Q1 2023 Encompass Health Corp Earnings Call
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Good morning, everyone and welcome to encompass Health's first quarter 2023 earnings conference call.
At this time I would like to inform all participants that their lines will be in a listen only mode.
After the Speakers' remarks, there will be a question and answer period. If you would like to ask a question. During this time. Please press star one on your telephone keypad, you will be limited to one question and one follow up question.
Today's conference is being recorded.
Like if you have any objections you may disconnect at this time.
And now I'll turn the call over to Mark Miller encompass Health's, Chief Investor Relations Officer.
Thank you operator, and good morning, everyone. Thank you for joining encompass health's first quarter 2023 earnings call before we begin if you do not already have a copy the first quarter earnings release supplemental information and related form 8-K filed with the SEC are.
<unk> on our website at encompass health Dot com.
On page two of the supplemental information you will find the safe Harbor statements, which are also set forth in greater detail on the last page of the earnings release during the call. We will make forward looking statements, which are subject to risks and uncertainties many of which are beyond our control.
Certain risks and uncertainties like those relating to regulatory developments as well as volume bad debts, and labor cost trends that could cause actual results to differ materially from our projections estimates and expectations are discussed in the company's SEC filings, including the earnings release.
And related form 8-K.
The Form 10-K for the year ended December 31, 2022 and the Form 10-Q for the quarter ended March 31, 2023, one filed we encourage you to read them.
You are cautioned not to place undue reliance on the estimates projections guidance and other forward looking information presented which are based on current estimates of future events and speak only as of today we.
We do not undertake a duty to update these forward looking statements are supplemental information and discussion on this call will include certain non-GAAP financial measures for such measures reconciliation to the most directly comparable GAAP measure is.
<unk> at the end of the supplemental information at the end of the earnings release and as part of the form 8-K filed yesterday with the SEC all of which are available on our website I would like to remind everyone that we will adhere to the one question and one follow up question rule to allow everyone to submit a question.
If you have additional questions. Please feel free to put yourself back into queue.
With that I'll turn the call over to Mark Tarr encompass Health's, President and Chief Executive Officer. Thank you Mark and good morning, everyone.
Very pleased with our first quarter results, which once again exhibited strong volume growth and substantial year over year improvement in labor costs are.
Our first quarter revenues increased nine 5% and adjusted EBITDA increased 17, 5%.
Demand for our services remains strong and we have continued to invest in capacity additions to meet the needs of patients requiring inpatient rehabilitation services we.
We opened three new logos in the first quarter and our fourth de Novo earlier this month.
Adding a total of 199 beds.
Over the balance of the year, we plan to open three more de novo's and add 93 beds to existing hospitals.
Our fitchburg, which costs and de Novo originally scheduled to open in Q4 of this year has been moved to Q1 2024 due to weather related construction delays.
We continue to build and maintain an active pipeline of de novo projects.
With wholly owned and joint ventures with acute care hospitals. We currently have 18 de novo's underdevelopment with opening dates beyond 2023.
This pipeline includes Danbury, Connecticut for which we recently received approval for a certificate of need.
Barry will be our first hospital in the state of Connecticut, and we look forward to providing high quality services to patients in this market.
During Q1, we again met the increasing demand for our services, while reducing contract labor and sign on and ship, calling us expenditures.
Direct labor was down approximately $21 million or 51% from Q1 2022, while sign on and ship bonuses decreased approximately $5 million or 23% from Q1 of 2022.
On a sequential basis contract labor and sign on and ship bonus expenditures were similar to Q4 of 2022.
As compared to Q4 contract labor rates were lower Ftes increased primarily due to higher patient volumes.
Our talent acquisition efforts resulted in 54 same store net new Orient hires in Q1.
Earlier this month CMS issued the 2024 <unk> proposed rule.
This included a net market basket update of 3%, which we estimate would result in a two 9% increase for our herbs beginning October one of 2023.
Our final rule is expected to be released in late July or early August .
We're continuing to invest in our hospital based technology through initiatives like our tableau onsite dialysis rollout.
We now offer in house dialysis, and 64 of our hospitals and we will continue the rollout in 2023.
Reducing our reliance on third party providers and obviating patient transport to receive this service leads to fewer disruptions to therapy schedules and improved patient outcomes and satisfaction.
On site dialysis via Tableau also reduces our costs for these services.
Moving now to guidance, we are increasing our guidance for 2023.
