Q4 2023 Viemed Healthcare Inc Earnings Call
[music].
Greetings and welcome to the <unk> fourth quarter 2023 earnings call.
Operator: Greetings and welcome to the Viemed fourth quarter 2023 earnings call. At this time, all participants are in a list, questions, and answers session. We'll follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad.
At this time all participants are in a listen only mode.
A brief question and answer session will follow the formal presentation.
If anyone should require operator assistance during the conference. Please press star zero on your telephone keypad.
Operator: As a reminder, this conference is being held. It is now my pleasure to introduce your host, Todd Zehnder, Chief Operating Officer. Thank you. All right, good morning, everyone.
As a reminder, this conference is being recorded.
It is now my pleasure to introduce your host Todd Zehnder, Chief operating officer. Thank you you may begin.
Hi, Good morning, everyone. Please note that our remarks in this conference call May include forward looking statements under the U S. Federal securities laws or forward looking information under applicable Canadian Securities legislation, which we collectively referred to as forward looking statements such statements reflect the company's current views and intentions with.
Todd Zehnder: Please note that our remarks in this conference call may include forward-looking statements under the U.S. federal securities laws or forward-looking information under applicable Canadian securities legislation, which we collectively refer to as forward-looking statements. Such statements reflect the company's current views and intentions with respect to future results or events and are subject to certain risks and uncertainties, which could cause actual results or events to vary from those indicated in such forward-looking statements. Examples of such risks and uncertainties are discussed in our disclosure documents filed with the SEC or with the securities regulatory authorities in certain provinces of Canada. Because of these risks and uncertainties, investors should not place undue reliance on forward-looking statements.
With respect to future results or events and are subject to certain risks and uncertainties, which could cause actual results or events to vary from those indicated in forward looking statements. Examples of such risks and uncertainties are discussed in our disclosure documents filed with the SEC or the securities regulatory authorities in certain.
Robinson of Canada.
Because of these risks and uncertainties investors should not place undue reliance on forward looking statements.
Todd Zehnder: The forward-looking statements made in this conference call are made as of today, and the company undertakes no obligation to update or revise any forward-looking statements except as required by law. The fourth quarter and year-end financial results news release, including the related financial statements, is available on the SEC's website. Now, I'll turn it over to Casey to get things started.
Forward looking statements made in this conference call are made as of today and the company undertakes no obligation to update or revise any forward looking statements, except as required by law, the fourth quarter and year end financial results news release, including the related financial statements are available on the Sec's website now I will turn it over to Casey to get things.
Started.
Casey Hoyt: Okay, thank you, Todd, and good morning, everyone. Welcome to our fourth quarter 2023 earnings call. I'm thrilled to share the exciting developments and achievements that highlight our quarter and overall year. First and foremost, I want to thank our Viemed family, made up of over 1,000 healthcare professionals treating patients in all 50 states. Our people signify the collective strength, passion, and expertise required to improve life.
Okay. Thank you Todd and good morning, everyone.
Welcome to our fourth quarter 2023 earnings call.
I'm thrilled to share the exciting developments and achievements that highlight our quarter and overall year first and foremost I want to thank our VI Mad family made up of over 1000 health care professionals treating patients in all 50 states.
Our people signify the collective strained passion and expertise required to improve life.
Casey Hoyt: Each member of our team plays a pivotal role in our ability to enhance the lives of our patients and produce positive outcomes for physicians and payers alike. Our growing workforce, fueled by our best-in-class HR department and staffing division, enables us to extend our reach to a broader community. Our commitment to our employees is reflected in the investment we make in their development, well-being, and job satisfaction.
Each member of our team plays a pivotal role in our ability to enhance the lives of our patients and produce positive outcomes for physicians and payers alike.
Growing workforce fueled by our best in class HR Department and staffing Division.
That is to extend our reach to a broader community.
The commitment to our employees as well as reflected in the investment we make in their development wellbeing and job satisfaction.
Casey Hoyt: This fosters a positive work culture that separates us from our competition and is most certainly the cornerstone of our success. Moving on to the quarter, perhaps some of the most significant work we accomplished in the fourth quarter was our efforts surrounding the restructuring of our sales force. Recognizing the need for more localized training and management infrastructure, we reorganized the country to create a more regional and localized approach to help with training and work-life balance for our people.
This fosters a positive work culture that separates us from our competition and there's most certainly the cornerstones of our success.
Moving onto the quarter, perhaps some of the most significant work we accomplished in the fourth quarter was our efforts surrounding the restructuring of our sales force rep.
Recognizing the need for more localized training and management infrastructure, we reorganized the country to create a more regional and localized approach to help with training and work by balance five people.
Our new structure, which launched in early 'twenty 'twenty four paved the way for multiple territory sales manager and national sales directorship promotions.
Casey Hoyt: Our new structure, which launched in early 2024, paved the way for multiple territory sales manager promotion and national sales directorship promotion. This expansion and fortification of our team are driven by the vision of accommodating the growth trajectory of our organization. By leveraging the strengths of our top performing sales personnel, we are not only strengthening the leadership of our sales force but also fostering a culture of excellence and continuous development. These leaders and trainers play a crucial role in shaping the capabilities of our team, ensuring that every team member is equipped with the knowledge, skills, and motivation necessary to excel in their roles.
This expansion and fortification of our team is driven by the vision of accommodating the growth trajectory of our organization.
By leveraging the strengths of our top performing sales personnel, we're not only strengthening the leadership of our sales force, but also fostering a culture of excellence and continuous development.
These leaders and trainers play a crucial role in shaping the capabilities of our team ensuring that every team member is equipped with the knowledge skills and motivation necessary to excel in their roles.
Casey Hoyt: After the restructuring, we finished the year with 106 sales territories, with the current bandwidth to expand as needed to another 30. Our people are effectively empowered and even better equipped with the clinical experience and coaching to reach more patients than ever before. At the heart of Viemed Healthcare's operational efficiency is our proprietary clinical management technology, the EngageCare Manager. This innovative technology has revolutionized the delivery of respiratory care, empowering our respiratory therapists to maximize their patient reach and significantly contribute to heightened patient satisfaction. Our technology captures sophisticated data, demonstrating improved clinical outcomes and substantial cost savings, becoming a linchpin in securing contracts and pilot programs. The ongoing VA pilot is a noteworthy initiative showcasing the positive impact of our technology on shaping the future of respiratory care for veterans across the country.
After the restructuring we finished the year with 106 sales territories with the current bandwidth to expand as needed to another 30.
Our people are effectively empowered and even better equipped with the clinical experience and coaching to reach more patients than ever before.
At the heart of iPad health Care's operational efficiency as I proprietary clinical management technology engage care managers.
This innovative technology has revolutionized the delivery of respiratory care empowering our respiratory therapists to maximize their patient reach and significantly contribute to heightened patient satisfaction.
Our technology captures sophisticated data demonstrating improved clinical outcomes and substantial cost savings, becoming a lynchpin in securing contracts and pilot programs.
V. A pilot is a noteworthy initiative showcasing the positive impact of our technology on shaping the future of respiratory care for veterans across the country.
