Q1 2021 Tivity Health Inc Earnings Call
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[music].
Good day and thank you for standing by welcome to the T V. P Health Q1, 2021 earnings conference call at this time of Mr.
The listen only mode. After the speaker's presentation, there will be a question and answer session to ask a question. During the session you will need the press star one on your telephone if you require any further assistance. Please press Star then zero.
Please be advised that today's conference is being recorded.
And the like to hand, the conference over to your speaker of today, Matt and Atlanta, which vice President of Investor Relations. Thank you. Please go ahead.
Good afternoon, and welcome to the activity Health first quarter 2021 financial results Conference call.
Before we begin if you do not already have a copy of the first quarter earnings release supplemental information and related 8-K filed with the SEC are available on our website activity health Dot Com I would also like to highlight that our financial presentation within today's press release and.
And supplemental materials are reflective of the divestiture of the nutrition segment. Therefore, all results of operations related to that business are now reported within discontinued operations.
To the extent any non-GAAP financial measure is discussed in today's call. You will also find a reconciliation of that measure to.
For the most directly comparable financial measure calculated in accordance with GAAP in today's news release, which is also posted on the company's website.
This conference call may contain forward looking statements within the meaning of the private Securities Litigation Reform Act of 1995 <unk>.
Including statements among others regarding Tivoli health expected quarterly and annual operating and financial performance for 2021 and beyond.
For this purpose any statements made during this call that are not statements of historical fact may be deemed to be forward looking statements.
Without limiting the foregoing the words believes anticipates plans expects and similar expressions are intended to identify forward looking statements.
You are hereby cautioned that these statements may be affected by the important factors among others set forth and pivot health filings with the Securities and Exchange Commission and in today's news release, and consequently, actual operations and results may differ materially from the results discussed and the forward looking statements. The company undertakes no obligation to.
Outdated publicly any forward looking statements, whether as a result of new information future events or otherwise and now I'll turn the call over to the company's president and CEO Richard Ashworth.
Good afternoon, and thanks, Matt. Thank you all for joining the call today to discuss <unk> health first quarter earnings results. Joining me on the call is Adam Holland, our CFO and Tommy Lewis, Our C O O and Matt <unk>, our new VP of IR.
And as you saw in today's press release, we reported strong results for the first quarter of 2021 with revenues of $108 $1 million and adjusted EBITDA from continuing operations of $41 $2 million.
As a result, we are increasing our revenue guidance range to 40 465 million to $485 million and our adjusted EBITDA guidance range to $151 million to $155 million.
Touching on a few highlights our silversneakers in person gym visits continued to gain momentum throughout Q1 and grew 19% over the fourth quarter of 2022 of $11 2 million visits and <unk>.
Additionally, our Q1 virtual silversneakers visits increased by 50% over Q4 of 2020 totaling one 2 million visits reflecting continued robust demand for our silversneakers branded classes and proprietary content and our balance sheet and leverage ratio continued to improve during Q1 with net debt of 353.
Bringing our leverage ratio to 211 at the end of the quarter.
During the quarter, we prepaid $64 million of principal and amortization of term loan debt, meaning our next amortization payment is not due until December of 2020 two.
Last year, we dedicated ourselves to positioning the company for profitable growth with a focus on delivering differentiated value to members clients and shareholders and that growth is underway. Our silversneakers business is gaining momentum and reflected and strong operational performance during Q1 and raising of 2021 guidance. We're also meeting.
<unk> milestones and our strategy to become the modern destination for healthy living and I'm pleased to share of key highlights with you on today's call I'll.
I'll begin my remarks, with an operational update for the quarter and then discuss progress against our strategy sales.
We're sneakers represented 74% of our first quarter total revenue and as mentioned earlier, our first quarter visit trends for both in person and live virtual and substantially improved as compared to Q4.
Silversneakers live virtual visits continued to accelerate increasing 50% and the first quarter compared to Q4 with 36% of our Q1 virtual visits representing new participants. This puts us on track to deliver our goal of more than 4 million live virtual visits for 2021, there is a growing demand.
