, interesting into over 'XX. And a that from something MA. Acorn on conversion we on Along

Michael Pykosz

both choose we've And are works will are Medicare Historically, that back seen always it Medicare, be to ways. some on and patients who Advantage Advantage. move traditional some there Medicare Medicare obviously who traditional patients

see back to the in choose we general, move And that's of across MA those continues obviously compared last that increase. it. who a healthcare in a Although, to -- net increase trend decade micro of penetration a that's as number out approach macro the patients over MA's

is direct alignment. So we a the Shared see certainly And Savings Program obviously claims-based Medicare contracting that. or ACO

we're part generally that savings didn't program. that the know program in patient, or existed the of So shared the you

the sign have I have is next patient an not there's lot a the the direct are about program their of Well, some form from aligned. what standpoint, claims -- they contracting, ACO, that has savings how health of contracting more guess But right? line. coverage, doesn't a so they patient them little And not the to are It's have an voluntary and so choice shared health they thinks impact on And it's direct least, year, no how now coverage, we X to patient not plan a irrelevant From at because it them get to patient's gets. paid. plan coverage. a patient definitely whether the impact insurance it's benefits. on about known of 's relatively -- it's do, to

to for so better still And choice a patient Advantage Oak choice. because differently get just have same hasn't the Is changed than way Medicare get Medicare. a That Medicare Street the my paid patient's coverage traditional care.

movement why you And see years. the seen past think still I you've so same that's in

Unidentified Analyst

you. Thank Awesome.

Operator

Thank you.

Leerink. Whit SVB open. is Our next Mayo comes line now question Whit, of from your

Whit Mayo

a How a do some going of bit think a your and of guys call handle put coloring is like it Can your bit. just providers internally seeing of just capacity the get or turf? keeping the the little mean, like more care sort people perhaps legacy to models, more how seeing this is encroaching markets. I'm you a a little feels what at I your existing competitive obviously spend Thanks. around guys markets just a feels we're more just in future you new like about Street flattering, for your for legacy on new look just the landscape? Obviously, Thanks some strategy markets. lot probably and primary frustrating more we're minute economics about maybe which on Oak in trying on time. views same in

Michael Pykosz

a It at appreciate for positive we care. lower cost think investing is question. more the guided I and and in need this people the country. I a more Overall, in have that value-based answer healthcare quality are right and entering based care, we higher value

catalyzed lot performance. we're the space, space think and proud problem, huge because in is are, use the one change, investment that of the so great. variety a to are that's there out groups of So we're of the how is people helping There's different market, your from of a there they're to lookalikes relative Oak going addressing means that we how obviously but and the in that things term Street there at

hard scalability. Street So was proven we've success do of started before care what long it's we I think our around really to value-based level And and do. Oak and

massive. So perspective, from is market the our still

gets things more a Which as from is et of are like -- as doing many the lot they their of provider aren't se competition same, per feel different is groups groups. partnered As you existing still with really necessarily a don't experience much doctor differently. their noise around perspective, hear patient kind if them we model, because cetera, even center-based paid

experience, is about creating which from perspective what a patient So is growth. our drives our really compelling all really

even same And the successful, in directly there's the to more so We the lot I but attacking out we And are incentive-based number the of compared think small of hope kind and really to drop they're We're a of a don't more Street Oak I similar in doing bucket all the that just the way of providers competitive. problem, think really groups not there. very are. in that it's are groups number model.

doctors in XXX time. of we share practitioners this think magnitude of kind nurse primary something the JPMorgan. I care at There's primary care and thousand

six percent thousand out each, had So with Street the there. a even providers of teams like Oak still care would if we full total half be centers of

Centers So long and for know at thousand again, we're this full what a we a time. way

of the So market. the that that again, I size think highlights massive just

our over it's people this and more others along way great, way, me, the can hope so And us country. costs think really is it. for is care next really transform doing decade are I and lower the improve let delivered And the and quality

Whit Mayo

Okay thanks.

Operator

Thank you.

open. James Sarah, Our comes next line now Sarah Barclays. from your is of question

Sarah James

new any talk you are that about assume doing in engagement? patient does patient what earlier of you're squeezing XX, care Thanks new about me think members for change profitability for engagement? first And when in. cost drive earlier Can to year to you

Michael Pykosz

Yeah.

