Earnings call transcript Q4 2022

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Operator

Ladies and gentlemen, good morning. My name is Abby, and I'll be your conference operator today. At this time, I'd like to welcome everyone to the CareMax Fourth Quarter 2022 Financial Results Conference Call. Today's conference is being recorded and all lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. you. Thank Instructions] [Operator

now of conference Investor will Swerdlin, to Vice President Relations. turn I over the Samantha And

You may begin.

Samantha Swerdlin

call. Vice Thank Financial our you, I'm our and earnings Chief quarter to joined Officer. CareMax's Samantha and good Carlos and morning, full everyone. this morning Executive year de Relations, Officer of Chief Investor President Welcome by fourth I'm and Swerdlin, Solo, XXXX Wirges, Kevin

certain made forward-looking on the CareMax's information. and forward-looking expected to During be believe call, of based assessments will future be they statements assessment trends, light assumptions in discussing and and of by we management are developments experience current factors appropriate. These their other historical conditions,

to results, statements are could the in statements materially statements the the call that such made forward-looking of today, cause factors whether with Important made SEC, as and forward-looking filings a actual differ and information, to Factors. during business otherwise. from entitled Risk or company's the described decisions no or update are future events developments result revise of Any the section duty including new as CareMax undertakes

non-GAAP In GAAP metrics, release. management, today's be these will certain the financial morning's remarks metrics. found of reconciliation most we non-GAAP comparable in be measures A press can discussing this by financial earnings

that, now turn like the to call With I'd over to Carlos.

Carlos de Solo

with XX by four Delivered ending our Good new Thank added adjusted marked thank and XXXX growth our today. call XX guidance joining revenue states. a locations expansion. everyone and was guidance you, range year We for EBITDA on membership. morning, CareMax significant Samantha. you exceeded across centers, national great for and and within our

care the stored in care value-based forward MSO our a our providers primary in took XX national in care states value-based presence major lives acquisition with expanded accelerating and arrangements, XXXX XXX,XXX to platform We approximately network. our with step of and also

of opportunity. the for strong have hybrid We touch and provides industry across made a MSO, the combined country. with the our in about to transition high very are model we believe platform a stores We leadership capital integrating our centers, excited with as care value-based tremendous light us progress

Now report the operational we're medical the for XX.X%. reflect from our year. Advantage expense XX,XXX. metrics to the at highlights that efficiency. for pleased commitment providing to to quality remained quarter, It's maintaining membership increased These that And quarter center ratio to care noting turning some approximately level NER while worth continued our XX% high was Medicare

on CareMax performance continued strong deliver family focused members across quarter, consistent care. remain high-quality We to have our operational access we ensuring to during the

Our physical rebranding efforts with are our one CareMax proposition. XX% already of footprint enhance to value well underway our rebranded

believe our benefit We to senators continue our all in in we've rating XXXX. as underscores to and as our across evidenced five-star this rapidly. best-in-class made maintain We patient care Florida ability grow experience, from investments of by quality that we

Further, promoter patient score XX received our provide to during net the patients A satisfaction to centered efforts testament a and for saw we've of member accessible XX% care. year. of over

our centers better at care total reduce continue primary can areas gastroenterology. diagnostic of pulmonology, and care out we in physicians services, offered and cost services by these endocrinology allow care that Among more between the and significantly believe specialty other as we initiatives, such build offering services coordination seamless for in-house, to cardiology, We and specialists.

to our rate providers strong patients. that impressive building for we our care is providers critical exceptional XXXX. That's our to that retention relationships delivering We primary XX% achieved employee why report proud we're to understand over an care with

best to services to we possible focus easy believe comprehensive making our processes. do our attributable provide patients. for it caring and that We as in the strong technology retaining from to they We're of for that success to administrative providers is directly streamline providers committed on range what support

CareMax, delivering our patients. care At meet unique of that solutions needs committed we're to comprehensive the

expanding part a this pharmacy standard for throughout launched Recently, the region. pharmacy operations. are offering pharmacy Central a creating we've Florida the we been our currently in-house commitment, of in As process of locations and

goes expanding Our having pharmacy patients. cost just providing manage to in we're By our beyond investment pharmacy medication our patients’ offering present, larger to total care. of able a