And then for convenient high quality live digital engagement inside our membership base and our continued growth and participants and visits plus our member surveys tell us a clear story that our silversneakers members desire of curated and focused experiences Silversneakers provides one of the best platforms for members to Engie.
Our breadth of live offerings that are easy to use high variety and ever changing and fun. We now offer over 13000 distinct alive at the instructor events every month targeting different audiences with varying fitness levels and specific needs are on demand library now contains over 220 videos, including nutritional.
And other enrichment content important to members and we continue to add new content every month.
As a result of our member research and January we increased the number of live virtual classes, while further expanding available class times for Silversneakers members. This ensures our members will always have choices of content and availability of live classes, when and how they want them.
Importantly, we also expanded our national classes with a greater variety of targeted specialized silversneakers formats.
Our silversneakers national and structures have become some of our most important brand ambassadors and many of generated significant followings, which help activate new silversneakers members. The one of the best marketing channels available word of mouth and finally, we're launching of new live virtual personal training program for Silversneakers members and we are very excited about this unique engagement.
<unk> and how it can help our members live better lives by targeting the specific needs and goals.
And as the impact of COVID-19, 19, subsides and the world of fitness and more members returned to our physical gym network. We believe our Silversneakers digital offerings will continue to be and important and growing part of their engagement experience.
Turning to and person Silversneakers performance, our gym network and other partner locations continue to gain momentum as in person visits grew by 19% over Q4 to $11 2 million visits as we moved through Q1, we saw an increase in both the number of members returning to the gym and an increase and the number of visits.
Our gym and participating location network remain robust and we ended the first quarter of 2021 with approximately 16000. The silversneakers locations. This is in line with where we started the year.
As the immunizations and confidence levels improve especially among older adults, we anticipate and acceleration of in person visits through the remainder of 2021.
A recent survey data indicated that over 90% of Silversneakers members had received at least one dose of the COVID-19 vaccine as recently as April the same cohort indicated a strong desire to return to in person and silversneakers fitness experiences, including the gym and community fitness once it was deemed safe to do so.
We believe with the continued momentum of the vaccination rollout and the gradual removal of Jim restrictions Silversneakers is on track to achieve and annual in person visit goal for 2021.
Our renewal and new sales season for Silversneakers is also underway are key renewals, including those among our top 10 customer base are progressing as expected and we are seeing some early success with plans who are adding the silversneakers benefit for the very first time our objective over the next few months is to continue to engage existing and potential.
New clients to secure long term contracts for 2022 and beyond and also expand the number of markets for those plans offer the silversneakers benefit the.
Aside from our new virtual offerings, and social engagement capabilities, which I'll touch on and just the minute. The core of Silversneakers offering continues to show a strong ROI for our clients just.
Just recently, we engaged Avalere health to use real world data and analytics to create and independent evidence based study on the value of the Silversneakers program related to health care utilization health outcomes and health care costs.
The objective of this research was to quantify the value of the Silversneakers program from both a cost and overall health improvement perspective.
Members of the same chronic illnesses as many other seniors, including high blood pressure high cholesterol and diabetes. However, the Avalere study revealed they also engage and healthier behaviors beyond just exercise, including keeping up with their routine medical appointments going to screenings and taking medication to manage their conditions and the results of.
The independent research concluded that the total cost of medical care for Silversneakers participant with 16% lower than for non participants funding has also included improvements to medication adherence adherence and areas directly tied to plan and star ratings are participants are healthier they are happier and they require less medical care the member.
Who do not participate in the program. This further highlights the importance and urgency of our work to increase engagement and utilization among our silversneakers eligible members as well as alignment with our health plans, who appreciate the validation of these outcomes.
Moving on to Prime this business accounted for 21% of total Q1 revenue and we ended the quarter with approximately 12500 partner locations similar to where we began the year. We ended the first quarter with 220000 active prime subscribers slightly higher than where we ended 2020.
