Q2 2021 Universal Health Services Inc Earnings Call

And good day, and thank you for standing by and welcome to the Universal Health services second quarter, 2020.1 earnings conference call. At this time all participants are in a listen only mode. After the speaker presentation. There will be a question and answer session to ask a question. During this session you will need to press star 1 on your telephone.

And I would now like to hand, the conference over to Steve Filton CFO. Please go ahead Sir.

Thank you and good morning, Mark Miller is also joining us this morning, and we welcome you to this review of Universal Health services results for the second quarter ended June 32021.

During the conference call.

Using words, such as believes expects anticipates estimates and similar words that represent forecasts projections and forward looking statements.

I recommend a careful reading of the section on risk factors and forward looking statements and risk factors and our form 10-K for the year ended December 31, and 2020 and are for.

We will be and Q for the quarter ended March 31 and 2021.

We'd like to highlight just a couple of developments and business trends before opening the call up for questions.

As discussed in our press release last night and the company reported net income attributable to uhm per diluted share of $3.79.

Fourth quarter of 2021 after adjusting for the impact of the items reflected on the supplemental schedule is included with the press release, our adjusted net income attributable to uhm per diluted share was $3.76 for the quarter ended June 32021.

And last nights press release, we identified.

3 specific items, including supplemental, Kentucky, Medicaid reimbursements and increase to our self insured professional and general liability reserves and the receipt of insurance proceeds on a combined basis. These items had a net favorable impact on after tax earnings of approximately $30 million during the second.

For the February 2021.

EBIT, if 1 chooses to ignore the favorable impact entirely our earnings during the quarter still exceeded our internal forecast by a wide margin.

For most of the second quarter, we experienced a continued decline and the number of COVID-19 patients being treated and our hospitals.

And a corresponding recovery and the number of non COVID-19 patients as a result, most of our key volume metrics, including acute and behavioral patient days emergency room visits and surgical cases grew to levels approaching those that we were tracking before the pandemic began.

This robust Rick.

Recovery and volumes exceeded the pace of our original forecast and drove the favorable operating results even in the face of continuing labor pressures and both of our business segments.

Our cash generated from operating activities was $119 million during the second quarter of 2020, 1 as compared.

And to 1 for $5 billion during the same period and 2020.

The decline and cash provided by operating activities was driven by the previously announced early repayment of $695 million of Medicare accelerated payments, which were received by us during 2020 and repaid to the government during the first quarter.

<unk> 2021.

We spent $482 million on capital expenditures during the first 6 months of 2021.

At June 32021, our ratio of debt to total capitalization declined to 35, 7% as compared to 38, 3% at June 30.

'twenty.

As previously announced we resumed our share repurchase program in the second quarter of 2021 after suspending it in April 2020, as the Covid volume surge for the first time.

During the second quarter of 2021, we repurchased approximately $2.2 1 million shares.

2000, and an aggregate cost of $350 million and yesterday, our board of directors authorized a 1 point or $1 billion increase to our stock repurchase program, leaving $1.2 billion remaining authorization.

We were extremely pleased with our second quarter 2021 operating.

<unk> results, which we noted we are well ahead of our internal forecast as a consequence, we also raised our full year earnings guidance, including and approximately 6% to 8% increase and our full year forecasted adjusted EBITDA.

I would note that during the past 4 to 6 weeks many of our hospitals.

And have experienced significant surges and the number of COVID-19 patients and it is not evident that this surge has yet reached its peak.

Given the uncertain impact of this most recent surge on non COVID-19 volumes and on labor shortages, we based our guidance for the second half of the year, primarily on our original.

Internal forecast.

Mark and I would be pleased to answer your questions at this time.

And as a reminder, if you'd like to ask a question simply press star followed by the number 1 on your telephone keypad again that is star 1 for any questions. Our first question will come from the line of Kevin Fischbeck with Bank of America.

Great. Thanks, just wanted to follow up.

And the <unk>.

Labor issue and it seems like a lot of companies are talking about.