Behind the scenes, we continue to uncover more technological solutions that are helping to streamline our workflow processes.
Casey Hoyt: Behind the scenes, we continue to uncover more technological solutions that are helping streamline our workflow process. Engage Care Manager has been adding more machine learning-type features that have the potential to really drive faster access to care for our patients and help Viemed improve reauthorization tasks. Furthermore, we are seeing a rapid adoption of e-prescribing from our referral sources that helps with our authorization and conversion rates. These technological tools are not only creating operational excellence for us but are also improving efficiencies for our referral sources. All of our departments at Viemed are hyper-focused and empowered to utilize technological advancements that can contribute to our strong human touch offering in the home. Further contributing to this technological success are the advancements with the majority of our suppliers who have embraced connectivity to their devices, which in turn delivers data to our engaged care manager platform, particularly those who have emerged as new entrants into the market post the Phillips recall.
Engage care manager has been adding more machine learning types of features that have the potential to really drive faster access to care for our patients and help I met improve reauthorization task.
Furthermore, we are seeing a rapid adoption to the use of E. Prescribing from our referral sources that help with our authorization and conversion rates.
These technological tools for not only creating operational excellence for us, but are also improving efficiencies for our referral sources.
All of our departments have I've met a hyperfocus and empowered to utilize technological advancements that can contribute to our strong human touch offering in the home.
Further contributing to this technological success success are the advancements with the majority of our suppliers, who have embraced connectivity to their devices, which in turn delivers data tar engage care manager platform.
Particularly those who have emerged as new entrants into the market post the Philips recall Easter.
Casey Hoyt: These direct and collaborative supplier partnerships are helping to control costs and improve quality. A key to our competitive edge lies in our software being seamlessly integrated across multiple companies. Ultimately, this integration strengthens our relationships with these manufacturers and enhances operational efficiencies while streamlining processes. On the regulatory front, our reimbursement environment remains strong. Despite the expiration of the 75-25 blended rates, when combined with the CPI adjustments, we anticipate experiencing no net deterioration in average reimbursement rates.
These direct and collaborative supplier partnerships are helping to control cost and improve quality.
Key to our competitive edge lies in our software being seamlessly integrated across multiple companies.
Ultimately this integration strengthens our relationships with these manufacturers.
His operational efficiencies, while streamlining processes.
On the regulatory front, our reimbursement environment remains strong despite the exploration of the 70 525 blended rates when combined with the CPI adjustments, we anticipate experiencing no net deterioration of average reimbursement rates importantly showed that 70 525 rate be extended through the legislation.
Casey Hoyt: Importantly, should the 75-25 rate be extended through legislation, we are poised to experience some potential upside. The final rule for Medicare Advantage plans and other positive changes open the door for further growth of our services due to the payer expansion. With these positive regulatory shifts, we anticipate a noteworthy improvement in the behavior and compliance of Medicare Advantage payers. The increased transparency and accountability introduced by the final rules signal a transformative era, fostering an environment where payers are incentivized to align with Viemed Healthcare's commitment to delivering high-quality respiratory care. These regulatory changes act as a powerful catalyst, not only for our financial stability but also for our ability to extend our services to a broader spectrum of patients. As we gain clarity on the limited impact of GLP-1 drugs on the home medical equipment industry, specifically regarding CPAP usage, the available evidence suggests that initial concerns were significantly overstated.
We are poised to experience some potential upside.
The final rule for Medicare advantage plans and other positive changes opened the door for further growth of our services due to the payer expansion.
With these positive regulatory shifts we anticipate a noteworthy improvement in our behavior and compliance of Medicare advantage pairs.
The increased transparency and accountability introduced by the final rule signal attract transformative Arabs fostering an environment, where payers are incentivized to align with VI med health care's commitment to delivering high quality respiratory care.
These regulatory changes act as a powerful catalyst not only for our financial stability, but also for our ability to extend our services to a broader spectrum of patients.
As we gain clarity on the limited impact of G. L. P. One drugs on the home medical equipment industry, specifically regarding CPAP usage. The available evidence suggests that initial concerns were significantly overstated the.
Casey Hoyt: The industry has shown resilience, with no current negative impact on the Viemed sleep business. Our sleep business is growing faster than previous years, with New Patient Rentals starting, with new patient rental starts indicating promising future resupply revenue growth. A real-world study conducted by ResMed revealed a modest increase in adherence when CPAP users also take GOP-1 drugs.
The industry has shown resilience with no current negative impact on the bottom edge sleep business, our sleep business is growing faster than previous years.
With new patient rentals starting.
With new patient rental starts, indicating promising future resupply revenue growth.
A real World study conducted by resume revealed a modest increase in adherence with CPAP users also take G. O P. One drugs aligning with the industry observations.
Casey Hoyt: Aligning with the industry observation, The industry remains proactive, addressing potential long-term pressure from GLP-1s by focusing on increasing awareness, reducing operational costs through automation, and enhancing patient adherence and retention efforts. In 2023, our commitment to enhancing the lives of patients and reaching a broader demographic became evident through a series of strategic initiatives. We meticulously expanded our geographical reach, broadened our product offerings, and diversified our payer mix, aligning our trajectory with the evolving needs of the healthcare landscape. An undeniable highlight of our strategic endeavors was the targeted acquisition of HMP, which was immediately accretive to net income and EPS, highlighting the effectiveness of our M&A strategy and integration capabilities. Subsequent to the acquisition date, we have also achieved significant cost savings resulting in improved profitability of the acquired operation, primarily because of the sleep diversification that we accumulated through the acquisition.
The industry remains proactive addressing potential long term pressure from G. O P ones by focusing on increasing awareness, reducing operational costs through automation and enhancing patient adherence and retention efforts.
In 2023, our commitment to enhance the lives of patients and reaching a broader demographic became evident to a series of strategic initiatives, we meticulously expanded our geographical reach broadened our product offerings and diversify our payer mix aligning our trajectory with the evolving needs of the health care landscape.
And undeniable highlight of our strategic endeavors was the targeted acquisition of H M. P, which was immediately accretive accretive to net income and EPS highlighting the effectiveness of our M&A strategy and integration capabilities.
Subsequent to the acquisition date, we have also achieved a significant cost savings, resulting in improved profitability of the acquired operations.
Primarily because of the sleep diversification that we accumulated through the acquisition our total rental patient count is up 85% over the prior year and I resupply patient count is up 205%.
Casey Hoyt: Our total rental patient count is up 85% over the prior year, and our resupply patient count is up 205%. While we actively pursue strategic acquisitions, our core strength and foundation for growth remains our robust organic engine. We continue to emphasize that for Viemed, acquisitions are not a necessity, but rather a thoughtful and complementary strategy to accelerate our success.
While we actively pursue strategic acquisitions, our core strength and foundation for growth remains a robust organic engine. We continue to emphasize that provide mad acquisitions are not a necessity, but rather a thoughtful and complementary strategy to accelerate our success.