We anticipate our subscriber base to range between 202 hundred 10000 and for the remainder of 2021 and believe it will give us a good launching point to start rebuilding subscribers in 2022.
Our first quarter of prime visits increased sequentially by 24% to $3 1 million visits from two 5 million and Q4 also on the higher side of our expectations, our prime subscribers with an average user age and their early Forty's are returning to in person gym visits at utilization rates nearing pre co.
And with levels, which highlights the demand for our unique product that incorporates one of the largest physical Jim networks and the United States.
Our focus for the remainder of 2021 will be to deploy new digital features within prime which we believe will broaden and further differentiate our value to subscribers and our plan and partners.
And these new features will include and expanded catalog of digital fitness videos and resources plus new live virtual instructor format.
Our commercial insurance and large employer relationships for prime are healthy our gym network is robust and durable and we believe the growth opportunity in this area is attractive over the long term I look forward to updating you on our progress.
Moving onto our strategy update we are expanding beyond day, Jim access company into a member focused data driven platform engagement company with omni channel capabilities. Our objective is to engage members through our trusted 30 years Silversneakers brand and to do so beyond physical fitness utilizing new tools new data and.
New experiences fundamentally will be of member centric company to meet member needs and leverage our market, leading brand as well as digital and in person assets capabilities and expertise the backbone of our strategy will be our new engagement platform, enabling us to develop a personalized data driven set of experiences for our members custom.
<unk> to their interest needs behavioral profile and goals all of the way that maximizes value for our clients and benefits for our members. Our members will experience the platform to multiple mediums, including a new and smarter website and Silversneakers app backed by AI enabled proprietary segmentation and state of the art Omni channel technology.
In essence, the engagement platform will be a means to diversify revenue beyond our historical core fitness and Jim access offering. The good example is the new product within our digital transformation strategy called Silversneakers connect which allows members to connect socially through a dedicated platform either virtually or in person our analysis shows that this.
Type of connection reduces loneliness and social isolation of among our participating population. We're currently engaged.
Gauging and discussions with our health plan partners on this unique benefit for members. Additionally, we have recently launched a pilot with a well known partner and nutrition counseling and the enrichment under this pilot participants of access to one on one nutritional counseling mental enrichment and other personalized content that targets the specific conditions using of state of the art Hepa and <unk>.
<unk> App, we believe nutrition is an important part of addressing the underlying chronic conditions of our silversneakers membership base and examples such as this pilot could lead to new commercial offerings, and both whole health living and our wisely well brands.
The pilot among others as part of the new test and learn discipline to extend our relationship with payers of new ways and identify opportunities within our additional network strategy, which could support up to 'twenty two traditional and expanded supplemental benefits offered under Medicare advantage, we have made meaningful progress over the last 60 days towards launching our new engagement platform later.
This year, while there may be some element of investment that could include acquisitions. We don't believe the investments will meaningfully move our leverage ratio and importantly, we've recently announced the addition of two new executives here of Richardson as our new Chief Information Officer, and Stacy Santo as our new Chief experience and innovation officer, both executives brings significant expertise and <unk>.
The care and in fitness, Sarah will lead the delivery of the digital engagement platform and the expansion of our customer relationship management tools and data strategy Stacie will lead innovation initiatives, including the implementation of data driven marketing strategies platforms and programs a robust voice of customer program and the development of new product and service.
<unk> I am confident that the addition of these hires to our already strong management team will ensure we continue to hit our milestones and create new and diversified revenue streams for activity health in 2022 and.
In conclusion, the fundamentals of our business are strong and we have exciting growth opportunities ahead of us as more individuals age into Medicare and the demand for high quality of engagement will only increase our 2021 guidance reflects a year over year growth and both revenue and adjusted EBITDA and our healthy balance sheet affords us the financial flexibility needed to access.
The rate of our growth and I'm confident we will leverage our market, leading silversneakers brand as well as our digital and in person assets capabilities and expertise to bring more value to our members our clients and our shareholders and now I'll turn the call over to Adam.