We their also medication prescribed adherence programs, ensure take as stay that members provide healthy. helping our to medications and

deliver And the about patients drive for our pharmacy excited market. believe outside Florida and of will Early operations. we're our help up Overall, began made these XXXX, in we growth. our and centers we've core continued us expanding better efforts that we opening progress outcomes

and build the City, York in Bronx, our We have QX. during Memphis to presence our opened continue to New have we including now seven Center which first where Houston and expanded density in centers,

The seen the from open year have very encouraging. the been results we've in earlier center

in We membership have organic with now strong their hiring communities. driven by our have sales and X,XXX York exceeded City in roots our a PCPs goals, and respective patients New team deep from

now Memphis, we Advantage approximately had have success also where patients. Medicare We've in XXX

in patients, and relationships providing families community. both building has driven broader been care with their by strong the growth our on Our and quality focus markets high

Looking in ahead, our we're excited about new the markets. growth opportunities

acquisition like on the business provided progress scale momentum of immediate stores to care across Now you of gaining been update value-based stored our in since country. which acquisition have to us value-based the November. integration I'd efforts, deliver The care

care comprises markets. full a XX approximately ensure Medicare XXX,XXX in employees time now this patients we X,XXX and support providers To Our value-based onboard transition. smooth and to states over XX growth, network XX expanded

provide with they need to of working encouraged network are them the transition have care. see local store to in eager practices care. successfully this value-based model resources to are We and adopted been to we education that closely And

transitioning side, Medicare Medicare progress Advantage payer beneficiaries made care fee-for-service the into stores Advantage we've that On in significant value-based arrangements.

higher value-based contracts have of the moved We risk sharing. with of some levels also legacy stored into contracts care

us shift of in arrangements their this portion ultimately will to in shift business and as strong to to position report risk-based significant that population partners fee-for-service our our our area continue, Advantage stored strategy. a Medicare We into payers receptive a that are value-based aligning this with seek the risk glide pleased care believe to are over puts that arrangements, path into time. more We momentum

Since of been which of innovative touch technology founding CareMax, our system This high strong delivery, results. approach includes blending has our to the with have proprietary comprehensive unique committed approach a targeted driver care. taking healthcare to of an key been we

As we integrated others apart that's deliberate We plans. that centers, in hybrid believe MSO capital from continue the performing light model healthcare of to us our pursue a high growth delivery with industry. our

look ahead excited to the ahead and momentum more we've we be the couldn't us. we about As the established several next that lie for years, opportunities

made country. transforming as business, and our operations one our in to past care year, largest a national we've significant the expanding operators the scale, the of strides value-based in Over establishing ourselves

our to XX to have on that and will EBITDA years. unlock value-based We significant million the focus care believe adjusted for to delivering quality over $XXX drive we continue growth opportunity five and high $XXX that shareholders. And our value value million to next the

discuss want March Now, upcoming I to on Day a take XXth. Investor our to moment

we deep deeper members great include we for impact will a you have vision communities and and on We the our with many day strategy away business, will come hope plan of serve. we have of our the understanding a you, presentations team, leadership which from

next to looking seeing are Miami you in forward We week.

our They exceed of and our I team incredible expectations call and to dedication above their business keeping to over past the exceptional Kevin, while with work year. the members the always Before care hard to for needs commitment over to beyond continue their hand to want members deliver thank growing our all going the I and first. health

quarter With performance. that, to financial turn fourth provide Kevin our I'll over detail it on to greater

Kevin Wirges

Carlos morning. Thanks, and good

XXXX in Tennessee, and you we've With we ambitions open de Memphis, of centers. As New continuing de Space done platform just new core new as Coast that. the now have had XX of Texas We're novo EBITDA those Medicare XXXX. our us and novo and City, clinics And followed care year-end while Florida. our who date know, Florida differentiated to grow in to our markets. over in seniors to members Houston, to across big York bring membership All serving

next in And financial fourth our XXXX. in for are growth the from And the first provide and taking our results full guidance national XXXX of we now recap with MSO quarter step Steward. will then I year integration the

be our beginning if pro XXXX As reconciliation to metrics adjusted can the non-GAAP EBITDA with earnings like for GAAP they our in the release comparisons of a found of Health reminder, forma occurred CareMax a as at XXXX. of year-over-year all IMC combination presentation in and had