We now expect net operating revenue of $4 seven to $4 $77 billion.
Adjusted EBITDA of 872 $910 million and adjusted earnings per share of.
$2 94 to $3 23.
The key considerations underlying our guidance can be found on page 12 of the supplemental slides.
Finally, I want to remind investors that we are planning to host an investor day in New York City on September 27th 2023.
At that meeting we will provide more detailed insights into key elements of our strategy, including de Novo hospitals clinical technologies and labor management.
Mark Your calendars for September 27 details will follow in the days ahead, we hope to see you there now.
Now I'll turn it over to Doug for some further color on quarter.
Thank you Mark and good morning, everyone. As Mark stated we were very pleased with our Q1 results.
Revenue for the quarter increased nine 5% over the prior year to 1.1 dollars 6 billion and adjusted EBITDA increased 17, 5% to $229 million.
We continued to see strong volume growth in Q1 total discharges grew nine 4% and same store discharge is grew five 9%.
As we've mentioned previously in the summer of 2021, when the clinical labor market began tightening in contract labor and shipped bonus is starting to rise we made the strategic decision to continue staffing our hospitals at levels sufficient to accommodate the increasing demand from earth appropriate patients.
Even when it required premium cost labor to do so.
We are persistent and this approach, thereby allowing our hospitals to provide value to our patients referral sources and payors.
As a result, our value proposition continues to resonate and we are experiencing gains in market share.
As Mark noted, we made significant improvement in year over year labor cost in Q1.
Our Q1 contract labor plus diamond ship bonuses of $37 million was comprised of $27 million in contract labor and $16 3 million and sign on and shipped bonuses.
Contract Labor in Q1 declined approximately $21 2 million or 51% from Q1 of 2022.
Agency rates declined year over year and sequentially.
Our Q1 2023 agency rate per FTE was 183000 down from 240000 in Q1 of 2022 and 211000 in Q4 of 2022.
We expected rates to moderate from Q4, once we got past the premium pay associated with holiday shifts.
The reduction in rates as a favorable sign and indicates the overall market for contract labor has improved.
We are optimistic that the end of the public health emergency next month and with it the cessation of the Covid stipend paid to acute care hospitals will inject further discipline into the market.
Yeah.
We indicated previously seasonality of our business and capacity growth via new hospitals and bed expansions could lead to a sequential increase in contract labor Ftes in Q1 of 'twenty three and that is what we experienced.
Our contract Labor Ftes increased from 325 in December to 520 in March this was attributable to volume growth and seasonality.
As evidence of our progress in managing contract labor in March of this year, we had 230 fewer contract labor ftes than in March 2022 against an increase of 395 in our average daily census.
We believe that the level of contract labor expense, we experienced in Q1 represents an approximate quarterly run rate for the balance of 2023.
This does not represent the height of our aspirations and we will maintain our focus on further reducing contract labor Ftes and expense.
Sign on and shift bonuses decreased $4 8 million or 23% from Q1 of 2022 and increased modestly sequentially.
We also believe that Q1 sign on and shipped bonus expense represents a reasonable quarterly run rate expectation for the rest of 2023.
Revenue reserves related to bad debt as a percent of revenue increased 20 basis points to two 4%.
We experienced increased pre and post payment claims review activity during the quarter.
In addition to <unk> T. P. CMS recently initiated an audit program using supplemental medical review contractors, where smirks.
Under this program.
MFS as authorized <unk> to conduct widespread post payment reviews of Earth claims with dates of service from March of 2020 through December of 2020.
Under the Smirk audit program, we have thus far received approximately 1000 record request at 30 locations totaling approximately 21 $21 million in claims.
To date, we have received initial results on 11 of these locations and the results have been favorable.
Of the approximately $8 8 million in claims covered by these results approximately 78% have already been approved without being subject to another lever of level of appeal.
While the results results. So far have been favorable we are still objecting to the time period of this review the initial phase of the public health emergency.
And to the interpretations of medical necessity criteria, serving as the basis for denying claims.
As has been the case with prior audits, we remain confident in the clinical judgment supporting the admission of patients into our hospitals as well as with the Voracity and thoroughness of required documentation.
<unk> for the quarter was 332, an increase from three to eight in Q1 of 2022.
<unk> is typically lower in the first quarter due to higher volumes.
Our guidance assumes <unk> to be approximately $3 four O for Q2 through Q4 of this year.