Thank you Richard.
Today, we reported adjusted EBITDA of one of $41 $2 million and increase of 36% over last year, reflecting a solid start to the year.
Additionally, we ended the first quarter and a strong liquidity position as evidenced by our cash on hand of $52 $4 million and leverage ratio of 211 times.
Now turning to the first quarter revenue from continuing operations revenues for the first quarter were $108 1 million.
Silversneakers revenue was in line with our expectations at approximately $80 million down compared to the same period last year due to fewer revenue generating visits as a result of COVID-19.
Similar to last quarter Silversneakers revenue profile during the first quarter of 2021 was different from the same period last year.
Revenue from per member per month fees represented 53% of our total silversneakers revenue compared to 36% and the same period last year.
We expect this percentage to decline as we move through 2020, one and generate more member visits as part of our overall revenue mix.
We ended the quarter with $17 6 million health plan members eligible for Silversneakers and increase of 9% over March 31 2020.
And on track to meet our goal of approximately 18 million eligible members by the end of the year through monthly agents.
Total silversneakers visits were $12 4 million during the first quarter of 2021 compared to $25 3 million for the same period last year.
With monthly average participation of two 9% compared to seven 9% last year.
Within the $12 4 million visits one 2 million visits were live virtual with instructor.
And importantly, the average number of times our members go to the gym per month increased by 24% compared to the same period last year.
And now the prime we generated $22 $6 million of revenue in Q1, we ended the quarter with 220000 active prime subscribers compared to 344000 subscribers at the end of the first quarter and 2020.
The subscriber decline accounted for the majority of the year over year revenue decline.
We had approximately $3 1 million gym visits from prime and Q1 of 2021 compared to $4 7 billion and the prior year period.
For whole health living during Q1, we recognized $5 $6 million and revenue a slight increase to last year.
Turning to our Q1 2021 balance sheet and cash flow. We ended the quarter with cash on hand of $52 million and term loan debt of $405 million with the leverage ratio of 211 times well below the maximum ratio of 525 times as calculated under our credit.
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As Richard mentioned during the first quarter, we prepaid $64 million of principal and amortization of term loan debt, meaning our next amortization payment is not due until December of 2020 two.
Now turning to guidance.
We raised our full year guidance and our earnings release and supplemental materials. This afternoon.
We now expect total revenue to range between $465 million and $485 million and adjusted EBITDA from continuing operations to range between $151 million and $155 million.
We increased the lower end of the revenue and adjusted EBITDA ranges as a result of better than expected silversneakers visits and a larger average prime subscriber base.
As our membership base returns to the gym for both Silversneakers and Prime we anticipate total company gross margin percentage to decrease from Q1 2021 levels.
Our guidance also reflects an increase and operating expenses in Q2, and Q3 relative to Q1 levels, which relates to our omni channel initiatives.
Finally, and our updated 2000 and finally, our updated 2021 guidance.
Does not reflect any impact of the potential change and the value of our ownership and share of care.
As a reminder, we hold approximately 159000 shares of share of care stock as a result of selling our population health business to them and 2016.
The shares are currently reflected at of carrying value of $10 $8 billion and other assets on our balance sheet.
Share care has announced that they are emerging with Falcon capital acquisition Corp, which is described and Falcons 8-K.
From an accounting standpoint, if and when the share of care stock starts trading we will begin recording these chairs at their fair value in accordance with U S GAAP and recognize any gains or losses through the income statement.
There can be no assurance that the share of care transaction will will move forward.
What valuation of our shares will have or when we will sell our shares if the transaction does occur.
In closing, we will continue to consciously managed our operating cost structure to support both operations and strategy to maximize our earnings and cash flow capability in 2021 and beyond.
On the balance sheet, we have a strong liquidity position and we will continue to evaluate our capital structure as well as our capital allocation philosophy.