And the difficulty in getting staff.

And I guess really interested mostly on the sites and that's been kind of a gating factor for growth for you guys. What are you.

Now how do you expect that to play out over the next debt.

Next year or so.

Sure.

Kevin We've certainly discussed that for.

For some time and I think we felt like.

And before the pandemic began that the labor situation and our behavioral hospitals had largely.

Seeing July from some other challenges, we've been having and the years before.

Obviously, the onset of the pandemic sort of exacerbated and kind of created new challenges in terms of finding sufficient numbers of therapists and nurses and and mental health technicians, who are nonprofessionals.

For a variety of reasons competition from telehealth providers for therapists.

<unk>, who are either burn out or.

Contracting the virus or quarantine and because they've been exposed to the virus or.

Technip mental health technicians, who we were competing.

And with <unk>.

Employers like Amazon and Fedex with so a whole bunch of challenges I think during the pandemic again, I think as the pandemic eased and.

And from its peaks early this year I think the labor situation had been improving and I think you saw that in Q2 with sequential improvement and our.

And.

And just a sort of a general stabilization of the behavioral business and obviously as I mentioned in my remarks, we've seen an uptick and COVID-19 patients and the last 4 to 6 weeks I think it's a little too early to tell.

What sort of impact that's going to have on our ability to fill all of our open.

Our volume of positions.

And that's why as I can.

And I made commented in my prepared remarks, we've been a little bit cautious about our guidance and the back half of the year.

Okay that makes sense and I guess, maybe just a little more color on the site.

Volume improvements I guess, you've got a different number different service lines and so like any.

Okay and at all.

Returning uniformly or something better than others.

It's very geographic specific number 1 and cabin I mean, I think it really depends about the competitive environment and the market.

So we have some markets, where it is frankly, not an issue and others, where it's a significant issue.

And they all say that again.

And you know.

May June July we will see.

Setting internal records for how many people we were hiring at all levels.

As a result of some very focused activity on our part to.

Increase our recruitment activities et cetera.

We're also focusing a great deal on increasing retention rates for those people, we do hire but again express some level of caution and concern with the rise in and.

And COVID-19 volumes and the last month or so only because every other time, we've seen an increase in COVID-19 patients and it does create.

And exact exacerbated pressure on those.

Labor issues.

And it means is that the question and it looks like Youre cycling down and I guess, the Universal 2019, and that's the right way to think about it and when do you think you can get back to.

And those levels.

Yeah I mean.

And I think as we've commented.

Many times over the course of the pandemic.

Underlying demand by sort of every way that we measure it for behavioral care is as strong as it was pre pandemic and quite frankly, probably stronger whether we measure that based on inbound inquiries calls internet.

Parties et cetera.

The amount of patients that were required to deflect because we don't have beds and we don't have.

And sufficient staff et cetera. Every every indicator that we have both on a sort of a macro and industry wide basis, and a micro uhf's basis indicates that.

Net income the demand is still growing as I indicated I think we felt that as the pandemic you used a lot of those pressures were easing not not necessarily disappearing by any stretch, but easing we didn't have nurses warrant is burn out and nurses werent chasing those premium dollars.

Interest.

It just became easier to hire and to retain people. So I think that the COVID-19 resurgence makes that a bit more challenging but ultimately we have a view that these shortages are temporary and transient in nature and when they get resolved, which I think will happen as the pandemic eases over.

Time.

We will be able to get back to pre pandemic volumes and ultimately exceed pre pandemic volumes.

Thank you.

Your next question will come from the line of Joshua Raskin with Nephron research.

Hi, Good morning. This is mark go on.

Josh and thanks for taking the question and I was wondering if you could just provide a bit more detail on the the cadence of volumes through through the quarter relative to the pre COVID-19 baseline and would also appreciate some color on the trends you're seeing through July and our thoughts around what is baked into guidance.

And for the second half of the year. Thanks.

Sure So I think.

We commented and Q1.

And we reached the peak of our Covid levels.