XXXX. revenue no high-end stock our of million note our the we reported but gain by cash items million, that fundamentals, going $XX fourth the the of non-GAAP guidance Steward have revenue impairment equal due looks our recognize fluctuations XX% the above by financials. or the to into quarter may liabilities at remeasurement latest Coming XXXX. We quarter $XXX original These up the $XXX XX% a quarter Before of million impact charge arise and to they goodwill from of guidance the full This size earnout midpoint related offset of of in like from year in approximately I'd from transaction. exceeding up our on fourth to the fourth price, XX%.

the for MER Medical was full expense quarter bringing XX.X%. to XX.X%, ratio year

exclude figures are patients novo MSO full national or MER clarity de For not risk. acquired that

targeted both for XXXX in performance. our for existing members with our XX% long-term in approximately members MER approximately was in Importantly, and and XX% MSO, historical line centers in

expected in fourth contribution was up XX% rebounding Full was quarter in the the million, XXXX. $XX.X XXXX over fourth XXXX. year we and over had contribution Platform of related platform XX% approximately growing quarter headwinds million $XX.X as COVID from approximately

represents at established platform over most some maturity, centers our contribution blend As stages platform reminder, including margin. at XX% contribution a of of a of centers different

but better. core XX% scale margin not platform mature also contribution to a de see opportunity just to continue or We novos, less Florida centers to

adds for our longer losses change de no opening adopted As in figure. novo the EBITDA, costs we've post reporting back and adjusted a that in preopening

been this onetime these and million, approximately million $X related the approximately internally another expenses or done markets million expected XXXX, $XX of professional fees. for adjusted $XX adjusted Together, our new at guidance. de EBITDA million, losses midpoint to favorable our novo over have de of $XX costs million enter for losses putting opening which would recast $XX EBITDA were $XX post of build reflecting to to million, we costs, preopening XXXX, million $XX novo and budgeted Had guidance include and out our

be is of was deploying the by and shows this are as opportunities national to million. the done believe new a growth. Cash novo of December, markets. growing has we capital end there our efficient MSL, With and de job judiciously great towards $XX more And membership even leveraging team

drop Steward VBC the reminder, fund to from $XX pulled As help million term a acquisition. our we loan delayed down in November facility

DTTL $XX of million. $XXX into This with million [ph] week, of million lenders to invest term current of we our entered and expansion the continue have our an and with $XX an Together had under our capacity would facility loan delay to additional MSO. creation million remaining amendment and add of of novo and $XX our value liquidity as cash year-end, we de total draw

increase that, to capital further credit working raise needs. million million On lenders worked have fund $XX to our our we ability from top additional to revolving of with in a previously $XX

in the be conviction with of challenging to Amidst business. viability have macro our high that oriented the fortunate long-term in stakeholders backdrop, are financial we partnership

of growth strategy the fund future. liquidity, able current be sources these we to foreseeable our With expect to for

XXX,XXX our to turn the This to payers across MA based care both and XXXX, efforts XX% executing by and providers plans. a reaching representing to growth on Now, core reflects plan beneficiaries centers collaborative of and midpoint MSO, We and and novo fee-for-service at combination member Medicare growth end of to to let members VBC the our me our organic year-end transition Advantage XXX,XXX growth continue and markets XXXX value membership. with XXXX over de Medicare guidance.