Due to the strong leverage loan market conditions, we will be exploring and opportunistic refinancing of our credit facilities to reduce interest expense and lower amortization and extend maturities.
And as a reminder, it remains our intention to maintain a leverage ratio of below three <unk> times as we grow the business through both organic investment and potential M&A opportunities.
I'll now turn the call back over to Richard Richard.
And you Adam I appreciate your time and attention and I'll turn it back over the moderator to take your questions.
And ladies and gentlemen, if you would like to ask a question first star one on your telephone and again, if you would like to ask a question best ARP one on your telephone and webcast for this moment to compile the Q&A Boston.
Okay.
For our first question you had Steve.
For from.
Cantor Fitzgerald, Steve Your line is open.
Hi, Thank you two questions.
In terms of in person.
Utilization.
Do you still expect debt number to be.
Sort of gradually ramp to 70% by year end because that was the.
The expectation after the last quarter.
Thanks, Dave. Thank you are good to hear from you of good. Good question I'll start and then Tom you. Adam If you went away and but short answer to that is yes, we still see in person is coming back strongly and what we're seeing recently is and in line with that plan and so we're still expecting that amount you saw and the and the update on the guidance, we had a little bit of an uptick and the number of in person visits.
And what you can see and the chart that we put in the supplemental materials and and the release, but.
None of the Tommy Adam anything you want to add.
We saw a nice inflection point in March and we were happy with the April results as well as as markets begin to open up we're seeing people go back to the genome and and.
And it's yet to be determined what.
The seasonality factors take place this summer as people begin to travel and things of that nature, but we're very optimistic about the return to the gym.
And then when you think about some of your.
Renewal discussions.
How has virtual.
Moved into sort of the pricing realm.
On those renewals.
Yes, good question and Steve So first off I mean virtual is becoming a very core part of the discussion. So I think it's the it's becoming it and accepted way for our population to engage giving them that optionality of go into of Jim or we're in there and the comfort of their home or of course, our community aspects in terms of the pricing I would say that it and.
And Tom you can weigh in here, but overall, it's been fairly commensurate with what we've seen so far around virtual and the value proposition of virtual is very strong when it's backed by a very large gym network. It becomes pretty compelling anything you want to add.
Yes, the payers appreciate what we're doing related to virtual we're bringing on new members that hadn't engaged and the gym previously and they like the engagement they like the activity and.
And so great value proposition, our default position is that the physical at the NGL and pricing and the virtual is the same and we're not really getting a lot of pushback on that.
Great. So.
As this rolls out right the economics stay the same or actually improve.
As you add more functionality to the platform and theory correct.
Yes, I would think the.
At the broadest point, yes, I think and the short term of the scale and size of that digital is not net.
Near of what our in person visit locations are but we are pleased with the growth for getting a consistent engagement just two other things and I think are important about this to your point of view of the digital platform, 36% of our virtual participants are brand new to silversneakers, they've been eligible but they haven't participated.
The pre COVID-19 or in person knew.
Participants was tracking around 18%. So we're getting almost double of the new activation through the digital channel and as we add more content and as we offer more services and experiences I would expect that.
Become a more compelling channel for our for our membership base.
Great. Thank you.
I appreciate it.
For our next question, we have joint venture of Zhang from Credit Suisse. Your line is open.
Hey, Good afternoon, guys. This is carlos on behalf of Gilenya I have two questions for you for.
First one is you guys talked about the focus of the new CIO and <unk> was.
I'm wondering if you could elaborate more on the change and focus and priorities with respect to those digital and innovative offerings and with the new hires at the company and second question also noticed gross margin for Q1 were 47% you guys do anticipate that gradually stepping down to the mid 30 per cent range and the back half of 'twenty one.
Yes, Thanks, Carlos I appreciate it Richard I'll start off and then Adam if you want and take the gross margin question for the for the <unk>.
And what's good about the both of these executives coming on board is the significance of their background, having having experience and almost startup environment, having experience with very large fitness companies, having experienced and very large health plans.
The.