Third wave of Covid patients with sort of in late December 2020, and into January of 2021 and those were.

For <unk> COVID-19 levels, and almost all of our hospitals that we had experienced during the pandemic.

And say beginning in the second half of January and then pretty steadily from there COVID-19 volumes declined and non COVID-19 volumes have recovered and rebounded and as I indicated.

And again in my prepared remarks to the point that.

And at the time, we exited Q2.

For most of our volume metrics, we work back to sort of pre pandemic and and we're sort of using 2019 as our measure of pre pandemic levels of volumes and.

And I also indicated we've seen.

Covid patient surge again, beginning in very late June and certainly well into July and they don't appear to have peaked now what I will say is that our operators seem to be managing through this.

And fourth wave of Covid.

Effectively.

We certainly haven't seen a.

Our financial result, since the Covid surge has resumed but just from a volume metric perspective, we don't see that level of decline and things like elective surgeries.

Or other activity that we've seen with other COVID-19 searches and I think our operators are just.

And so much.

And we're accustomed to dealing with this all of the sort of gating factors that had proved problematic and earlier surgery is lack of PPE lack of beds lack of ventilators those things at least at the moment don't exist. So you know we're coping much better I do think probably the single biggest issue we will have.

Much with the resumption of Covid is just exacerbated pressure on labor every time that COVID-19.

Frequency has increased there's been more and more pressure on labor and.

And that's tough to measure and I think we know that we're using you know more.

Temporary labor and July.

But what the ultimate impact of that will be we'll have to play out but at least so far through July.

We seem to be coping reasonably well, however, as I indicated again and my prepared remarks.

Because we are sort of uncertain as to how this plays out and what the cadence will be we've been cautious and having.

And I assumed that our financial results will exceed our internal forecast and the back half of the year the way they did in Q2 and.

And we've just sort of presume that will will meet our original guidance for the back half of the year for the most part.

Great. Thank you.

Okay.

And the next question will come from the line of Ralph Giacobbe with Citi.

Great. Thanks, Good morning, Steve can you talk a little bit more about utilization by payer you know just across commercial and Medicare and Medicaid and and also if you're seeing differences and acuity, but team between them is well beyond sort of utilization.

And I think what.

Second quarter results.

Or are emblematic of and you know I think this is seems to have been true for at least our too.

Acute care public peers, who also have already reported this quarter.

Is that there is very.

For a bowl mix of patients.

As Covid has declined.

And and the non Covid patients have recovered the payer mix of those patients and skewed to commercial and Medicare.

And we're seeing and a lot of our markets fewer Medicaid and uninsured patients.

And we're seeing higher acuity of the patients. We are treating we've said I think from the beginning that.

The patients who sort of.

And reluctant to come to the hospitals driving softer emergency room activity et cetera tend to be lower acuity Medicaid uninsured patients.

And so that mix, obviously is reflected albeit and lower volumes and higher revenue per unit per day per adjusted admission per adjusted patient day on both the acute and the behavioral side and and.

And increased earning so so I think that's been.

You know a general.

A positive development and so positive that quite frankly has.

Outweighed and even and I think arguably overwhelmed the increase labor pressure that we've experienced.

And now again I'll caution that we may see a different dynamic in Q3 with higher levels.

<unk> COVID-19 patients the mix may not be quite as favorable but I think it was very favorable in Q2.

Okay, Alright, that's helpful. And then I was hoping you could help frame you know what what you are seeing specific to Covid, maybe just baseline at first what percentage of what percentage of admissions were.

For Covid in the second quarter, and then obviously you obviously talked about the increase and just the last kind of few weeks was hoping to get sort of a quantification of what percentage of admissions and you've seen of late that are COVID-19 off the baseline. Thanks.

Yeah, So I think and the second quarter.

The percentage of Covid.

Admissions to overall admissions had dropped into the sort of mid single digits.

I think throughout the pandemic and our average had been more like the low double digits, 12, and 13% and I think at its peak.

And let's say January of 2021, or the first half of January 2021.