Todd Zehnder: With that being said, we continue to be actively engaged in multiple processes, analyzing strategic initiatives and partnerships that capitalize on our competitive advantage as a high-touch, high-tech clinical provider of home medical services. Our team fully expects to incrementally grow inorganically through strategic JV partnerships and acquisitions in 2024. With more financial and operational updates on the quarter, I'll now hand the call over to Chief Operating Officer Todd Zehnder.
With that being said, we continue to be actively engaged in multiple processes analyzing strategic initiatives and partnerships that capitalize on our competitive advantage is our high touch high Tech critical provider of home medical services. Our team does fully expect to incrementally grow inorganically through strategic JV partnerships and acquisitions.
In 2024.
With more financial and operational updates on the quarter I'll now hand, the call over to Chief operating Officer, Todd Zehnder, Todd Alright, Thanks, Casey and reviewing the financial results. All figures are in U S dollars and they were full results had been made available on the Sec's website as well as SEDAR.
Todd Zehnder: All right. Thanks, Casey. In reviewing the financial results, all figures are in U.S. dollars, and the full results have been made available on the SEC website as well as on CDAR. Our core business generated net revenue of $50.7 million during the fourth quarter of 2023 as compared to net revenues of $37.5 million in the fourth quarter of 2022, which equates to a 35% increase. Our sequential growth for the core business was 3%, which is a good sign that the integration of the HMP acquisition, along with our organic growth, continued in line with our historical norm. Our revenue for the year ended December 31, 2023, came in at $183 million, which is a 32% increase over 2022. We continue to stay optimistic that we will be able to continue our high organic growth rates as well as continue our evaluation of inorganic opportunities. Our fourth-quarter revenue from VINCE was approximately 58% of our revenue, as compared to 66% in the fourth quarter of 2022.
Our core business generated net revenue of $50 7 million during the fourth quarter of 2023 as compared to net revenues of $37 5 million in the fourth quarter of 2022, which equates to a 35% increase our sequential growth for the core business was 3%, which is good. It's a good sign that the integration of the H M. P. A.
Acquisition, along with our organic growth continued in line with our historical norms.
Our revenue for the year ended December 23rd December 31st 2023 came in at 183 million, which is a 32% increase over 2022.
We continue to stay optimistic that we will be able to continue our high organic growth rates as well as continue our evaluation of the organic opportunities are.
Our fourth quarter revenue from Vince was approximately 58% of our revenue as compared to 66% in the fourth quarter 2022.
Todd Zehnder: Our gross and EBITDA margins are still strong and improving as we are focused on both margin and diversification. We have been very successful in managing our cost structure this year, and it is showing in both gross and EBITDA contributions. As usual, we want to point out the rapid nominal growth of our margin but are also proud of the increase in the percentages over the last six months. Our gross and EBITDA margins during the quarter came in at 63.3% and 25.3%, respectively.
Our gross and EBITDA margins are still strong and improving as we are focused on both margin and diversification.
We've been very successful in managing our cost structure. This year and it is showing in both gross and EBITDA contribution.
As is typical we want point out the rapid notional growth of our margins, but are also proud of the increase in the percentages over the last six months.
Our gross and EBITDA margins during the quarter came in at $63, three and 25, 3% respectively.
Todd Zehnder: Our quarter growth in EBITDA amounts came in at $32.1 and $12.8 million, respectively. Both growth and EBITDA margin and margin percentages grew sequentially and continue our theme of profitable growth, both organically and inorganically. Our full-year EBITDA for 2023 was $43.1 million, which is a new company record, and we are really starting to see the advantages of building scale. While we don't always comment on net income, I think it's important to point out that this is our seventh consecutive year of positive net income, marking profitable growth every year since our public formation. Additionally, we are at a point in our company life cycle and revenue composition where free cash flow is really ramping up. During the quarter, we generated $5.4 million of free cash flow, and we generated over $19 million for the year.
Our fourth quarter gross and EBITDA amounts came in at 32.1, and $12 8 million respectively.
Both gross and EBITDA margin and margin percentages grew sequentially and continues our theme of profitable growth both organically and inorganically.
Our full year EBITDA for 2023 was $43 1 million, which is a new company record and we are really starting to see the advantages of building scale.
Well, we don't always comment on net income I think is important to point out that this is our seventh consecutive year of positive net income marking profitable growth every year since our public formation.
Additionally, we are at a point in our company lifecycle and revenue composition that free cash flow is really ramping up.
During the quarter, we generated $5 4 million of free cash flow and we generated over 19 million for the year.
Todd Zehnder: I will address capital allocation priorities later in the call. Our SG&A for the quarter totaled approximately $23.9 million as compared to $17.2 million in the fourth quarter of 2022. For the full year, our SG&A totaled $87.9 million, as compared to $68.2 million in 2022, the latter of which did not include any H&P contribution.
I will address capital allocation priorities later in the call.
Our SG&A for the quarter totaled approximately $23 9 million as compared to $17 2 million in the fourth quarter of 2022.
For the full year, our G&A totaled $87 9 million as compared to $68 2 million. During 2022, the latter of which did not include any H M. P contribution.
G&A as a percentage of revenue decreased from 49% during 2022% to 48% during 2023, which is another good sign that we are managing our G N a well along with effectively integrating the first acquisition.
Todd Zehnder: GNA as a percentage of revenue decreased from 49% during 2022 to 48% during 2023, which is another good sign that we are managing our GNA well, along with effectively integrating the first acquisition. We will continue to invest in our patient and employee experiences and once again expect to grow revenues at a faster rate than expenses. For the quarter, we invested approximately $7.9 million in capital expenditures.
We will continue to invest in our patient and employee experiences and once again expect to grow revenues at a faster rate than expenses.
For the quarter, we invested approximately $7 9 million on capital expenditures and once again, the highest amounts had been spent on Vince and oxygen equipment.
Todd Zehnder: And once again, the highest amounts have been spent on vents and oxygen equipment. We continue to allocate capital across a diverse supplier network and once again have had no problems with procuring the equipment necessary to service our growing patient base. As previously mentioned, we funded all of our CapEx with discretionary cash flow during the quarter, and our core business is generating significant free cash flow after CapEx. We are very proud of the pristine balance sheet we maintain, where we ended the quarter with a cash balance of $13 million.
We continue to allocate capital across a diverse supplier network and once again have had no problems with procuring the equipment necessary to service our growing patient base.
As previously mentioned, we funded all of our Capex with discretionary cash flow during the quarter and our core business is generating significant free cash flow after capex.
We are very proud of the pristine balance sheet, we maintain where we ended the quarter with a cash balance of $13 million.
Todd Zehnder: Additionally, we ended the quarter with an overall working capital of $6 million. We've paid down all but $2 million on our revolver facility and have lowered our long-term debt at December 31st to approximately $6 million. We will opportunistically pay down or use the revolver portion of our credit facility depending on the needs of cash resulting from additional organic growth or future inorganic opportunities. The end of the year is a great time to step back and analyze the performance of a business. We are very proud of the organic growth that we have exhibited and are extremely pleased that we augmented that with a very complementary and significant acquisition. Additionally, we have remained profitable, further diversified our business, and continue to generate very solid liquidity.