Robust health care services companies and having a lot of digital experience.
And with what we were looking for.
And both of these roles to come and accelerate and to continue the strategic outlined that we gave a couple of months back and so we just feel really good that both of these executives who are now here with us and I can tell you, we're up and running for sure.
Levering of lot of value already, but giving fresh perspective on ways to solve.
For for some of our member needs and wants as it relates to our platform. So just really excited about their background and the the pace that they're going to bring for us.
Adam you want to take gross margin yeah. So we pointed out the gross margin percentage of it is expected to go down and what drives that as you have more visits not all of our visits as you remember Carlos of revenue generating visits Prime as an example of that RP and PM Silversneakers members and other example of that so as those increase youre going to have more visits more costs and.
And that's going to drive for your percentage down back to more historical levels. It's hard to say, if we're gonna get all the way back to the pre COVID-19 historical norm of 30%. This year. It all really depends on the speed of the of the return of normal I think with what we've guided to is kind of 70% of pre COVID-19 by the very end of this year.
We probably won't get back there all the way this year and it's probably going to be into 2022, but directionally. It's what we want to see and we're happy to see the business return as fast as they have.
Okay. Thanks.
Thanks Carlos.
For the next question, we have Sean Wieland from Piper Sandler Sean Your line is open.
Hi, Thank you very much I'd like to learn a little bit more about engagement levels on the virtual visits so beyond the actual number of total overhaul of virtual visits and how do you measure of engagement at the individual level, maybe frequency or watch time, and what are the strategies in place to really drive engagement.
Hey, John This is Tom and Greg Great question, and what we're seeing so far is that our average visits per participant for virtual is actually higher than than the physical so the people that are participating and really like the experience and they like the convenience of the time slot for it and they liked the instructors and so they're actually.
Attending more of which is good for the member good for US good for the health plan.
And in terms of what we're doing too.
To enhance that engagement.
There are a number of things that we do we have a.
A waterfall type of marketing and strategy, if you will where we communicate with those members we advise them on on the upcoming schedule if there.
If they like a particular and structure, we will provide and content related to the instructor will give them a lot of great content and a lot of great information and we're continuing and a digital format and we continually too.
<unk> to communicate with them to try to nurture of that relationship and get them to come back and the new technology that we're investing in that you heard us talk about last quarter related to our consumer data platform or our new martech capabilities are coming online. This summer that will give us.
Even greater ability to do precision communications and messaging and ideally continue to increase engagement levels.
Is it.
And typically for the members of either or kind of thing or they either use done in person or.
Virtual or is it the combination right now and what we're seeing is they are really sticking to a single modality. So if.
If the.
They preferred the gem roofing and and stick with the genome with the mid single digit crossover rate right now.
And that that will continue and that will increase over time for example, when we had weather issues back in February we did some proactive communication to encourage the gym goers.
Virtual classes and that worked out pretty well. So we would expect the crossover rates to continue and the future and so we really want to leave it up to the members to attend whichever type of session. They like whether it's in the community, whether it's virtual or and the GM, but we believe that our efforts will will raise utilization across the board because of.
We have a variety of options and so and I think the the other good point here is as we can get more people to engage with us virtually no. There is a kind of and upfront process right to get them in and once we get them over that line based off of how they participate more frequently and how they are stickier I think over time, we're going to see a large a larger number of people who will.
The kind of go back and forth, but so far it's been pretty single modality, where you know if they like the gym. They go that way and if they like the digital day stick with it too.
And last question I promise this is.
Can you tell us what the margin differential is between merchant and the gross margin level between virtual and in person.
Well I can't give you the exact percentage.
Obviously, there's a different cost structure involved and.
It can't come in at a higher margin depending on the format. We have we have several of the performance of the live classes the <unk>.
The most popular our Silversneakers live classes, which is a large audience almost day peloton type experience with the national instructor and and the second class is a what we call. The flex live which is a and more intimate group may be the group that you may.
And maybe done your classes were down the street at your local gym.