Q1 de Novo net preopening and ramp up costs totaled $4 $2 million and we continue to expect $10 million to $12 million of these costs for the full year.
Finally, we ended Q1 with a net leverage ratio of three one times down from three four at the end of 2022.
And with that we'll open the lines for Q&A.
Yeah.
At this time, if you would like to ask a question. Please press star one on your telephone keypad again that is star one on your telephone keypad. Please note you'll be limited to one question and one follow up question.
Thank you.
We'll take a question from Kevin Fischbeck of Bank of America. Your line is open.
Hello, Kevin.
Hello, Great. Thanks, Good morning, So I just wanted to dig into some of your labor comments, because obviously your guidance you raised.
The wait out working youre looking for contracts that sign on bonuses to kind of be.
Similar from here through the rest of the year. It seems like most of the other companies seem to be talking about.
The modest improvement in these metrics as the year goes on so just love to hear a little bit about why.
You have to wait to get a little worse and why youre not expecting improvement in that.
Yes, Kevin I think we would point to a couple of things. One is I think we have made more progress on a relative basis and perhaps some of our peers and I think we've also been exhibiting higher volume growth.
Adding more capacity to our base. So those things do factor in want to reiterate a comment I made in my in my prepared comments, there, which is those expectations do not represent the height of our aspiration. So we're going to continue to focus on opportunities to make improvement in those levels, maybe just shine a bit of a brighter light on the <unk>.
All of improvement that we made on a year over year basis in Q1.
If you look at Q1 of 'twenty three.
With an average of 459 contract labor Ftes that comprised one 8% of our total ftes.
Compare that to Q1, a year ago, where we had an average of 706 ftes.
That was two 9% of our total ftes for the quarter and the rate dropped from 240000 to 182000.
The most recent kind of accurate.
Or normalized <unk>.
In Paris, and we can have us all the way back to 2019, and so we look at the full year of 2019, we had contract labor Ftes that were about 9% of our total FTE workforce. So we're not back to that level, yet and we're not sure that we'll get all the way there, but we have made substantial progress.
Yes over the last year, it's obviously a huge focus for our operating teams and they are exhibiting a great deal of disappointment terms of.
Managing those extra shift bonuses in the amount that they are having to pay for <unk> ship bonuses or the sign on.
Our new staff and I also wanted to.
Spreads to focus we have right now on retention of our existing employees. So.
Not only on reducing our contract labor, but once we do bring on new nurses are other staff, we're very focused on making sure that we are.
Focusing on the details that it takes to bring them on Orient them.
And have an equal amount of focus on the retention aspects to make sure that we get staffing where we wanted in the contract labor in the premium costs down as low as we can.
And we saw the evidence of that in the first quarter with our nursing turnover dropping below 25% and our therapy turnover, which has always been low below 8%.
Okay. That's helpful.
And then I guess on volumes.
Compared to the debate about how strong volume actually our services.
Easy comps are disrupted Q1 last year do you have any color about how volumes progressed through the quarter was being very very trusted and there are stronger this year year over year or whether it's travel throughout any any color about kind of what you think maybe drove some of the volume outperformance. Thanks.
Yes, Kevin we saw pretty consistent volume growth throughout the quarter and it was not only throughout the quarter, but we.
We saw nice growth in all eight of our geographic regions. So I <unk>.
Very pleased with the progress we've made there I think if you consider what the driving aspects of that are.
I don't have to look any further than our quality indicators, our ability to get patients back home our ability to to keep the number of patients that go back to the acute care hospitals as low as it can be and as well as those that gets sent to a skilled nursing facility, but I do think that the work our teams have done in separating themselves based upon.
Our quality outcomes.
New proposition continues to resonate with the payers and referral sources.
And is assisting our growth going forward.
I think what was really encouraging about the quarter was just how broad based the growth was for us geographically across the patient makes spectrum across payers as well to provide some specifics there. If you look at our two major payer categories for the quarter Medicare advantage was up 20% and over 17% on the <unk>.
Same store basis, and Medicare was up 9%.
It'll basis and nearly 5%.
<unk> store basis.
We saw growth in every one of our major categories of patient mix and what we did say it was one of the factors that impacted pricing for the quarter is that we saw growth in stroke and neurological but every other patient category grew faster and to us that's an important signal that more normally.
<unk> flows are occurring throughout the entire health care system.
Yes.