Additionally, we ended the quarter with an overall working capital at $6 million.
We've paid down all but 2 million on our revolver facility and have lowered our long term debt at December 31st two approximately $6 million.
We will opportunistically pay down or use the revolver portion of our credit facility, depending on the needs of cash, resulting from additional organic growth or future inorganic opportunities.
The end of the year. It gives a great time to step back and analyze the performance of our business. We are very proud of the organic growth that we exhibited and are extremely pleased that we augmented that with a very complementary and significant acquisition.
Additionally, we have remained profitable further diversified our business and continue to generate very solid liquidity.
Todd Zehnder: We continue to grow the amount of revenue that is transactional and are confident in our ability to generate free cash flow, giving us flexibility as we continue to monitor our capital allocation. On that front, our capital allocation opportunities are similar to last quarter, and we will reiterate that our organic growth is the highest priority. Like last quarter, we used free cash flow to pay down on our revolver and will continue to do so unless we transact on another inorganic opportunity.
We continue to grow the amount of revenue that is transactional and are confident in our ability to generate free cash flow, giving us flexibility as we continue to monitor our capital allocation.
On that front, our capital allocation opportunities are similar to last quarter, and we will reiterate that our organic growth is the highest priority.
Like last quarter, we used free cash flow to pay down on our revolver and we'll continue to do so unless we transact on another inorganic opportunity.
Todd Zehnder: Lastly, we will actively monitor our share price and other factors to determine if another share buyback would make sense to be implemented. Moving on to the first quarter, we have provided net revenue guidance in the 49.7 to 51 million dollar range related to our core business. The midpoint of our net revenue guidance is up 27% over the core revenue in the first quarter of 2023. The first quarter brings the seasonality of patients changing insurance carriers, more significant reauthorizations, and deductible recess. But we are very pleased with how the first quarter new patient setups are trending across all of our products. We remain active in our discussions with existing and potentially new investors, and our recent voluntary delisting from the TSX has consolidated our daily trading volumes onto the NASDAQ. We have seen our U.S. institutional ownership increase over the last couple of months. We continue to participate in institutional investor conferences and plan on attending two more in March and April.
Lastly, we will actively monitor our share price and other factors to determine if another share buyback would make sense to be implemented.
Moving onto the first quarter, we have provided net revenue guidance in the $49.7 million to $51 million range related to our core business.
The mid point of our net revenue guidance is up 27% over the core revenue in the first quarter of 2023.
The first quarter brings the seasonality of patients changing insurance carriers more significant reauthorization and deductible resets, but we are very pleased with how the first quarter new patient setups are trending across all of our product lines.
We remain active in our discussions with existing and potentially new investors and our recent voluntary delisting from the T. S X has consolidated our daily trading volumes onto the NASDAQ.
We have seen our U S institutional ownership increase over the last couple of months.
We continue to participate in institutional investor conferences and planning on attending two more during March and April we.
Casey Hoyt: We remain excited about telling our story of growth and see the current market as an opportunity to attract new investors. At this time, I'm going to turn it back over to Casey to wrap things up. Okay, thank you, Todd.
We remain excited about telling our story of growth and see the current market as an opportunity to attract new investors.
At this time I'm going to turn it back over to Casey to wrap things up.
Okay. Thank you Todd.
Casey Hoyt: After looking back on Viemed's journey, I was reflecting on some of the financial milestones our company has achieved. Since our initial public listing, we have grown adjusted EBITDA to nearly equal the total revenue for this spin-out year in 2017. Along the way, we have achieved this incredible growth while doing so as a profitable company every single year. VIMED's financial success and consistent track record are a testament to the resilience, strategic acumen, and unwavering commitment of our entire team. The aging population continues to be a significant factor in our industry. Meanwhile, technological advancements and increased awareness are shaping the adoption of our specialized home medical services.
After looking back on by emerge journey I was reflecting on some of the financial milestones our company has achieved.
Since our initial public listing we have grown adjusted EBITDA nearly equal the total revenue for the spin and spin out year in 2017, along the way we have achieved this incredible growth while doing so it was a profitable company and every single year.
Biomass financial success and consistent track record is a testament to the resilience and strategic acumen and unwavering commitment of our entire team.
The aging population continues to be a significant factor in our industry dynamics.
Simultaneously technological advancements and increased awareness of shaping the adoption of our specialized home medical services, we believe the home medical equipment markets hold promising opportunities for continuous expansion and we stand ready to leverage our expertise in navigating this landscape.
Casey Hoyt: We believe the home medical equipment markets hold promising opportunities for continuous expansion, and we stand ready to leverage our expertise in navigating this landscape. The fourth quarter of 2023 stands as a testament to ViMed Healthcare's unwavering dedication to excellence and growth. Our growth is propelled by strong relationships with suppliers, seamlessly integrated proprietary technology, and a commitment to innovation. The Engaged Care Manager, our Innovative Clinical Management Technology, exemplifies our dedication to operational excellence, providing transformative benefits for our respiratory therapists and enhancing patient care. The expansion into new geographies, diversification of product and payer mix, and targeted acquisition initiatives underscore our commitment to reaching more patients. In closing, Viemed Healthcare enters the future with confidence, guided by a resilient team, a strong financial foundation, and a commitment to delivering exceptional respiratory care.
The fourth quarter of 2023 stands as a testament to buy Med health Care's unwavering dedication to excellence in growth our growth has propelled by strong relationships with suppliers seamlessly integrated proprietary technology and a commitment to innovation and.
We engage care manager, our innovative clinical management technology.
Exemplifies our dedication to operational excellence, providing transformative benefits for our respiratory therapists.
Enhancing patient care.
The expansion into new geographies diversification of product and payer mix and targeted acquisition initiatives underscore our commitment to reaching more patients.
In closing I met health Care's, Biomed healthcare enters the future with confidence guided by a resilient team a strong financial foundation, and our commitment to delivering exceptional respiratory care.
Casey Hoyt: The positive regulatory environment supports our growth initiatives, allowing us to strategically strengthen our sales force and make investments that position BiMed for sustained success. As we build towards the future, the strategic addition of leaders and trainers, coupled with our commitment to exploring innovative partnerships, reflects our patience, reflects our dedication to not just keep pace with the industry but to set new standards. As we look ahead, the path is clear for Viemed. We will continue to expand our footprint and refine our offer. The combination of these activities, coupled with our ability to track our success, translates into an unparalleled ability to drive value for payers.
The positive regulatory environment supports our growth initiatives, allowing us to strategically strengthen our sales force and make investments that position by mad for sustained success.
As we build towards the future. The strategic addition of leaders and trainers coupled with our commitment to exploring innovative partnerships reflects our patients reflects our dedication to not just keep pace with the industry.
But to set new standards of excellence.
As we look ahead. The path is clear provide that we will continue to expand our footprint and refine our offerings. The combination of these activities coupled with our ability to track our success translates into an unparallel ability to drive value for payers.
