Q2 2024 MultiPlan Corp Earnings Call

If you would like to enter the queue for questions, you may do so by dialing star followed by one on your telephone keypad. I would now like to hand the conference over to Shawna Gasik, AVP of Investor Relations. Thank you. Please go ahead.

Unknown Executive: and Keith Badd.

Shawna Gasik: I would now like to hand the conference over to Shawna Gasik, ABP of Investor Relations. Thank you. Please go ahead.

Shawna Gasik: Thank you, Harry.

Unknown Executive: Thank you, Harry. Good morning and welcome to MultiPln's second quarter 2024 earnings call. Our speakers today are Travis Dalton, Chief Executive Officer, and Jim Head, Chief Financial Officer. Jerry Hogg, Chief Operating Officer, will be available for the Q&A session.

Shawna Gasik: Good morning, and welcome to MultiPln's second quarter of 2024 earnings call. Our speakers today are Travis Dalton, Chief Executive Officer, and Jim Head, Chief Financial Officer. Jerry Hogg, Chief Operating Officer, will be available for the Q&A session. The call is being webcast and can be accessed through the Investor Relations section. This is our website at MultiPln.com. During our call, we will refer to the supplement of Slide Back that is available on the Investor Relations portion of our website, along with the second quarter 2024 earnings press release issued earlier this morning.

Shawna Gasik: Thank you, Harry. Good morning, and welcome to MultiPlan's second quarter 2024 earnings call. Our speakers today are Travis Dalton, Chief Executive Officer, and Jim Head, Chief Financial Officer. Jerry Hogg, Chief Operating Officer, will be available for the Q&A session.

Unknown Executive: The call is being webcast and can be accessed through the investor relations section of our website at MultiPlan.com. During our call, we will refer to the supplemental slide deck that is available on the investor relations portion of our website, along with the second quarter 2024 earnings press release issued earlier this morning. Before we begin, a couple of reminders. Our remarks and responses to questions today may include forward-looking statements. These forward-looking statements represent management's beliefs and expectations only as of the date of this call.

Speaker Change: The call is being webcast and can be accessed through the Investor Relations section of our website at MultiPlan.com.

Shawna Gasik: Before we begin, a couple of reminders. Our remarks and responses to questions today may include forward-looking statements; these forward-looking statements represent management's beliefs and expectations only as of the date of this call. Actual results may differ materially from these forward-looking statements due to a number of risks. A summary of these risks can be found on the second page of the Supplement of Slide Back, and a more complete description on our annual report on Form 10-K and other documents we file with the SEC. We will also be referring to several non-GAAP measures, which we believe provide investors with a more complete understanding of MultiPln's underlying operating results.

Speaker Change: Before we begin, a couple reminders. Our remarks and responses to questions today may include forward-looking statements. These forward-looking statements represent management's beliefs and expectations only as of the date of this call. Actual results may differ materially from these forward-looking statements due to a number of risks.

Unknown Executive: Actual results may differ materially from these forward-looking statements due to a number of risks. A summary of these risks can be found on the second page of the supplemental slide deck and a more complete description in our annual report on Form 10-K and other documents we file with the SEC. We will also be referring to several non-GAAP measures, which we believe provide investors with a more complete understanding of MultiPln's underlining operating results.

Speaker Change: A summary of these risks can be found on the second page of the supplemental slide deck and a more complete description on our annual report on Form 10-K and other documents we file with the SEC.

We will also be referring to several non-GAAP measures, which we believe provide investors with a more complete understanding of MultiPlan's underlining operating results.

Shawna Gasik: An explanation of these non-GAAP measures and reconciliation to their comparable GAAP measure can be found in the earnings press release and in the supplement of Slide Back.

Unknown Executive: An explanation of these non-GAAP measures and reconciliations to their comparable GAAP measure can be found in the earnings press release and in the supplemental slide deck. With that, I would now like to turn the call over to our Chief Executive Officer, Travis Dalton. Travis?

Shawna Gasik: With that, I would now like to turn the call over to our Chief Executive Officer, Travis Dalton.

Travis Dalton: Travis. Thank you, Shawna, and good morning to all of you on the call. Thank you for your time today.

Travis Dalton: Thank you, Shawna, and good morning to all of you on the call. Thank you for your time today. I recently completed my first 100 days in my first full quarter here at MultiPln. I know more now than I did coming in, have validated my views on several aspects of the company, continue to learn, and I'm convinced we will execute our evolution and transformation over time. I would like to share my reflections on the business with you today.