XX% We $XXX the growth $XXX revenue of to XXXX at expect million midpoint. or full million year over

as guidance, plans. As noted ups favorable consider the and the recognition revenue million run pre-Steward and impacts To annual rate of of XXXX revenues. calls. the run certain to percentage from revenues. rate, the included and QX. from the double-digit appropriate an $XXX previous We full true health business retrospective risk exiting Due membership coming assume this MSO reach growth low GAAP acquired we national of in off risk the for CareMax midpoint remainder

if contracts from GAAP external As be reach most net already MSSP, basis, risk MSO were full as lives of a yet not risk ACO in partial recognized Advantage Medicare revenues premiums. our arrangements, from primarily on costs and deducted will are provider effectively

approximately of gross towards openings, post or $XX to We our We high XXXX million This and adjusted XX% expect losses, $XX pipeline losses for fully a burdened to full at center provides pre-opening the de $XX million as year costs novo and EBITDA million approach by costs performing to MSO openings opening a midpoint. cohort. novo operating of opportunistic new continued year measured believe of take the includes plan and of losses reflected and us locations. full a we providers seed center de

and administrative MSO leverage and Finally, greater in investment the the to distributed the consistent seasonality from evenly EBITDA earnings similar accretion as core ability expect EBITDA offset revenue membership relatively de to our second second grow expenses. and we in economics the as corporate half be the the operating novo growth our throughout Adjusted roughly as reflects should year, in partially half continued Even favorable provider the first general also the this to de with year, last increased be year. over National and costs novo Florida adjusted losses. PMPM immediate half, improvement acquisition, well external between

As Carlos drive Since well the national integration collaboration teams in and With the the shared MSSP Steward AR medical toward facility. accounts with improvements and MSO provider and with will repayment underway. XXXX of utilization noted, is goals clinical to their close receivable MSO with go savings. already key engagement

year's We under increasing Advantage of to cash capital technological from risk expect our contracts. Medicare human this reinvest and new national support to the MSO taking into most flows

excited earnings execute of forward Investor demonstrate on our strategy, the Monday flow coming financial positioned prong significant the look next into unlock We national efforts on cash to going for more We and our how our and are potential detail to MSO still well to multi have drivers to Day. yours. at the

for Operator, now open we will it questions. up

Operator

And Raskin Instructions] [Operator we'll our Nephron with Joshua Research. from pick question first

open. now is line Your

Joshua Raskin

Hi, thanks. Good morning.

clarification quick get a we to Just make this sure all right.

recast $X.X the de for then from guidance? EBITDA comparable right I you in it? XXXX, novo $XX the that if losses back for preopening and know That's costs. to post up the $XX million that old reported million. million, is about slides, the I other way add So, the the $X.X think the the And opening to Is the

Carlos de Solo

Joshua. good mean, There reporting no the is right. novo. back on I EBITDA morning, from what the guidance add with doing Yeah, some Hey, now the was longer the company that we're December. of SEC sounds additionally clarifying de

We also think it makes way. it more clear this

de But novo forward moving that's without adding So, the way is back we're reporting those sure. losses.

Joshua Raskin

in reach pressure. I expected down season I external what with basis the on then added you been And ACO the that's bit XXX I MSSP don't was there And of a that's, XX. more MLR, I it bit know a guys Steward. have just came booking in points little maybe would have thought lives, would assume a sequentially below then the flu December, would have are higher little or and from

and cost if you're was what a about little I little so, And medical to that So, favorite question that the was maybe XX terms of drivers bit costs? could your the underlying expectations? a in talk the bit was is, guess you payroll seeing

Kevin Wirges

would impact of in South That's typically favorable Florida, that expectations. to a Josh, 'XX. it's we QX standpoint, I flu our from until a in note little Kevin. fill don't Hi, that came

And in so, see quarter. we'll next the that coming

arrangement talked ACO the ratio, as sharing the contracts look are partial about because risk our You risk and part, of we at MSSP there. those, deemed on

risk full in in they're really our we're there. So, calculations, anymore taking actually calculated MER not

net. revenues kind risk risk So, the medical are substantially Medicare ACO anything recorded and booking that MSSP, of partial full all even Advantage, that all contracts we and for, gross have we're being the reach, expenses

those so on lower. is the revenue And significantly therefore, PMPM

MER, during little of to only in included. of to a the our of one tell reason those expectations, those favorable a been our tend thing the believe now. how So that's to we typically, bit contracting higher due just to our the the standpoint, in obviously works. have you would more It's in one it folks came I tend which came at population MER is the has why those it It when calculation have MSO reasons growth, patients The on is been you XXXX. aren't that look side,

alone, a that we bit we're the shift higher we're just pleased But at would have in so very an of we MER. mix expected came And XX.X%. little

Operator

will our Andrew next take UBS. from Mok question And with we

Your is line open.