Operator: We thank all of our shareholders who have placed their trust in Viemed and look forward to telling our story to more shareholders as our company continues to expand across the country. This concludes our prepared remarks. Thank you, and we'll now open up for further questions. Thank you. We'll now conduct our question and answer session. If you would like to ask a question, please press star 1 on your telephone. A confirmation tone will indicate that your line is in the question area. You may press star 2 if you would like to remove your question from. For participants using the speaker, it may be necessary to pick up your handset before pressing the start key.
We thank all of our shareholders, who have placed their trust in <unk> and look forward to telling our story to more shareholders as our company continues to expand across the country.
This concludes our prepared remarks, thank you and we'll now open up further questions.
Thank you, we'll now conduct a question and answer session. If you would like to ask a question. Please press star one on your telephone keypad.
Confirmation tone will indicate that your line is in the question queue.
You May press Star two if you would like to remove your question from the queue.
For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys, one moment, please while we poll for questions.
Operator: One moment, please, while we pull. And our first question comes from Brooks O'Neill with Lake Street Capital Markets. Thank you very much.
Yeah.
And our first question comes from Brooks O'neil with Lake Street Capital markets. Please state your question.
Well. Thank you very much good morning, guys.
Brooks O'Neill: Good morning, guys. I thought perhaps I had jumped on the wrong conference call when I heard Casey talking about all that high-tech stuff, but it's pretty impressive. Yeah, we're excited about the technological advancements, but what's your question, Brooke? All right, so my first question. I'm just. I hate to betray my ignorance here, but give us just a little background on the 75-25 blended Medicare rate, how much impact you think that might have in 2023, and what you're seeing in terms of the outlook for 2024. Sounds like it might go away. Yeah, Brooks and Todd. I'll take that one.
I thought.
Got it.
I thought perhaps I had jumped on the wrong conference call when I heard Casey talking about all that stuff, but.
But it's pretty impressive.
Thanks.
Yeah Alright.
But we're excited.
Alex advancements, but whats your question Brooks.
Hi, So my first question I'm just.
I hate to be trained by my ignorance here, but give us just a little background on the 70 525 blended Medicare rate.
Much impact you think that might have bad in 2023, and what youre seeing in terms of the outlook for 2024, it sounds like May might go what.
Yeah Brooks this is Todd I'll take that one during the P. H E. There were several concessions obviously made by CMS during during that time and one of them was to give some rate relief to.
Todd Zehnder: During the PHE, there were several concessions obviously made by CMS during that time, and one of them was to give some rate relief to a former competitive bid product. So when we're talking about it, it specifically relates to, in our opinion, the sleep and oxygen business. And long story short, they had given rate relief by making it a little bit less weighted towards the competitive bid area rates and more to the rural rates.
Former competitive bid product so when we're talking about it specifically relates to in our and our stance as it relates to the sleep and oxygen business and long story short they had given rate relief by making it a little bit less are weighted towards the competitive bid area rates and more to the rural rates.
So with the exploration of that and it really comes down to the only way it's going to get bought back is through a congressional bill I guess on the budget that would give us the relief. It has now gone back to former rates I don't have a 2023 number but what we can tell you is it's roughly about a three.
Todd Zehnder: So with the expiration of that, and it really comes down to the only way it's going to get brought back is through a congressional bill, I guess, on the budget that would give us the relief. It has now gone back to former rates. I don't have a 2023 number, but what we can tell you is it's roughly about a $3 million impact on an annual basis for our company for 2024. You can think about it as $750,000 plus or minus for the first quarter that we are not factoring in.
Dollar impact on an annual basis to our our company for 2024, you can think about it is 750000 plus or minus for the first quarter that are that we are not factoring in I mean, we have lowered our guidance assuming that is not going to happen. So it's it's not super material, but some.
Todd Zehnder: I mean, we have lowered our guidance, assuming that it is not going to happen. So it's not super material, but something that we would much rather have higher rates for these people in the smaller cities around the country. Sure, that's extremely helpful. I really appreciate that color.
And that we would much rather have these higher rates because you know it's the value added service for these people and and those smaller cities around the country.
Sure.
STREAMWAY helpful. I really appreciate that color. Let me just ask you did it sounds like things just broadly are going well I know that in.
Casey Hoyt: Let me just ask you this. It sounds like things are just broadly going well. I know that over the last several years, maybe RT availability has been a bit of a headwind. How are you feeling about that situation today?
Over the last several years, maybe our T availability has been a bit of a headwind.
How are you feeling about that situation today.
Casey Hoyt: We're not seeing any holdbacks on finding our RTs right now. The staffing division is pretty much clicking on all cylinders with finding our folks. Yeah, I'm talking a lot in the script about the restructuring of the sales force, and, you know, what's interesting is that, you know, we're throwing more support with more clinical support behind our head sales folks, that are really, you know, developing into veteran productive areas. And so just the landscape of the type of personnel, the type of RT that we're looking for has evolved a little bit.
Where we're not seeing any hold backs on finding our our team right now the staffing division is pretty much clicking on all cylinders on finding our folks I think what.
I'm talking a lot about in the script about the restructuring of the sales force and you know what's what's interesting is that you know would throw in more support labore clinical support behind our head sales folks that are really you know developing into veteran productive areas and so just the.
But of that type of personnel with the type of RT that we're looking far has evolved a little bit it's more of your support role.
Casey Hoyt: It's more of your support role, but we still look for our sales roles as well, but we don't have any issues trying to find our respiratory therapist at this time to answer your question. All right, that's great. Let me just ask you a little technical question about my model.
But are we still look for our sales roles as well, but not having any issues trying to are finding our respiratory therapists at this time to answer your question.
Alright, that's great let me just hit.
A little technical question about my model I noticed that the tax rate this quarter was a little bit higher than I had been modeling.
Todd Zehnder: I noticed that the tax rate this quarter was a little bit higher than I had been modeling. Is that a rate somewhere in the very low 30% range that you think is likely to play out in 2024? I think it will probably go back down some, Brooks. I think this had to do with some permanent differences, and I'll probably reserve the right for you to talk to Trey later on, but I think it has something to do with some permanent differences that we had to take the expense for during the fourth quarter really related to future periods. Okay, well, that's very helpful. I think that does it for me. I'm excited to hear about all the progress and the opportunities and, you know, the incredible results you delivered last year. So I know 24 is going to be another great year.
Is that a rate somewhere in the very low 30% range that you think is likely to play out in 'twenty 'twenty four.
I think that it will probably go back down some Brooks I think this had to do with some permanent differences and I'll I'll probably reserve the right for you to talk to trade later on but I think it has something to do with some permanent differences that we had to take the expense for during the fourth quarter really related to future periods.
Okay, well that's very helpful.
That does it for me I'm excited to hear you.
About all the progress and the opportunity and you know the incorrect results you delivered last year. So I know 24 is going to be another great year.
Brooks O'Neill: Thanks, Brooke. And our next question comes from Doug Cooper with Beacon Security. Hey, good morning, guys.
Thanks Brooks Brooks.
And our next question comes from Doug Cooper with Beacon Securities. Please state your question.
Hey, good morning, guys congrats on another nice quarter.
Doug Cooper: Congratulations on another nice quarter; talk about organic growth. By my calculations, I guess, excluding the impact of HMP, organic growth year over year in quarter four was about 16%. Is that in the ballpark?