Travis Dalton: I recently completed my first 100 days and my first full quarter here at MultiPln. I know more now than I did coming in. I validated my view on several aspects of the company, continue to learn, and then convinced we will execute on our evolution and transformation over time.

Speaker Change: I recently completed my first 100 days and my first full quarter here at MultiPlan.

I know more now than I did coming in.

Travis Dalton: I would like to share my reflections on the business with you today. It goes without saying it's been an interesting time to join the company, and I'm more committed than ever to our transformational journey.

Travis Dalton: It goes without saying that it's been an interesting time to join the company, and I'm more committed than ever to our transformational journey. But that journey must begin with an honest assessment and a brutal confrontation of the facts.

Speaker Change: I would like to share my reflections on the business with you today.

Speaker Change: It goes without saying, it's been an interesting time to join the company, and I'm more committed than ever to our transformational journey. That journey must begin with an honest assessment and a brutal confrontation of the facts. I am exceedingly proud of our commitment to client and relentless pursuit of service excellence.

Travis Dalton: That journey must begin with an office assessment and a brutal confrontation of the facts. I'm exceedingly proud of our commitment to clients and relentless pursuit of service excellence. That is a very good thing. However, the fact is that financial results matter, and our simply haven't been consistent, predictable, or good enough. We must perform better. By now, many of you have had the opportunity to review our second quarter financial results and our updated full year guidance. Those results fell short of the expectation set entering the year. I revised outlook is more fully aligned with the current realities of our business in the short term, but underlying that I am encouraged by some key indications of progress and even more so by significant opportunities for growth in the mid and long term.

Travis Dalton: I am exceedingly proud of our commitment to clients and relentless pursuit of service excellence. That is a very good thing. However, the fact is that financial results matter, and ours simply haven't been consistent, predictable, or good enough. We must perform better. By now, many of you have had the opportunity to review our second quarter financial results and our updated full year guidance. Those results fell short of the expectations set entering the year.

Speaker Change: Those results fell short of the expectations set entering the year.

Travis Dalton: Our revised outlook is more fully aligned with the current realities of our business in the short term, but underlying that, I am encouraged by some key indications of progress and, even more so, by significant opportunities for growth in the mid and long term. All of that said, I'm as excited as I've been since joining this great company. We have a clear, compelling vision and strategy for the future. We have great clients and long-standing relationships, and an Operating Plan to execute better as we move forward, a current product portfolio that delivers value, and a clearly defined set of new product opportunities.

Travis Dalton: All of that said, I am as excited as I have been since joining this great company. We have a clear, compelling vision and strategy forming for the future. We have great clients and longstanding relationships and operating plan to execute better as we move forward a current product portfolio that delivers value. a clearly defined set of new product opportunities on technology and data assets and a team of incredibly talented and dedicated professionals. We have a strong business foundation; we generate cash flow, and we have ample time to make progress.

Speaker Change: Operating Plan to Execute Better as we Move Forward, a Current Product Portfolio that Delivers Value,

Travis Dalton: Uncapped Technology and Data Assets, and a team of incredibly talented and dedicated professionals. We have a strong business foundation, we generate cash flow, and we have ample time to make progress. Our transformation requires a deep commitment to change, a sense of urgency, and decisive action. Showing meaningful progress may take a bit longer than we had hoped, but I'm confident we can and will execute. Simply put, we know what to do to make this a world-class data and technology company that operates with more rigorous processes, increased discipline, and enhanced organic product capability that drives more value for more clients across more markets. Over time, this will lead to sustainable growth.

Speaker Change: A clearly defined set of new product opportunities.

Speaker Change: Uncapped Technology and Data Assets.

Speaker Change: and a team of incredibly talented and dedicated professionals.

Speaker Change: We have a strong business foundation, we generate cash flow, and we have ample time to make progress.

Travis Dalton: Our transformation requires a deep commitment to change, a sense of urgency, and decisive actions. Showing meaningful progress may take a bit longer than we have hoped, but I am confident we can and will execute. Simply put, we know what to do to make this a world-class data and technology company that operates with more rigorous process, increased discipline, and enhanced organic product capability that drives more value for more clients across more markets. Over time, this will lead to sustainable growth.