Andrew Mok

of below for million, new expansion XXXX? Hi, that to about guide million The million guide revenue XXXX versus think to the you good clinic your and proxy $XX built change revenue $XXX the XXXX deal help is into the think in the $XXX of clinics expectations us understand morning. previous $XXX the XX I Thanks. outlook million revenue in I filings. Can

Carlos de Solo

revenue, think glide you our the take our about risk. all I think part, when I'll Maybe about to it's path first

wanted shift not deterioration is full partial risk very, that too we put sure our that we approach, in prudent very in us have position which the to membership earnings risk, strong company's we make to a risk from as assuming guided So, a early. conservatively, to taken those, an from

I there markets. come, our revenue before XX take taking that sooner. to from depending specific a to will are elect if if months have increase but is contracts ability we risks trigger that we ability that, to in the what those favourability we have is months our you're XX So, think seeing to risk on risk period, Generally,

quarter for over to in we're there but in want opportunity getting guidance, that that that is to the definitely it we the could et favourability year, prudent the following make So, because of sure first carry cetera.

to moving of we we're sure prudent conservative make revenue taking guide that So, kind approach same just forward as want that we to

Andrew Mok

of expect for same Maybe any color? the level open to do XXXX? And just you clinics

Carlos de Solo

physicians opportunistic is Medicare still that calls in have we're but is open fact to capital members XXX can this going this we're on allow us we going going to with now have we mode, doing that we to our previous efficient very XXX the we're seated identifying so be of growth have where I've really large areas panels that to those a Well, we're in density Advantage MSO, we because call and looking at markets, in very we be how and what specific now between that those novo, and open clinics said this clinics, and de sizable open on way.

we to that our year. So, novo don't first burn those the and of physicians that exciting there's affects this think cash going we in de opportunities XXXX platform, OpEx those lot on several years have with really be a under

Andrew Mok

rate we'd where to preliminary love XXXX adjustment? your on on business relation And then notice, Thanks. minus and to impact the sit think the hear MA in risk thoughts to model X% industry your the you you

Kevin Wirges

still understand Andrew the Hi, finals there's how to going Yeah, evaluating in out. process shake is the think one letter, I call it's, to it's want we're of Kevin. initial still the

patients other a had The attributed. have this exactly year, important is new understand these growth as which very we've significant pieces to HCC it's

estimates come And so, that new get specifically we patients have. XXXX actual for will which reflect in as payment or those those HCCs suites mid-year which final final the year,

a understanding well. and specialists that additional in hospitals We as there's are them, from good of coming but HCCs have

standpoint, our that we more want that on we to all information, from to aggregate when so, And the one. make we data sure that have come

Operator

Jailendra our Truist And question with next we'll take Securities. Singh from

open. is line Your

Jailendra Singh

about will you risk convert quick lives, you upside the Thank with X/X that One XXXX. of clarification you, the I cap mentioned and into around and agreements thanks partial around Medicare question. fee-for-service I XXX,XXX some as talked for color. for guess

Was actually with of it in lives line portion there? converted? expectation? curious, variances there like any Are Just what

Carlos de Solo

think and XXXX path we're we're the we're Investor for mean, we moving Monday, to glide care convert kind to actually, membership beyond. our And XXXX, on when value-based to walk Day members I do Yeah, still in how and plan our that into arrangements. of I everybody detail of going converting to this going that's part presentation, so

the to I how there. look business that we'll expectations, move Stewart a think with on what membership. XXXX explaining But I in acquisition. going has everything also of So, we really we're forward guidance line come lot and giving in been be to the far, entire mentioned, so more And as information to kind the

Jailendra Singh

Okay. And on Andrews quick MSO. follow-up question a around

Monday, the wait? pipeline this and about future opportunity this on what you physicians about owned your is but convert typically the there? some physicians Like with affiliated think the model, we talked those How the like time can structured? I'm physicians strategy time for are MSO on As on you the might How spend convert curious, acquisitions again, do just Monday. them? under model? to over if to I've own there's evaluate you these some you