I just wanted to talk about organic growth by my calculations I guess, excluding the impact of H M. P organic growth year over year and quarter four was about 16%.
The bumper.
Todd Zehnder: Yeah, that sounds about right. Okay, so, and then the Q1 guidance, again, excluding if I compare Q1, your guidance midpoint to Q1 last year, which obviously didn't have HMP in there, it looked about 10%. And then sequentially, about flat.
Yeah that sounds about right.
Okay.
So and then the Q1 guidance again, excluding <unk>.
Compare Q1 your guidance midpoint to Q1 last year, which obviously didn't have HMT and there it looks like 10%.
And then sequentially about flat, so maybe just talk a little bit about.
Todd Zehnder: So maybe just talk a little bit about it. What do you see when the growth happens? Yeah, as it relates to 1Q over 4Q, the main thing, or 1Q over last year's 1Q, we do have more of our business coming from what I would consider sleep products, which are probably a little bit more susceptible to deductibles and seasonality. And truthfully, as more of our patients hit insurance changes, it's becoming more common that people are swapping around on insurances, and it puts patients on hold. We don't lose the patient, but we just maybe miss a bill or two. That is seeming to have a little bit higher impact on us. As it relates to the 16%, I mean, I think that's a really good growth year for us. It's not as high as our historical rates, but we've always been clear to say that as we get bigger, the ability to grow 25 and 30% is getting harder just because the notional amounts are getting larger.
What are you seeing on the grocery.
Yeah, I'll as it relates to <unk> over <unk>. The main thing or once you over last years. Once you. We we do have more of our business coming from what I would consider the sleep products, which has you know is it probably a little bit more susceptible to deductibles and seasonality and truthful.
He has more of our patients hit insurance changes, it's becoming more common that people are swapping around on insurances and it puts patients on hold we don't lose the patient, but we just maybe miss a bill or two that is seeming to have a little bit higher impact on us as it relates to the 16% I mean I think that's.
It's a really good growth year for us is not as high as our historical rates, but we've always been clear that say that as we get bigger the the ability to grow 25, and 30 per cent is getting harder just because the notional amounts are getting larger I think the one important thing to think about as it relates to sequential is our new patient starts or is high.
Todd Zehnder: I think the one important thing to think about as it relates to sequential is that our new patient starts are as high or higher than we've ever seen in the first couple of months. So the fix is there. We just got to get more patients to see their doctors, and get paperwork submitted, and we're on track with what is setting up to be a really good 2024.
Or higher than we've ever seen in the first couple of months. So the fix is there we just got to get more patients just to see their doctors to get paperwork submitted and we're on track with what is setting up to be a really good 2024.
Perfect and then just so you talked about I would say that's going to be set up well for the resupply business can you give me some actual metrics that would be a reason to buy a business in quarter four.
Todd Zehnder: And then just as you talked about, let's say that's going to set up well for the resupply business. Can you give us some actual metrics on the resupply business in quarter four? For 20 in Q4 or for 24? I'm Doug.
For 'twenty and Q4 or for 24 I'm done.
No for Q4.
Todd Zehnder: No, for Q4, and maybe some expectations. Um, I want to say that Q4 resupply made up about 10% of our revenue base as a company. I don't have that number right in front of me, but I think that that's probably pretty close to where we are.
Q4 expectations.
I want to say that Q4 resupply made up about.
10% of our revenue base as a company that's a I don't have that number right in front of me, but I think that that's probably pretty close to where we are and if you think about it in that now that's including both by met an H M. P.
Todd Zehnder: And if you think about it, now that that's including both Viemed and H&P, think about where that was probably a year ago; that would have been at best 3%. So the resupply, like we've talked about, our own organic Viemed sleep growth, the end game is to get more and more patients on that resupply program, obviously, and continue to set up new patients to add to the funnel. But that's what we brought in with H&P, our own business. So when I referenced several times in the script about transactional revenue and being able to generate free cash flow, the fact that we have that number upwards of, call it, gaining on double digits is a major milestone for us. Good. And you've seen sort of roughly $600 annualized per patient on the resupply. Is that a decent number to use? I'm sorry, Doug. What was that? The revenue per resupply patient, is it sort of an annualized run rate of about $600, is that the number? Micah.
If you think about where that was probably a year ago that would've been at best 3%. So the resupply I mean like like we've talked about our own organic VI Mad sleep grows the end game is to get more and more patients on that resupply program. Obviously continue to set up new patients for the <unk> to add.
The funnel, but that's what we brought in with the H M. P. Our own business. So when I when I referenced several times in the script about transactional revenue and being able to generate free cash flow. The fact that we have that number upwards of call. It.
Gaining on double digits is a major milestone for us.
Alright.
And have you seen sort of roughly $600 annualized per patient on the resupply is that a decent number to use.
I'm, sorry, what was that.
The revenue per for resupply patients is it is it sort of annualized run rate of about 600 Bucks is that the member.
That makes sense.
Todd Zehnder: Yeah, I would say we're about 200 to 215 per order, and it just depends. I mean, if you want to say that three times, that might be a little high for us. I want to say we're somewhere in the two and a half orders per patient per year, but it may be gaining on that. So somewhere between 550 and $650 per patient per year. Okay, and what percentage of your sleep patients will be on the resupply program today? As far as our active sleep patients, like the active PAP rental patients, or all of them, effectively, I mean, everybody that meets compliance is going to be on the resupply program. So, you know, if we end up setting up about 1,500 on a consolidated basis a month, our resupply program's probably going to be in the 30,000 patients. So it's obviously a lot bigger because the PAP caps out.
Yeah, I would say were about 200 to 215 per order and it just depends I mean, if you want to say that three times that that might be a little high for us I want to say, we're somewhere in the two and a half orders per patient per year, but it it may be gaining on that.
So somewhere between 550 and $650 per patient per year.
And what percentage of your sleep patients to be on the resupply program today.
Yeah.
As far as our active sleep patients like the active Pap rental patient, yes, Oh, yeah, Oh, yeah, I'm a factor I mean, everybody that noncompliance b on the resupply programs. So you know if we end up for setting up a thousand about 1500 on a consolidated basis a month, our resupply programs more probably.
And the 30000 patients. So it's obviously a lot bigger because the Pat caps out.
Todd Zehnder: Yeah, yeah. Okay, and I guess this is my final one, the actual Venn patients, 10,327 down the year, up marginally from 10,244. Can you talk about your outlook for actual Venn patient growth this year? Yeah, look. I mean, we're going to continue to say that our expectation is to grow that patient count by 100 a month. We didn't get there in the fourth quarter.
Yep Yep.
Okay, and I guess it was just my final one the actual burn patients at 10327 day end of the year are marginally from the 10000 or $2 44.
Can you just talk about your outlook for actual.
<unk> been patient growth this year.
Yeah look I mean, we're going to continue to say that our expectation is to grow that patient count call. It 100, a month, we didn't get there in the fourth quarter.