Speaker Change: May take a bit longer than we had hoped, but I am confident we can and will execute.

Speaker Change: Simply put, we know what to do to make this a world class data and technology company that operates with more rigorous process, increased discipline, and enhanced organic product capability that drives more value for more clients across more markets.

Travis Dalton: In a moment, I will share some of the encouraging progress that we're making, and I very much look forward to an opportunity to share with you my comprehensive vision for our transformation and an integrated strategic operational and financial plan in detail in the coming quarters.

Travis Dalton: In a moment, I will share some of the encouraging progress that we're making, and I very much look forward to an opportunity to share with you my comprehensive vision for our transformation and an integrated strategic, operational, and financial plan in detail over the coming quarters. As I mentioned on our last earnings call, we have established a core operating framework to ensure that we more consistently achieve our results. Before I speak to the progress we've made against that framework, I would like to address a few key issues right up front. First, the overhang of media scrutiny has been an ongoing challenge.

Speaker Change: Over time, this will lead to sustainable growth.

Travis Dalton: As I mentioned on our last earnings call, we have established a core operating framework to ensure that we more consistently achieve hours.

Speaker Change: As I mentioned on our last earnings call, we have established a core operating framework to ensure that we more consistently achieve our results over time.

Travis Dalton: Over time, before I speak to the progress we've made against that framework, I would like to address a few key issues right up front. First, the overhang of media scrutiny has been an ongoing challenge. We have addressed it head on, engaged directly with stakeholders, updated our value proposition, and will continue to do so proactively. We have established a corporate and government affairs team, inclusive of a world-class public relations and lobbying representation, and will continue to protect our reputation, defend our business against misinformation of false narratives, and educate healthcare stakeholders about the value that we provide.

Speaker Change: Before I speak to the progress we've made against that framework, I would like to address a few key issues right up front.

Travis Dalton: We have addressed it head-on, engaged directly with stakeholders, updated our value proposition, and will continue to do so proactively. We have established a corporate and government affairs team, including world-class public relations and lobbying representation, and will continue to protect our reputation, defend our business against misinformation and false narratives, and educate healthcare stakeholders about the value that we provide. We will actively use our voices to support the aims of health care quality, price transparency, and cost control.

Speaker Change: First, the overhang of media scrutiny has been an ongoing challenge. We have addressed it head-on, engaged directly with stakeholders, updated our value proposition, and will continue to do so proactively.

Speaker Change: We have established a corporate and government affairs team inclusive of world-class public relations and lobbying representation, and will continue to protect our reputation, defend our business against misinformation and false narratives, and educate healthcare stakeholders about the value that we provide.

Travis Dalton: We will actively use our voice to support the aims of health care quality, price transparency, and cost control. Next, we continue to confront, with openness and transparency, the legal claims against us, which we believe are without merit and are attempting to misuse the law in a way that will ultimately increase prices for patients and employers. The data is very clear that MultiPlan, which operates in a highly competitive environment, makes healthcare more affordable for consumers, offers services across the entire continuum, seeks to eliminate or reduce bounce bills, and supports price transparency and the No Surprises Act.

Speaker Change: We will actively use our voice to support the aims of health care quality, price transparency, and cost control.

Travis Dalton: Next, we continue to confront with openness and transparency the legal claims against us, which we believe are without merit and are an attempt to misuse the law in a way that will ultimately increase prices for patients and employers.

Speaker Change: Next, we continue to confront with openness and transparency the legal claims against us.

Speaker Change: which we believe are without merit and are an attempt to misuse the law in a way that will ultimately increase prices for patients and employers. The data is very clear that MultiPln, which operates in a highly competitive environment, makes healthcare more affordable for consumers, offers services across the entire continuum,

Travis Dalton: The data is very clear that MultiPln, which operates in a highly competitive environment, makes health care more affordable for consumers, offers services across the entire continuum, seeks to eliminate or reduce balance bills, and supports Price Transparency and the No Surprises Act. We are confident that the facts clearly support the merits of our products and the important role our company plays in the healthcare ecosystem. Next, we have faced a series of one-time environmental challenges that have impacted our clients, our claims flow, and our results. These included the clearinghouse destruction, which continued to affect us through the first half of the second quarter.

Speaker Change: seeks to eliminate or reduce balance bills and supports price transparency and the No Surprises Act. We are confident that the facts clearly support the merits of our products and the important role our company plays in the healthcare ecosystem.