Carlos de Solo

what those Texas, in that by and all physicians on boots of a happens various on value-based tell care. all from really Florida, hearing can we're ground encouraged And ground. that lot what the So, we're is markets you Massachusetts, embracing very the of the different I

has those right the our development think work I right with, team So, the that of initial identifying right ground, all identifies the very business are on positions, and And we practices been specifically working independent the the size. and reception positive. team and panel our fit

we novo be interest lot a novo de being de hire future So, aqua our opportunities in into there new clinics. tuck-in able or of to clinics expect or to

Jailendra Singh

last a quick of Kind one.

to going a you relates of impairment color? $XX provide bit Can back the what exactly more little million. to? Like Just it goodwill

Kevin Wirges

from is component the that the As goodwill a really impairment estimate stock weeks, I'm few the heard you've biggest price. when lot of you last folks sure over

fluctuates, calculation. on XXst, a has stock price especially that and the as ended, so, And major how December it impact

the driver And so number that's of that impairment. probably goodwill one

Operator

next [Operator Instructions] take Jessica from with we Tassan question will And our Sandler. Piper

line Your open. is

Jessica Tassan

you for questions. my Hi, taking thank

of care adds And value-based year. cadence CareMax of MA like just of course those then recruitment centers de over at understand the live? the of So risk some how versus many coming roughly XX,XXX help novo conversion you from, full of the adds? Can us are of the Steward those

Kevin Wirges

Jessica Kevin. its Hi,

on cadence come a those, we'll tranche a bit January. little have the of So,

contracts. specifically our on fee-for-service contract been those conversion, Advantage As Medicare of we've know, the side, payer value-based you MSO from care national Advantage and working all flipping contracts a with partners, Medicare

us our So begin Medicare Advantage them attribute to those conversion to item. once to add line happens, them we we that and patients,

are consistent ambitions within few tell we When big side. There's say South Florida. MSO I novo growth and business, core XX our you so on the it's would or de legacy that, core I clinics thousand the from partners that those is growth have in our and payer conversions is would those with 'XX. a our providers amount bulk, fee-for-service. converting the 'XX that contract opening and going significant be to and membership working open of But and in a coming also

Jessica Tassan

Got different of then MSO. given of you patients just versus center what it. going looks the And platform kind base clarify forward that going mix MA to the contribution are like?

Kevin Wirges

Yes, it’s it's a way around great question. MSO have historically looking for synergy that Obviously, I'm XX%. not contribution that have Obviously, XX% it standpoint, typically we're an the something typically around and From sure some we at the the contribution answer high performing, platform we've MER, we into. closer a I specifically, we'll just But is the yet. and But platform standpoint, something there's from to that from platform a to think XX% big performing evaluating, high let synergy standpoint. a XX. we're a they're But know. getting think similar. are in you is the where I that legacy contribution definitely looked variation XX

Carlos de Solo

different that but away some margins of about for you'll as and too I you to the give mature as Investor much lines think medical we on see And think assume 'XX. presentation Yeah, but of business. about not Day in 'XX guidance the

that into kind information some as back have well. of you So,

Jessica Tassan

of whether for moved like on fee risk. just can full many my in patients my Thank one many a And with deciding think And Stewart will you should CareMax? of of kind centers provider be you, the Steward service are provider of the or these guys. into or from how decisions explain then kind basis, built of standalone by or went how those and is just XX about last And you are collaboration made year-to-date, being about built which how how identifying and that? are we just opened

Carlos de Solo

that Sorry, of question, last, repeat the can Jessica? beginning the you

Jessica Tassan

in Yeah, with Stewart spends the of in maybe standalone full how collaboration going built of will be vendors? year-to-date? for And the year how that's many those CareMax up? kind then to geographies many be And

Carlos de Solo

a Yeah, as going opportunistic about new I not be think, guide the question centers, answered think when think before, to I the number. we're we to we're because I to going on specific

the to of is by the as will identify the that is we about be opportunity, existing So, de opportunity you majority our the markets. tell membership, or intent I on Florida and can What clinics additional to different membership which really MSO all. our the that novo novo open de clinics seated we open we and added all in various with from MSO the business, either think