We were at that maybe 20% of our admissions were COVID-19.

Our COVID-19 volumes today.

Similar to what they were a year ago and the sort of June June July timeframe from a year ago, which again I would suggest we're in sort of the low.

No.

Double digits percentage, you know 10, 11, and 12% of our overall admissions so not near the peak of where we were in January but either close to or exceeding where we were in the second wave last summer.

Okay. That's helpful. Thank you.

Your next question will.

Will come from the line of Peter Chickering with Deutsche Bank.

Yeah.

They are getting closer.

For the 2018 levels, but not there yet.

For the back half for years, so we'd be thinking about admissions accelerating sequentially from here and exiting the year at.

And then 18 levels for fourth quarter.

So Peter I think our point of view was when we gave our original 'twenty 'twenty 1 guidance.

We had.

Our point of view about and declining cash.

And for Covid patients and frequency of Covid patients and of cars.

For both my recovery and non Covid volumes I think that the fact of the matter is and I think our second quarter results reflect is that the decline and COVID-19 patients was more rapid than we originally anticipated.

And the recovery of non Covid business was also correspondingly more rapid and.

And honestly it led to our second quarter results that were well ahead of our expectations.

I think as we think about now the second half of the year again, the most recent COVID-19 for sort of complicates that and I don't know that where any of us are.

And really insightful enough to know exactly how that will affect.

Affect the ultimate trajectory for the rest of the year, but I think we have a point of view that some of the catch up and recovery of those deferred procedures et cetera were realized in the second quarter.

And then maybe we had anticipated would occur later in the year and so I think we were thinking about a little bit more seasonality and the back half of the year.

<unk>.

So I think you know for instance is as I look at the Street estimates I think the street was projecting just steady improvement and volumes throughout the year, which was sort of defy the traditional.

And as analogy and at the beginning of the year that seemed to make some sense, but I think now that we've had such a strong.

Strong second quarter.

I'm presuming that the Covid volumes decline.

Relatively soon I think we think the second half for the year will look a little more seasonal and traditional seasonally then and maybe we expected originally.

Fair enough and then on behavioral margins.

And the increased 100 basis.

Sequentially, you have to pull out and $55 million from Kentucky, I guess, how should we think about behavioral margins progression throughout the year and can you walk us through that sort of the hires and June and July and how would you. How would you think about hiring versus top line growth versus margins. Thanks. So much.

Yeah, I think that a lot.

A lot of.

Behavioral and the strength and behavioral and the increase in margins that you alluded to is being driven by strong price.

Pricing or revenue per adjusted day and.

And we've talked about that.

Quite a bit and the last few quarters I think it's driven by the lower.

At this point denials less uninsured patients.

And a number of other things including <unk>.

And <unk>.

Rice negotiated price increases with some of our managed care payers, particularly our managed Medicaid payers.

It's been a little bit difficult to sort of predict how sustain.

And level above those levels are I think some of that improvement is based on a little bit less rigorous utilization management behavior on the part of payers and I think there was a view that at some point.

Emerge from the pandemic.

And the payers would become standard.

And more.

Sustain sort of other than they had been during the pandemic, we will see how that occurs but I think we have a point of view that.

As pricing moderates some.

And our volumes will recover continue to recover and that's really based on the labor sort of dynamics that you talked about and.

Again, I mentioned that.

For granted.

Seeing from our own internal perspective, very impressive hiring numbers for the last few months what is difficult to measure and real time is exactly.

And how our turnover rates are doing for a while I think they have stabilized the concern is with the research.

And we've been and Covid that turnover rates could increase because we've seen turnover rates increase every time that COVID-19 volumes increase so that's the piece, that's a little bit difficult to.

Peg with with precision.

Great. Thanks, so much.

Your next question will come from the line and Jamie personally.

Research and.

Hey, good morning, guys I wanted to start with EBITDA and just thinking about 2022, and given where your guidance items for the rest of this year or are you thinking about the longer term growth of EBITDA again, just given.