10 of 15 people in your local and structure of done online because of the gyms closed or the restrictions or inclement weather and so we'll be working through the different models I mean, we're going to.
Offer what the members want and and that's what's going to drive us first versus what has higher margin and a lower margin, but the important thing as Tommy mentioned is that we are engaging new members. We're tracking new data on these members that are helpful to the plans and the members and we're excited about where this can go.
And that's super helpful. Thank you.
Sean.
And we have time for one last question and it's from Ryan Daniels from William Blair Bryan Your line's open.
Hey, guys and the XP got it and for Ryan. Thanks for taking my question I guess, the kind of follow up on Sean's line.
As you move more and more into this kind of a little bit of virtual here, a little bit of physical there and more kind of omni channel fitness offering how do you guys envision that affecting <unk>.
P M P.
And I was thinking of you move more into these different offerings.
And you would shift a little bit of away from the visit fee and have a larger chunk of that would be more of a P. M. P. M right, but I guess, how are you guys thinking about that.
And Nick it's a good question.
I'll just start off with where we're very flexible so how our plans want to engage with US commercially we're very open to that.
<unk> versus the fixed.
Fee or some hybrid of the two are very open for that we'd like to be in alignment with the plan on our behavior. What we really want is to be the mono destination for healthy living and help people get is physically fit and active and socially connected and mentally enriched as they can.
And so as we're doing that and now we've got this virtual and digital capability, which is proving to be enthusiastically responded too.
I would think that because of engagement percentage and the type of touch points and number we have go up could we see.
The shift in and the way that payers think about how to commercially engage with us we could.
My point would be no problem with that.
We're really excited about engaging more people and we want the the months of economics to of course work for us, but we also wanted to work for the plan and ultimately we just want the numbers more engaged so it's a good question I don't know the answer two of yet it's a little too far out what we're seeing right. Now is a lot of our plans are sticking with whatever commercial construct they had before so you know we're going through renewal season now we're not seeing.
And any seismic shift and the way that we're contracting with them everything seems to be pretty consistent with past history, obviously COVID-19 two of.
The curve ball for everybody.
But our plans are seeing more and more longer term on their member health and are really appreciating the difference that silversneakers makes not only on the health side as we announced with the Avalere study, but also.
And the importance for the Medicare advantage offerings. So good question time will tell but we're pretty open and flexible to the different a different construct.
Great. Thanks.
Helpful Color, and then I guess kind of shifting gears, a little bit the virtual personal training and kind of future seems pretty interesting what are the plans to monetize that and I can see something where someone goes into the gym.
Net pay to swipe and then its an extra service that they have on their phone and what the virtual training and so set while they are in the channel by themselves. How do you guys kind of envision that.
It takes the place yes. Good question. Thank you.
It's almost and one way it's like what you are used to and gyms, but with the with a kicker of benefit. So unexplained. So right now you've got a gym membership and that doesn't usually include personal training right and maybe you get one or two free but then you.
And you pay for some some specific sessions.
That'll be similar here, so that the construct to get access to Silversneakers and the live one on one personal training is a top up if you will.
The planned Ken can fund for but the kicker would be that it is in concert and in partnership with the plan. So as someone has a specific need more clinical or health care related need. So maybe they got discharged from physical therapy, but still need some more core of training and some more strength training or maybe they need some help with fall prevent.
<unk>.
Does the at higher risk and then we can work in concert with the plan to enable the personal training for that remember that that is done through very specific curated proprietary engagement of our senior fitness instructors and so thats. The unique differences that yes, it's one on one like normal personal training, but the goals of very health oriented.
And in concert with the plan.
Thanks, guys very helpful color I appreciate taking the questions.
And I appreciate it thank you.
Yeah.
The centers be Jones of any further questions you may continue.
Well, we just want to thank you for your time very good questions as usual and I appreciate your time and attention and everyone have a good rest of the evening.
Ladies and gentlemen, this concludes today's conference call. Thank you all for participating you may now disconnect.
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