Operator

And question with our next Taylor we'll take Cowen. from Gary

open. Your line is

Gary Taylor

good the seems in the Hi, you're kind the wondering on thinking it ups free XXXX from XQ from give cash ops I morning. if and be about some you of color cash what which flow? loss was there to larger and just cash

Kevin Wirges

Kevin. Yeah. it's Gary, Hey,

in receiving payment. is, So, standpoint, MSSP there's components delay one think that our cash as from you about flow, of look at obviously a the leading that we an always

doesn't on So, the but 'XX. bit, MSSP side hitting of we the, obviously be really receivable, pay will this XXXX, but the accounts be what earn a QX essentially about Those accruing. talked on until will call government that little we for the

get and is larger. larger And continue to to so receivable that going

As of to are cash going operating year, Those core those de this and projections, about our to most flow them losses novo centers we that but continue. during perform, flow late of cash ever this are business continues year. or late we have think this opened do year, kind

If losses XXXX. operating always you about, remember into continue talked that J-curve will that those we've

And going be cash which so, on drag anticipated. we a to there's

in the this, components of think we're like it's be we cash point, a when that as of MSSP that is cash payment of really, we kind of will flow breakeven about think the positive. I so, at QX think we kind point, XXXX comes and And position is flow where what really

lag know, a that sooner. the if to how even Medicare Medicare be we only paid there's would similar about meeting, Then you it's a three- forward forward, from way other to little our four-month it probably plans. know pays, we Advantage break or will Going meaning MSSP Advantage think is payment pushed

our of a now. it's a so, a little business bit drag. causing And of a just little such delay, of bit amount and material there's a cash It's

deploy a really we because making all year, over how year side, bit those be to why really didn't we flow we that to prudent to And very going capital specifically. and prepared to reinvesting need just MSO the risk we're we're and is next cash burden. we reinvesting invest, of want getting know It's fees that, MA from sure we're that a those be the also but take on really this why that's the little

Gary Taylor

that, AR that lot is growth collected the or all 'XX in that attributed be XQ that XQ, of So, most maybe in largely to then? the of think I Steward, receivable, a would

Carlos de Solo

'XX. that, probably MSSP. would Steward collectible, of QX But around not of and close prepaid an specifically But are all million $XX the the facility that be remember, of bulk that AR there have or yes, an But receivables, owed where funds is collected those we those. store. where into also to we, in so The we add entered is we technically AR that facility that to

AR funds go back sense? that we facility took out. pay those to essentially, so Does that going make And to that are

Kevin Wirges

receive the XXXX, is the the The MSSP XXXX. two think in in of payment of way last platform we XXXX, actually data the about months in service that to will QX actually best owned Yes. it, Gary

years, two XXXX rather went QX the positive payments and So, cash of you're just flow and a sooner. years kind lag that's two cash of just potentially the almost than into looking why of even at Kevin really under flow year really a and

Gary Taylor

to full think physician Florida for this don't you the or settlement maybe mean, just to could how change some understand gained year. groups, back I maybe for particularly patients But model it or risk go that you a be minute, some. risk the to important I on yours, 'XX, because have you've I really it's want impact seems that but that have, I of not Okay.

But been see the certainly, take is. sort risk new your run can you've population, and it to able what you impact score the model of through

any before that, is sweeps CMS worse national even those that final, indication Is or sort than promulgated? average and that So you X% settlements. negative final better that there of look

Carlos de Solo

that. still going was the Yes, I say, to of we're process in evaluating

you. priority important for other the think I process

is, going going is or or this CMS X% there's that there's to understand to that includes of also I I'm going risk, think normalization. be be, the other to important the what some piece impact

to for two understand exactly adjuster. what's that's ultimately, things need that average, fee-for-service the our segment that those need understand, patients. we what we out So, when But means we to really national

of that's first So the step. kind

think to be health new the be bid, you is acuity this they as bids. has population methodology. a which of step other how think normalized about have I bids Those plans the build using and recast to the X.X the their under to

rebates, how flexibility And their bids. they And AB there's attribute, did at to goes be what build going health in so, on they're what to plans going how the into some X.X. the to

going have. And some the there, are there's ultimately wiggle plans health room to with from

we we're impact impact, from whatever still So, and medical standpoint, still Whatever also top a side. the impact is impact line evaluating. think again, there's evaluating. on We're the some that offsetting expense

Gary Taylor

right. setting when part just make wanted That’s the is that also bids. that calculation Yes. point of that the to I clear rescoring

some be what extent to going is that don't there yet. think don't of potential we I relief to So, know is, we the

Carlos de Solo

thank Okay, you.