Todd Zehnder: We'll see if we get there in the first quarter. Obviously, as we get larger, the attrition is higher. You start out with, I mean, our average length of stay is staying at 17 months.
We'll see if we get there in the first quarter.
Obviously as we get larger the attrition is higher you start out with I mean, our average length of stay is staying at 17 months. So we're losing more patients just due to exploration Unfortunately, but some of the stuff. The case, he talked about where a lot of new sales initiatives and we're obviously out there trying to get new new regions and new contracts, we still.
Todd Zehnder: So we're losing more patients just due to expiration, unfortunately. But some of the stuff that Casey talked about were a lot of new sales initiatives, and we're obviously out there trying to get new regions and new contracts. We still show up every day expecting to grow that on a net basis by about 100 a month. Some quarters we do it, some we don't.
Show up every day expecting to grow that on a net basis about 100, a month some quarters, we do it some we don't.
We're still we're still very confident that that growth is going to continue.
Todd Zehnder: We're still very confident that vent growth is going to continue. And once again, I'm very pleased with where we're seeing new patient setups in the first quarter. Okay, great. That's it for me.
And once again I'm very pleased with where we're seeing new patient setups in the first quarter.
Okay.
Okay, Great. That's it for me Thank you guys.
Doug Cooper: Thank you, guys. Thanks, Doug. And thank you, audience. A reminder to the audience: press star 1 to ask a question. You can press star 2 to remove yourself from the question.
Thanks, Doug.
Thank you a reminder to the audience press star one to ask a question you can press star two to remove yourself from the question queue.
Our next question comes from Nick Corcoran with acumen. Please state your question.
Operator: Our next question comes from Nick Corcoran with Acumen. Hello, this is Megan on the line for Nick this morning. Nick had a question regarding the event, patient growth, and respiratory illnesses this winter. Have respiratory illnesses this winter tempered your patient expectations at all, or has it been pretty usual for the season? Well, I mean, we don't have this specific number on respiratory illnesses. It's not something that we watch on a daily basis.
Hello. This is Megan on the line for Nick This morning, Nick had a question regarding the.
Ah patient growth in respiratory illnesses. This winter have respiratory illnesses as winter temperature patient expectations at all or has it been pretty east walks through the season.
Well I mean, we I don't have the specific number on respiratory illnesses as not something that we watch on a daily basis, but you're seeing are our vent growth in terms of total that patients that we were just talking about.
Casey Hoyt: But you're seeing our vent growth in terms of total vent patients that we were just talking about on the rise. So we're optimistic that there will be plenty of patients out there for 2024. It's just a matter of getting our people trained and up and running and producing in an efficient manner, which is what the restructuring is focused on. Okay, thank you. And our next question comes from Eric Caldwell with Baird. Thank you and good morning.
On the rise so we're optimistic that theres plenty of patients out there for 'twenty 'twenty four is just a matter of getting our people trained and up and running and producing and in an efficient manner, which is what the restructuring is focused on.
Okay. Thank you.
Okay.
Thank you.
And our next question comes from Eric Coldwell with Baird. Please state your question.
Thank you and good morning.
Eric Caldwell: I wanted to ask two questions. The first is on Phillips and their decision to stop selling equipment in the U.S.; just what kind of knock-on effects have you seen? Is there any lingering impact from their recalls and their regulatory issues and now their decision to extricate themselves from the U.S. market? Yeah, I'll take it.
Wanted to ask two questions. The first is on Philips and their decision to stop selling equipment in the U S. Just what kind of knock on effects have you seen and is there any lingering impact of there recalls in their regulatory issues and now their decision to.
Uh huh.
Extricate themselves from the U S marketplace. Thank you.
Yeah, I'll take it as it relates I'll I'll split it up into two products, because it really affects paths and Vince more than other rather than on the pop side, you know it really doesn't impact us outside of the fact that in the event that we have patients that are on our Philips product they might want a different product I don't think we're not seeing that.
Todd Zehnder: I'll split it up into two products because it really affects PAPs and vents more than other items. On the PAP side, it really doesn't impact us outside of the fact that in the event that we have patients that are on a Philips product, they might want a different product. We're not seeing that on any large scale or really any scale for that matter.
And any large scale or really any scale for that matter.
Todd Zehnder: So it shouldn't impact the sleep business anymore. It did in the past when we had to get all of those patients set up on new equipment, be it either a new Philips device that was FDA compliant or some of our other vendors. This has been going on for a few years now, and the good news is we have adequate sleep providers or other manufacturers who are able to fulfill all of our needs at this point. So there are no issues there. As it relates to the vent, the recall is still in place, and I know that Philips and the FDA are working on a remediation.
So it shouldn't impact the sleep business anymore. It did in the past when we had to get all of those patients are set up on new equipment be it either a new Philips device that was F D a compliant or some of our other vendors.
This has been going on for a few years now and so the good news is we have adequate sleep providers.
Providers are other manufacturers, who are able to fulfill all of our needs at this point so no issues there as it relates to the events.
The recall is still in place and I know that Philips and the F. D. A are working on a remediation it's very minor in our opinion, a very minor remediation, but one that has taken a long time to get done the ability for us to continue to service patients where those ventilators remains and we are we are still servicing patients and had been re.
Todd Zehnder: It's a very minor, in our opinion, a very minor remediation, but one that has taken a long time to get done. The ability for us to continue to service patients with those ventilators remains, and we are still servicing patients and have been reworking devices. So the ability for us to continue with that is not at risk, in our opinion. At some point, they won't be in the market for making parts down the road and so forth, but we are planning effectively for that. I think the best thing, though, Eric, is that it's been going on for three years, and we've diversified our fleet at this point, and there are three other very competent vent manufacturers out there, and we're probably up to roughly 50 percent of our fleet being non-Philips at this point, and only getting larger every month.
<unk> devices. So the ability for us to continue with that is is not at risk in our opinion at some point they won't be in the market of making parts down the road and so forth, but we are planning effectively for that I think the best thing, though Eric is that it's been going on for three years and we diversified our fleet at this.
And there are other there are three other very confident a vent manufacturers out there and we're probably up to roughly 50% of our fleet being non Philips at this point and are only getting larger every month.
Eric Caldwell: Perfect. The second topic, you alluded to this in the prepared remarks. I've been focused on it. CMS's final rules are actually, I think, a set of three of them in total, one that went live in January, one that goes, another one that goes live in 2026. In general, we're seeing CMS really rein in these Medicare Advantage and Managed Medicaid plans for things like improper denials, unnecessary and improper prior authorizations, and also CMS forcing these plans to fully cover everything that's covered under fee-for-service, which was not always I'm curious, you mentioned he could be a good guy. I'm just curious, have you... Do you have any statistics or analysis that might suggest how...
Perfect.
Secondly, second topic.
You alluded to this in the prepared remarks I've been focused on at the.
CMS final rules are actually I think a set of three of them in total one that went live in January one that goes another one that goes live in 2026, but.
In general we're seeing CMS really rein in these Medicare advantage and managed Medicaid plans for.
Things like improper denials are unnecessary and improper prior authorizations.
Also CMS, forcing these plans to fully cover everything that's covered under fee for service, which was not always the case in the past.