their to So I in our we it see aspect and and that when they definition, grow BDC cadence are, gave get the programs they're data couple they're is, by are so They're really and invested stratify trying visit way mean lot on appropriately to years process. visit, come call patients they Street patient understand welcome front, the the start. for the a are, they into engaged want then for we back Oak last what and right risk the coming regular in welcome couple later of them the of to in years call a other model risk one over right coming right back way. of we factors the really We don't and care. sure what often conditions We make in stratification engagement

how to they actually you big about so makes New that ago machine of do catalyst That year about have them? to, harmful? data Medicine has England been is resources we we're difference How more appropriate better available to now. risk who So understanding, the of points of making a focus kind risk and and in So be Journal from quickly make kind coming paper on then of a a starting impact plan an That on health partnership satisfy come using think make sure talks a a taking of really at obviously as in patients. think publication a impact along focus, we to people kind or make first published I learning like of But will one-by-one care. patients model. or their they we're patients. with them. sure in not great say, We're I care of continue and kind a It's scratch when in different population and add than

in through to say, embedded XXXX. assumptions would improvement And to plan profitability there's performance get the to in no, that of so thinking what I through -- projections,

think -- all in XXXX we how our And are or that's that that. growth will continue how or we how today of assumptions whether the components is different before, it's we rate how perform. to is created I our we or the built the performing plan, profitably

what will better our patients and all dimensions. performance performance. drive built and we'll around our improving across thing obviously, the That's there's do improvement But team will assumptions to focusing obviously keep Tim that so also right for no into focusing And -- shared. keep

Sarah James

a profitability you that color towards And any mentioned to why happening expect times trend Great. are faster cohorts is little us follow-up center new couple cohorts. you've a Could continue? of than that's if on progressing old give and you

Michael Pykosz

a organization more XXXX, XXXX, were effective are today we in XXXX. much than we Look, XXXX,

million $X.X XX So, $X the if they're were fall and making years, that of you Those million or contribution period centers centers opened say the we look in back are are more. and those to that since up you time. making, then, in obviously in ones that closer this started year

And so we the has those across is care have training. we are operating we've of model better, we board, more whether our think robust, are in better we across days. we have better better more technology, board, at I programs, than were the Kind gathered it's better

And so we are seeing improvements.

same we recently KPI look at they're or and opened, the We those much ramp XXXX at centers. if XXXX shared at metrics, relatively centers. despite the that our the and XXXX faster. in ago. And are that that the And can better -- bigger the vintages, just centers then earlier being data Our those than look years similar ones, to than care you growth much we seven weeks for vintages model on ramps metrics from see the XXXX you like presentation or

So That's the us all on that return And they we're the support was what $X gives of six very I putting up profitable, to years, very when or feel range. now or better centers like us eventually will, three that confidence forward that early that. have and we data things the of the that from depending be one contribution at open, of million working in five confidence in that gives lot think than will is million $X.X then is well. and they're centers, those that model obviously going they're a lot it a we

Sarah James

you. Thank

Operator

Thank you.

today of open. Our comes Larsen final question your now David line for from BTIG. David, is

David Larsen

The model? in plans Any rate above plan for in advanced anywhere break X% growth per quick in What in good in your in around Medicare 'XX, for publishing even coming how, notice, on would congratulations near expected are Hi, your XXXX. If question would to of timeline. thoughts modeling change revenue revenue in terms well look that advantage One Capitated Fiscal above your 'XX. EBITDA with compare that? pretty line Thanks. patient? longer-term for be that it's you MA

Michael Pykosz

Appreciate the congrats.

On mind are in and is middle. the mechanism, when rate one plans notes benchmark revenue, Street how removed thing one the that, a always health in you the actually go The to Oak changes in from XXXX keep provides about health buffering rate plan we because step the economics.

obviously an the take to more extent to So better invest net patients, drive penetration in that that which earlier that benefits the for call, conversation and they worse rates from But go it increase necessarily perspective, rate patients generally, there's because, will is costs same more will negative medical wouldn't in some up, if for a and we also on Same impact happens mechanism of had plans in patient a increase risk Oak largely Street. the benefit will if economic even Oak our goes a our buffering noticed thing economics the on offset. have Street up revenue are our exists.

at the again, felt taking of that XXXX health patient risk than health basis, a from we patients types system in from block talked PMPM X, place, an average And patient year. a those So with are in say plan higher pretty in because health new Still we higher then in XXXX, very contracting, a plan. than step-up driven extensively have we And especially we care about has XXXX. growth see by would a and plan less XXXX the as a and on then would revenue sensitive our without or. documented obviously revenue part under Number same the engaged had that rate, to we full-year we direct were in things

in conditions documentation, kind be to document that that XXXX, so now reversing to out don't obviously chance we're going understand so of ongoing and phenomenon. under And had patient’s think we've accurately I that's a the

one-time think case. that I in catch-up a of more it's

color how bit think that So on gives increases. a hopefully we the more you little about

David Larsen

great, very That's much. thanks

Operator

you. Thank

for you We today's call. have no stake. questions joining. Thank That concludes further for conference

You disconnect. may now

Oak Street Health (OSH) 1 Mar 222021 Q4 Earnings call transcript