And where you're going to exit this year.

And we're still units for 2022.

So I think our point of view is.

Is that.

The underlying fundamentals of both of these businesses have not really changed in any significant way and.

And the way that we've always thought about the long term model for both of these businesses is that they could and should grow from a top line perspective, and the mid single digit range for 567% and.

And all other things being equal if you were able to achieve that.

That EBITDA growth would.

Meet or exceed that and margins would expand et cetera.

Because this is still a largely fixed and semi fixed cost business.

During the pandemic.

And that sort of traditional model was significantly disrupted.

Because of it.

And.

You know and overemphasis on Covid patients, who tend to be sicker and less profitable.

And a decline and non Covid business.

And with patients tend to be more profitable.

But I think our point of view and again, we're not smart enough to know exactly what the cadence.

And it's and frequency of the Covid patients, who is going to be but I think our longer term point of view was as the COVID-19 volumes declined and again I think Q2 was a perfect example of this.

And we took a return to kind of a more normalized model.

And where.

Volume growth was and the low.

And youll digit pricing growth was and a low single digits on a combined basis revenue growth was in the mid single digit EBITDA and EBITDA was growing margins were expanding etcetera and I think.

At this point, that's how we think about 2022.

With the sort of caveat that.

Low think we presume that 2022 will be a relatively.

Quiet year from a COVID-19 perspective, but you know that's probably you know more helpful than anything else at this point.

Okay, and Thats really helpful and then share repo and dividend and obviously both back now and just how are you thinking about other lines of capital deployment.

And specifically M&A and just your.

The interest level, there and what youre seeing out there and the market. Thank you.

Sure and Mark and certainly weighing on this subject as well, but I think we have.

Total net interest level I don't think our interest level and M&A has declined I think somebody asked mark for questions.

And specifically and the first quarter call and he talked about the fact that we.

Continue to look at and explore and perform diligence on a whole host of opportunities in both business segments.

At the end of the day.

Other than some relatively small opportunities, which we.

We pursued and things like.

Micro hospitals, and freestanding emergency departments et cetera that we've acquired.

You know these are these are transactions and 40 $50.60 million range individual transactions, there really hasnt been.

Real significant opportunities of size.

Although we continue to explore them and and would pursue them if they made economic sense and more compelling from a financial return perspective.

And the absence of those opportunities.

And <unk>.

I think the second quarter was a good example of this.

Became a more aggressive acquirer of our own shares.

And for buying back our share is even with sort.

The strong recovery and our share price.

In Q2, we're buying back our share is arguably somewhere and maybe they have 9.5 times EBITDA range and honestly.

And we're hard pressed to find an opportunity to buy externally.

And on the EBITDA at those same multiples. So we view the opportunity to buyback our own shares as still pretty compelling.

And I think we'll continue to do so and we.

Our original guidance for 2021 was that we would buy back $750 million worth and stock over the 3 quarters.

And we bought back $3.50, and Q2. So we're obviously you know ahead of that pace.

Alright I appreciate it thank you.

Your next question will come from the line and Frank Morgan with RBC capital markets.

Good morning.

Steve wanted to go back to the hiring on the behavioral side.

And out of the business it.

It sounds like you've had some success there, but where are you now versus what you actually need and what would that translate into in terms of incremental capacity to bring on more volumes.

Yeah.

So Frank it's a great question I mean, I think we have a point of view.

And that if we could wave a magic line and higher all of the staff that we need again it for therapists nurse tech levels.

Our volumes would exceed alcohol on a pre pandemic baseline our 2019 volumes.

Mid single digits at least I think that day.

And the demand is sufficiently they add debt that would be the case.

Want to leave the impression that you know obviously, we don't have a magic wand and Theyre just instead of lot of hard work that remains to be done and focus.

But I think we have a point of view that and.

These things are these issues and these obstacles.

Goals are.

Overcome a bowl if that's a word and we will.

We will.

These targets, especially again as the virus received obviously the the frequency of the virus.