Providing faster appeals resolution transparency a lot of good things for the <unk> industry I believe I'm curious you mentioned it could be a good guy I'm just curious if you.
Do you have any statistics or analysis that might suggest how these tight tighter rules around the DMC OS could actually.
Todd Zehnder: These tighter rules around the MCOs could actually..., quantitatively impact you? Is that something that is available? And have you seen any impact at this point given? The last roll went into effect a couple of months ago. Yeah, I mean, we've seen a little bit of a behavioral shift, so everything I have is really anecdotal in terms of stories and approvals. I don't have a number right here in front of me, but I can circle back with you, Eric, on what we're seeing. I predict that the behavior is going to change here with all of these final rules now in place. It's not material at this moment in time, but check back in Q2 and we might have some metrics there that hopefully we see some metrics that are signs of life for improvement on authorizations, and they're following Medicare guidelines, which is all they really need to do. So we're optimistic. Oh, go ahead, please. Sorry. No, no, that's it.
Quanta quantify quantitatively impact to us is that something that is available and have you seen any impact at this point given the last rule went into effect a couple of months ago.
Yeah, I mean, we've seen a little bit of a behavior shifts to everything I have is really anecdotal in terms of stories in and approvals I don't have a number of right here in front of me, but I can circle back with you Eric on on on what we're seeing I predict that whereas the behavior is going to change here with all of these fine.
Oh rules now in place.
And you know it's not material at this moment in time, but you know check back in Q2, when we might have some metrics there that hopefully we see some metrics that part.
Our signs of life for improvement on authorizations in and they're following Medicare guidelines, which is all they really need to do so.
Oh go ahead, please sorry.
No no. That's it we're just optimistic about what's going to happen.
Casey Hoyt: We're just optimistic about what's going to happen. Yeah, it can't hurt, I think, is the way we look at it. Last one, just maybe a bit of a reach and a derivative of something that's happening nationally with this, changing healthcare, and cyber attacks. Have you seen any?
Yeah, I get it it can't hurt.
We can look at it.
Last one are you know.
Just.
Maybe a bit of a a bit of a reach and are a derivative off something that's happening nationally with this change health care cyber attack have you seen any have you seen any impact in the last.
Eric Caldwell: seen any impact in the last two-plus weeks regarding this in terms of any form of patient challenge or customer behavior shift in the marketplace? It's getting a lot of headlines. I think most of our companies are saying it's probably not going to be a material knock-on effect, but I am curious whether there is any ripple effect from the challenges that United is having with changing health care and, therefore, a number of providers are having challenges as well. Yeah, I'll take that. I mean, the beginning part of your question is the part that we can definitively say we're thankful nothing has happened. Patient care has not been compromised at all.
Two plus weeks regarding this in terms of any any form of patient challenge or customer behavior shift in the marketplace.
It's getting a lot of headlines I think most of our companies are saying, it's probably not going to be a material knock on effect, but I am curious if you've seen any ripple effect from the challenges that are United as having with change healthcare and then therefore, a number of providers are having challenges as well.
Yeah, I'll take that I mean, the beginning part of your question is the part that we can definitively say, we're thankful nothing has happened patient care has not been compromised at all and so that's the most important thing I know two weekends ago.
Todd Zehnder: And so that's the most important thing. I know two weekends ago, the pharmaceutical benefits had some issues, and I think that was the first thing they tackled. So they stood that up, and things are good. So we can definitively say we've been able to take care of patients and continue to get authorizations in a timely manner. What will happen is the submission of claims is getting slowed down.
The pharmaceutical benefits were where some issues and I think that was the first thing. They tackled so they've got that stood up and things are good. So we can definitively say, we've been able to take care of patients and continue to get authorizations in a timely manner. What will happen is the submission of claims is getting a slowed down we are anything that's.
Todd Zehnder: Anything that's going through change has been halted for about the last 10 days. We have proactively worked to get through two phases to go ahead and reroute some of our largest carriers to other clearinghouses so that we can keep the cash flow coming in. It's really a delay more than anything, but it's a disruption to the industry for sure. We applaud and support their efforts to make sure that it's secure going forward, because we take security very seriously around here. So they need to do the right thing, and I know they will.
Going through change has been halted for about the last 10 days.
We have proactively worked to get.
Through two phases to go ahead and reroute.
Some of our largest carriers to other clearing houses so that we can keep the really the cash flow coming in this is really a delay more than anything but if there's just a lot of that yeah.
Yeah, it's a disruption to the industry for sure we we applaud and support their efforts to make sure that it's secure going forward because we take security very seriously around here. So they need to do the right thing and I know they are in the interim we are taking the taking the time to go ahead, and just reroute payers to make sure we're not.
Todd Zehnder: In the interim, we are taking the time to go ahead and just reroute payers to make sure we're not negatively impacted from a cash standpoint. Are you willing to share who you're rerouting to, and what other payer switches you're using? I mean, currently, I don't mind saying it. Currently, the largest reroute is going to Waystar slash Zermed. I think it's the same one, but that's probably our second largest.
Negatively impacted from a cash standpoint.
Are you willing to share who your rerouting to what what other payers switches you're using.
I mean currently our law I don't mind, saying that currently the largest reroute is going to waste our slashes our mad I think it's one and the same but that's.
That's probably our second largest and then all of our all of our federal monies are directly with CMS. So that's not impacted.
Todd Zehnder: And then all of our federal monies are directly with CMS, so that's not impacted. So you're not, not in test, not anticipating a notable impact on cash flow this quarter, which I think is the knock-on effect that most of our supply chain coverage is focused on, but it doesn't sound like it's a material concern and whatever it is is likely transitory. Yeah, assuming that all of our efforts that are ongoing come through, that cash flows are, as expected, we shouldn't see a material impact. It may slow down some cash for a little while, but nothing that's going to hamper our ability to continue to do anything around here. Perfect. Let me add my congratulations to a nice continued performance. Good talking to you guys. Thanks very much. Thanks, Eric.
So you're not not in test not anticipating a notable impact on cash flow this quarter, which I think is the knock on effect that most of our supply chain covered just focused on but it doesn't sound like it's a.
A material concern them whatever it is as likely transitory.
Yeah, assuming that all of our efforts that are ongoing come through the cash flows are.
We are expected, we shouldn't see a material impact it it may slow down some cash for a little while but nothing that's going to hamper our ability to continue to do anything around here.
Perfect. Let me, let me add my congrats to a nice continued performance good talking to you guys. Thanks very much. Thanks.
Eric Caldwell: Have a good day, man. Thank you. And there are no further questions at this time. I'll hand the floor back to. Yeah, we want to thank everybody for their interest in Viemed today. And if there are any follow-ups, just reach out to us. Have a great day. Thank you. This concludes today's conference.
Thanks, Eric I have a good day man.
Thank you and there are no further questions at this time I'll hand, the floor back to management for closing remarks. Thank you.
Yeah, we want to thank everybody for your interest in <unk> today, and if there are any follow ups just reach out to us have a great day.
Thank you. This concludes today's conference all parties may disconnect.