Thank you we will take our next question from Andrew Mok of UBS. Your line is open.
Andrew.
Hi, good morning, very strong volumes in the quarter, but pricing yield was flat year over year can you help us understand or walk us through any items impacting rates beyond the sequestration impact.
Yeah. So there were a number of items sequestration is certainly a significant one we called out that there was a $7 million net negative adjustment related to the Ssi adjustment factor. It was $2 $5 million positive in Q1 of last year and it went the other way on us to the tune of $4 five.
In Q1.
This year.
Bad debt expense for reasons I've discussed in my prepared remarks, we're up about 20 basis points, but a bigger factor is one that I was just pointing to which was the change in the patient mix and so you really had two things going on there first as you may recall that although we didn't get the same 20% stipend that acute care hospitals get for a patient who enters.
Coding with Covid, we do we were able to code and were directed to code.
Covid patients as a co morbidity, which led to an extra.
Payment and we had a 41% drop in the quarter.
<unk> coating.
Covid co morbidity and so that that decreased reimbursement as well, but then it was the broadening and the patient mix that I just talked about that resulted in somewhat lower acuity.
We again did have growth in stroke, and neurological which are our two highest acuity categories, but growth was faster in areas like.
Lower extremity joint replacement and cardiac <unk>.
Point to two specific areas.
Got it that's helpful. And then just as a follow up you already opening for de Novo's. This year I think your April which presumably impact <unk>, how much startup cost did you incur in the quarter and how do you expect that to track throughout the year based on your latest de Novo opening.
Yeah.
Yes, we have a little over $4 million in the quarter continued to expect the range to be $10 million to $12 million for the full year and basically you can look at the opening dates that we have in there for new facilities and it is going to track.
Most of those costs are going to be borne in the months, leading up to the opening of any one of those facilities.
Great. Thanks for that Paul.
We will take our next question from Ann Hynes of Mizuho Securities. Your line is open.
Hi, good morning.
Okay. So when I look at current EBITDA guidance, where do you think you're most conservative and what would have to happen maybe to get you to the low end.
And then secondly on the tableau.
And so Austin is there any other services like the tableau that your interest over time. Thanks.
Yes, so I think when we when.
When you look at the revised guidance.
Obviously on the top line, you've always got some potential volatility around volume and we did see more of a pricing impact from the change in the patient mix in the first quarter than we were anticipating perhaps we.
We underestimated the year over year change related to the Covid comorbidity. So there's some variability there but the single biggest factor then remains what is the trend line on labor expense, we're going to continue to make the tradeoff that we have been making with regard to volume over labor expense.
I definitely think that the current guidance range that the bias is more towards the away from the lower end and more towards the mid to higher end.
And as Mark relative to your question about tableau I would say that we are always looking for ways to become more efficient providers and improve our services I would say that the <unk>.
Dialysis was an area that.
Became obvious, particularly starting back in 2020 in 2021, and we had difficulty.
With our existing.
Outstanding providers.
To provide the care when nursing shortage has really started coming into effect. So it highlighted our need to go out and do what we need to do to provide the services in house.
And reduce our reliance on outside agencies to provide it. So I think the tableau has been a real.
Good solution for us there.
And we will continue to look at other opportunities that may exist, particularly from the clinical provision number of care.
Great. Thanks.
Yeah.
We will take our next question from a J Rice of credit Suisse. Your line is open.
Hello, a J.
Hey.
First time I'd, just ask about the Jv's.
Obviously, you've got a big backlog there 18 in development.
Are you seeing the timeframe from when you start discussions to win something finalizes as that compressing as you get more of these done at the terms on the deals.
Changing in any way.
Economics because of the type of.
Our group. This JV is that changing just give us an update on what you're seeing out there.
Yes, a J just in the way of a clarification. You said, we had 18 de novo's that had been announced and are underdevelopment with opening dates beyond 2023, only a subsection of those will be JV I think right now the <unk>.
The percentage of the portfolio.
<unk> of JV opportunities somewhere between 35 and 40% take.
Take on Jv's and the economics around those really haven't changed very much with.
With regard to the gestation period on it if youre doing a joint venture with a partner who is accustomed to doing joint ventures with other providers and perhaps some as experienced with US those are going to go much faster. If it's the first time in both of those categories for a partner is probably going to be a little bit longer.