Operator

Instructions] [Operator Jefferies. take question we Brian Tanquilut next will our with from And

open. is Your line

Brian Tanquilut

and going guys. integration, about yesterday but you're Hi, and lay know we Carlos, good Monday, out I then and around of the the strategizing that. to as a think things Stewart, morning, lot on

milestone least And XX you're can on for like to months us success to hitting Just next XX the we're maybe thinking that Stewart. the if the share right, kind say, with we're about that our we're you of the okay, right for path. hitting at

Carlos de Solo

all about integration, the when the on talk we're membership about the some am it's going I on on And going to already specifically we and to ground, of down talk that, think to Monday. I the going things we've that to Yeah, boots done. think boil

lot to advantage come and Most as more value-based going it's to actually integrating there. detail making process begun. already potential arbitrage. care has technology the that agreements or So, we well. of done all But a those be sure really Negotiating our that of been have already took workflows,

Advantage And from full arrangements. we able probably and in to positively then be So, quickly the schedule to fee of these from going Medicare finally, it's then we're risk very, impact value-based into moving membership partial how of an Medicare how can memberships make additionally, some to risk And service areas. ahead tracking very we're the Advantage quickly transition really to for care.

to to at I contracts as we risk of meaning to earlier, XX-month discretion have our path mentioned But go that earlier. And also elect with our risk an glide the majority are negotiated into we time. XX can

So, there than is execute some wiggle the and revenue earnings room for once expected. sooner favourability, both on the we're to if then able

in are just full-time dedicated XX we've that are the on we folks, really a metrics the of integration. those So deployed And looking employees, new a brought we're lot at. focus Steward that

on working So, ground, of to physician right physician making identifying have the folks the physician we provider sure those provider with to leaders. that amount

to So, be everything to schedule we're has a more done, really But and of lot lot right work been that, work seems be now. ahead a done. excited of

Brian Tanquilut

I if learning your Memphis model New prepared you in what markets, of us, into York others. share remarks, with and then, the the obviously talked and expansions appreciate markets portability can Florida. about you that. in guys the among the And Maybe you new outside of

with can those a today Just Thanks. like performing? If look us. and anything share there's they're how you what clinics

Carlos de Solo

Yeah, again, well. as we're exceeding expectations

true already New such opportunity. value-based any we mean, isn't just seven density we're it's medical with we're And have systems over There excited. really like York, care really huge XXXX I centers. delivery ours. a patients,

is I and you you Florida. deal to the So, with in opportunity there competition think have the that huge same don't have

really think those we've be actually Florida. here really going we're we outside it outcomes in to how we're Memphis but a our New we behavior, of a And impact where and ability encouraged And well. the as to of physicians to patient lot attention educating by is lot better which successfully, of environment Florida, a so focus really is practice in ways and we've portability easier create on well the easier, it of care many been putting in York communities. were as value-based as then So seen the that the in arguably and to in most what doing and ways, successful really in

Operator

no are there And further questions at this time.

call So, back closing for to Carlos I will now remarks. Solo de turn the

Carlos de Solo

And We to year for on of and we strategy value day Steward the all your all on call We're drive seeing and great execute significant acquisition. shareholders continued benefits investor our I'd believe for we Monday as thank ahead you our growth a like the will joining to for we today and in day. work look for long-term excited at Have support. the increased stakeholders. you and realize So, Miami. forward sustainable to our Thanks again. the

Operator

we for you participation. concludes gentlemen, and conference And and thank your this ladies today's call

disconnect. You may now

CareMax (CMAXQ) 9 Mar 232022 Q4 Earnings call transcript