And the sort of multifactorial kinds of pressures that puts.

And libraries for 1 thing that as you as you might imagine dose and it completely out of our control. There's nothing we can do about that.

But.

We don't believe the virus and the last forever.

And we believe that as it proceeds.

It'll become much easier for us to meet our hiring and retention targets.

And I think fundamentally we believe that demand will return to not only pre pandemic levels, but will be growing.

And the way that I described and model earlier somebody you know by mid single digits every year.

Above pre pandemic levels.

Got you and maybe going back to your.

Got it and you called out Youre thinking more of a seasonal pattern, but it could could you help us maybe if you had to give a waiting and attribution for the second half of the year is it are you thinking maybe 40% of the balance of the year will occur and the third quarter and 60% and the fourth of any kind of color in terms of waiting over.

Over the second half of the year and then are there any incremental buybacks is included in that guidance.

Yes, I mean, we made this point and Q1, which is I think uhm has very intentionally not ever given quarterly guidance and.

And I said.

Said.

If it was every year when I think we would never have changed that practice and be more precise I think this was the year and still believe that.

Obviously, some of the cadence and some of the trajectory as this year and much harder to predict and than ever before.

And we'll say and I think I referenced this in and earlier.

And that is because I looked at the street estimates for the year. It just seem like.

They were a little heavy and the fourth quarter compared to what our expectations were and I think that's because I'm really not being critical.

The street and creating their expectations for the year sort of ignored the normal seasonal patterns said volumes would continue.

And you're kind of cover because you had all this pent up demand et cetera, I think we have a point of view that because volumes have recovered earlier than our expectations a lot of it and it became front and loaded you see that and the Q2 results not only for us, but our peers.

The fourth quarter will be you'll have some other more seasonal softness that.

And we've seen historically because of the holidays et cetera. So that that's the only observation I'd make about.

And the cadence and particularly the streets.

Trajectory for the balance of the year.

Got you 1 last 1 and I'll hop just in terms of the Covid surge you have experienced.

Any particular.

And as you've called out certainly we've read about Vegas, but.

And as Vegas, the biggest source or any color on any other day.

Thanks.

And so on the acute side.

I think we've all read that states that haven't seen a significant increase include Texas, and Florida, and Nevada and Unfortunately.

From an acute perspective and that probably covers.

3 quarters of our acute care revenue, so we're seeing that increase and and all of our markets, but I think probably Vegas is the most acute at the moment.

And then on the behavioral side, it's pretty spread out I mean, we do have.

And again, a pretty big presence in Florida.

Geography, and Texas from a behavioral perspective, we have some hospitals and Missouri, which has been.

Kind of a focal point of the COVID-19 resurgence et cetera, So we're feeling that pinch and a number of different markets on the behavioral side as well.

Okay. Thank you.

Your next question will come from the line.

The line of Matt Borsch with BMO capital markets.

Good morning, you have been filling in for Matt Borsch. Thanks for taking my question, So I would like to touch upon price transparency.

And with the announcement of the proposed rule to increased fines for hospitals I was just wondering how your team plans to handle compliance.

Florida is possible changes going forward.

So we have a point of view that our hospitals have been compliant with the right price.

Price transparency regulations since January 1 of this year when they originally went into effect.

Occasionally we will.

Clients, we critiqued by users or other groups, who sort of kind of tested and we will say that you know they have difficulty navigating a certain piece et cetera, and we make tweaks to it but.

And we very much feel that we currently comply and we will continue to comply.

Excellent. Thank you.

And once again for any questions Press Star 1 and your next question comes from the line of a J rice with credit Suisse.

Hi, everybody.

First of all.

With respect to the change.

Change and reserves.

Would you recorded.

And the second quarter can you.

Was that a little bit is that part of our normal review process was that and unusual update and does that have any impact on go forward accruals.

Sure a J so the nature of the malpractice reserves.

And as such that we conduct.

We have a third party actuary conduct and in depth actuarial analysis twice.

And twice a year.