Beginning about three years ago, we made kind of a subtle shift in our strategy and as we develop more experience on successfully opening de novo's, we got more comfortable going into a market, where we thought it might be preferable to have a JV partner just announcing that we were coming on a wholly owned basis and then having subsequent to converse.
Patients with potential partners about JV ing as opposed to wiring it on the front end.
So we really haven't experienced anything in those negotiations that's impacting the timing of facilities.
The biggest challenge we have right now is just the elevation in construction cost.
Again, we've mentioned previously and we'll talk more in the days ahead about our utilization of pre fabrication that helps to contain the cost.
Construction cost over the last few years are certainly elevated.
Okay, maybe on a follow up to ask about.
You're at MA contracting we hear a lot of the MA plans talking about post acute care coordination, putting more focus on that.
That create any opportunities or challenges for you and more broadly what are you seeing with your MAA re contracting any change and other value based aspects to it.
Yeah.
Really haven't seen a lot in the way of value based initiatives arising from that payer category.
Generally speaking, we continue to make great progress on Medicare advantage.
If you look at the payer mix for the first quarter was 16% of the aggregate that compares to say, 9% as recently as 2018 since steady growth.
The payment differential.
In spite of the broadening of acuity within our MA book of business continued to be very favorable at under 5% I mentioned previously that the growth for the quarter was 20% and over 70% on a same store basis, the real opportunity that exists there is even with the tremendous progress that we've made on Medicare advantage.
<unk> the admission to referral rates for MA patients remains at half of what it is for traditional Medicare.
So for traditional Medicare we run at about 64% admission to referral and its 32% for Medicare advantage and so that just points to the fact that there are eligible patients who would benefit from treatment and earth.
Medicare advantage coverage, we're not receiving that coverage for various reasons and thats an opportunity for us and an opportunity for the MA plans. It's also something that CMS really highlighted and provided some specific guidance around and the recent update.
Interesting okay. Thanks, a lot.
We will take our next question from Steven Valiquette of Barclays. Your line is open.
Great. Thanks, Good morning, everybody good morning.
So my question really kind of relates also to the full year outlook just given the strength in the operations in the first quarter that was pretty consistent.
And all signs pointing to momentum in the second quarter I also thought maybe perhaps the full year guidance could have been raised a little bit more what's your comment here during the Q&A that theres now a bias for the full year results to come in at the high end I guess the question that really is just to confirm whether that comment was related to essentially all of the key guidance metrics that you provided previously or whether it's specific.
Vic guidance metrics that you were alluding to with that comment about the bias to the high end just wanted to try to get confirmation on that thanks.
Yes, first a clarification I don't think I said high and I think I said sure less and less in the low adding more in the mid to high.
Okay.
Steve as you know we issue annual guidance for our key financial metrics.
From time to time, what we see is that quarterly consensus estimates diverged from the internal expectations that we had in establishing that guidance.
Now we had a very good quarter.
Feel really good about how our business is performing and as a result, we raised guidance. After just one quarter of the year being done and so I think you should interpret that as it is.
Yeah.
Okay, Alright appreciate the context on that thanks.
And we will move next to Tito Chickering Deutsche Bank. Your line is open.
Hey, good morning, guys.
Hey, good morning, Thanks for taking my questions great job on the quarter.
That's sort of the volume question, just a different way.
Occupancy stood at three 4% I think is the highest I have in my models.
So my question is sort of threefold number one.
Occupancy rates, we consider to be Max occupancy due to different genders sharing rooms or requirements for one person in the room number to sort of how fast are the beds coming online versus occupancy increasing.
And number three taking a multi year view do you foresee any capacity constraints are the key to bring on beds fast enough to keep this level.
There was a lot in that.
Yeah, so the the.
Theoretical peak occupancy or Max occupancy rate that we have is rising over time that the change in the composition of our rooms.
Skewing more towards private versus semi private which allows us to work around the rooms.
Requiring isolation or gender compatibility and we still got a long way to go on that particularly with our legacy hospitals were a little over 40% in all private rooms right now.
We're continuing to address that issue in two or three important ways. One is almost all of our capacity additions without exception, the new hospitals and the bed expansions are all private rooms.
And then the second is we're undertaking some of our hospital renovation efforts to take semi private rooms, and convert those private you can't can't do at a 100% and a lot of those facilities, but it is increasing when.
When you look at it all private room.
Hospital.
<unk>.
You can see Max is going to be in the 90% range and it's really just more based on patient flows and discharge timing than anything else and a semi private room, depending on the configuration and the patient mix, it's going to be more in that probably 70% to 80% range, but we would expect it to increase over time.
I know I didn't get to all your questions, Peter which ones did that I missed.
Great answers so far I guess and then the question is as you look at your.
Bed additions for how fastest coming online versus demand, which is which is fairly significant here and so we're taking a multi year view do you foresee any capacity constraints or do you guys can you bring on that's fast enough to meet for this almost hyper growth of demand.
Yes.
We're going to be in good shape in terms of how we plan for the bed additions in which hospitals and accommodate the increasing demand for our services. So I don't anticipate it.
Widespread capacity challenge in terms of diminishing our opportunity for growth, we've been very careful and very disciplined in thinking about which facilities need the bed additions not only to accommodate the growth that's out there, but also to make sure that we minimize that.
Hospitals that have a significant hire of semi private complement so that we can increase the number of private room complements and then my final comment on that as we still have some hospitals that are heavily weighted on semi private rooms, but it has the capability to provide those patients that are.
Looking for a private room, they can still provide a single room for them than maybe semi private but not have the second bad occupied so we've been able to accommodate the demand and foresee that going forward.
In almost all situations.
The occupancy level is justifying the bed expansion, we can move pretty quickly even in Seo and states Theres typically a provision that allows for an expansion of some level, providing you've maintained a certain occupancy level for a period of time, obviously were unfettered in most instances and non CRM states lessors of physical spray.
On the facility and again the utilization of prefabricated construction, even if it's just head walls or exterior panels can allow us to shorten the construction cycle on those.
Great. Thanks, so much guys.
And once again, if you'd like to ask a question that is star one on your telephone keypad will move next to Brian tackle that of Jefferies.
Hello, Brian morning, Brian Hey, Good morning, guys congrats on the quarter.
Doug I guess as I think about staffing. Obviously, you said you are expecting the same level of temp staff, but how are you thinking about bill rates for temp labor going forward or at least for the rest of the year.
Yes.
We talk about the average.
Rate per contract Labor FTE and the fact of the matter is there is there.
<unk> to be significant disparity across geographic markets.
So there could be a little bit of a push me pull me, which is we may see that as the labor market improves across our entire network, we're able to bring down the level of contract labor ftes, but there could be certain markets, where it's still required in those markets. The rate is likely to be somewhat sticky.
So I would expect.
Some significant some additional improvement with regard to Ftes were improvement in labor conditions in existing markets is somewhat offset by capacity additions and because we see more of a concentration.
Harder market, so more stubborn markets, we may see the rate drift a little north.
But I will tell you that as complete speculation at this point, it's everyday is a new observation point, but I will say, Brian It's Mark mentioned neuro the discipline in which our operators and their various marketplaces are applying to this I mean part of that is testing the sensitivity of the market relative to price as well and so.
We have been.
Barry.
Aggressive at it.
At trying to push down the rates as we go forward whether that is from a contract standpoint, or whether that is offering less one shift bonuses than than maybe what we have done historically and certainly on the sign on bonuses.
Pretty much put a moratorium on sign on bonuses in certain marketplaces, where we just don't think they are necessary.
Got it alright, thank you guys.
And we'll go next to Ben Hendrix of RBC capital markets.
Well Ben Good morning, Ben Hey, Good morning, guys. Thank you.
Talk at length last quarter about the EBITDA flow through from changes to Epo B and now you are reaffirming the three four for the balance of the year and apologies if I missed it but how should we think about the phasing through the rest of the year given the sequential decline from <unk> I assume that there is a discharge growth for things versus the pay.
Of hires is a component, but what else do we need to keep in mind for the <unk> guidance there. Thanks.
The two most significant factors are.
The progression of patient volumes through the next three quarters and then also they're impacted by the opening and ramp up of new hospitals.
Yes.
Yeah.
So obviously youre going to have some seasonality in.
In the second and third quarters as we normally do with regard to patient volumes.
Volumes and then again just.
A factor in the timing as indicated and schedule in our supplemental slides regarding the addition to novo's it'll open this year.
Thank you.
This does conclude our question and answer session.
Happy to return the call to Mark Miller for any closing comments.
Thank you if anyone has additional questions. Please call me at 2059705860. Thank you again for joining today's call.
This does conclude today's conference you may now disconnect your lines and everyone have a great day.
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