So this was part of our you know kind of mid year review of that.

Net reserve and and the nature. Unfortunately, other malpractice reserves, because they have such a long tail.

Cases are often being settled.

607, and are even more years from there.

Actual occurrence.

It's probably the single most.

Difficult kind of accounting estimate that we make and there's probably subject to the most change I think what our.

Our actuary reported to us.

And the current period.

And we I think affirmed with a number of other outside.

Service and this area is that.

The general trend in the country is for not necessarily more frequent malpractice cases.

But more severe and more sort of you know dollar intensive cases, and thats been our experience as well so given that.

Those results.

They determined that we needed it and.

Increase and our reserves, we concurred, we recorded that we'll record I think.

A relatively small increase and our provision for malpractice going forward I don't think that will have more than 10.

And 10% to $20 million impact and.

And you will be going forward and obviously, we'll continue to do these.

<unk> annual detailed reviews by the actuary.

But that's the color behind that.

Okay and then the other question I was going to ask you talked a little bit about different aspects of <unk>.

What youre seeing on the commercial side, but.

It's just there and update on where you're at and re contracting is that happening.

And a normal.

Normal pace for this year next year and beyond.

And any change and what youre seeing in terms of rate increases or in terms of terms of all the.

The value based off and so forth anything.

There, that's new or different that youre seeing.

No I think the.

The reality is that commercial.

Managed care contracts.

Continued to be.

Administered contract and negotiated throughout the pandemic.

Honestly I don't know that and that all those sorts of negotiations were held in.

And 1 person or face to face historically, so I don't think that changed a great deal during the pandemic I did note earlier and have noted and I think in previous call that.

And we really made a concerted effort, particularly on the managed Medicaid side of the behavioral business.

2.

And.

And negotiate price increases that in some cases, we haven't had for years and I think that's helped to drive that really strong and behavioral pricing that we've experienced throughout the pandemic. So that's the.

The 1 change that I would.

Highlight and suggest is certainly sustainable.

But other than that and other.

Other than again, and I think a comment that I've made before that our managed care payers, particularly on the behavioral side seem to have been a little bit more lenient on utilization management and denials and length of stay during the pandemic.

I think broadly we havent seen huge changes.

And our relationships with managed care payers.

Payers on either the acute behavioral side.

And just maybe a final thing on the public exchange.

Volume, we're hearing some obviously theres growth again.

No.

This year with the changes and subsidies and the changes and the extended period of enrollment has debt.

And with the needle I'm, assuming you book that and commercial and if I'm right.

Yeah, so sometimes it's difficult to identify.

And what.

Patients have and actual exchange product etcetera, but what I do think and I.

This again and in an earlier comment is despite all the economic disruption.

And particularly in the beginning of the pandemic people, losing their jobs, having reduced hours etcetera, we didn't see the accompanying increase and rates upon insureds the way that we have and previous sort of economic downturns.

And I attribute some of that to the fact.

Obviously, the ACA was in place and so for instance, and a state like Nevada, where we've seen a significant amount of.

And a weakness in the gaming industry again, particularly early in the pandemic.

And.

And we've seen an uptick and Medicaid utilization and I think that's generally been a good thing because I think these people would have been.

Sure. The other then.

And being able to fall back on expanded Medicaid benefit so that sort of thing I think has been helpful. I think the presence of the ACA Medicaid expansion and some of our important states like California and Nevada.

Yeah.

Greater ease in terms of being able to acquire commercial exchange.

On the buybacks I think all that's been helpful to keep that better payer mix that we seem to be experiencing and our peers seem to be experiencing during the pandemic.

Okay. Thanks, a lot.

We have no further questions at this time I will turn the conference back over to management.

Okay, we just like to thank everybody.

Body for their time and look forward to speaking with everybody again next quarter.

Ladies and gentlemen that will conclude today's call. Thank you all for joining you may now disconnect.

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And.

And.

[music].

Yes.

Yes.

[music].

Okay.

And then.

And.

[music].

And then.

[music].