Travis Dalton: We are confident that the facts clearly support the merits of our products and the important role our company plays in the healthcare ecosystem.

Travis Dalton: Next, we have faced a series of one-time environmental challenges that have impacted our clients; our claims slow in our results. These include the clearinghouse destruction, which continue to affect us through the first half of the second quarter. We will continue to navigate these challenges and support our clients as we do.

Speaker Change: Next, we have faced a series of one-time environmental challenges that have impacted our clients, our claims flow, and our results.

Speaker Change: These included the clearinghouse destruction, which continued to affect us through the first half of the second quarter. We will continue to navigate these challenges and support our clients as we do.

Travis Dalton: We will continue to navigate these challenges and support our clients as we do. Next, it's taken longer to generate commercial traction with our new product initiatives than anticipated. However, I am confident that demand is there, the pipeline is growing, and the operating plan I mentioned earlier will get us back on track. Finally, we believe the prices of our products and services are competitively positioned in the marketplace across the spectrum of our clients, large and small, with the exception of an attrition overhang related to one of our larger clients. We have been growing at a mid single-digit rate across the remainder of our customer base, and while we now expect this attrition to constrain growth until mid 2025.

Travis Dalton: Next, it's taken longer to generate commercial traction with our new product initiatives than anticipated. However, I am confident that demand is there, the pipeline is growing, and the operating plan I mentioned earlier will get us back on track. Finally, we believe the prices of our products and services are competitively positioned in the marketplace across the spectrum of our clients, large and small. With the exception of an attrition overhang related to one of our larger clients, we have been growing at a mid single-digit rate across the remainder of our customer base. While we now expect this attrition to constrain growth until mid 2025.

Speaker Change: Next, it's taken longer to generate commercial traction with our new product initiatives than anticipated.

Speaker Change: However, I am confident that demand is there, the pipeline is growing, and the operating plan I mentioned earlier will get us back on track.

Speaker Change: Finally, we believe the prices of our products and services are competitively positioned in the marketplace across the spectrum of our clients, large and small.

Speaker Change: with the exception of an attrition overhang related to one of our larger clients.

Speaker Change: We have been growing at a mid-single-digit rate across the remainder of our customer base. While we now expect this attrition to constrain growth until mid-2025, at that point, the waste should finally be clear for us to show growth in our core business.

Travis Dalton: At that point, the way should finally be clear for us to show growth in our core business. We have remarkable clients. It is our imperative to relentlessly develop and deliver new value for them. We will continue doing that because we are proud to serve them, and because doing so will sustain our success. After the value we provide in the market, before I joined MultiPln, I served providers for 21 years. In light of that, I had to ask myself the question, is MultiPln good for health care? I am as confident as ever that the answer is yes, unequivocally.

Travis Dalton: At that point, the way should finally be clear for us to show growth in our core business.

Travis Dalton: We have remarkable clients. It is our imperative to relentlessly develop and deliver new value for them. We will continue doing that because we are proud to serve them because doing so will sustain our success.

Speaker Change: We have remarkable clients. It is our imperative to relentlessly develop and deliver new value for them. We will continue doing that because we are proud to serve them and because doing so will sustain our success.

Travis Dalton: After the value we provide in the market, before I join MultiPln, I serve providers for 21 years. In light of that, I have asked myself the questions: MultiPln good for health care. I am as confident as ever that the answer is yes, unequivocally. We have a clear point of view validated by facts. We are explicitly articulating that to stakeholders across our corporate communication channels, including our investor website.

Speaker Change: After the value we provide in the market, before I joined MultiPln, I served providers for 21 years.

Travis Dalton: We have a clear point of view, validated by facts. We are explicitly articulating that to stakeholders across our corporate communication channels, including our investor website. We will continue to communicate proactively and aggressively in support of our mission to make health care more transparent, fair, and affordable for all. Going back to how we intend to move forward in support of our vision to transform into a data and technology-driven organization with an aggressive growth mindset, we are actively engaged across the company in a five-year strategic and resource planning exercise.

Speaker Change: I am as confident as ever that the answer is yes, unequivocally. We have a clear point of view, validated by facts.

Speaker Change: We are explicitly articulating that to stakeholders across our corporate communication channels, including our investor website. We will continue to communicate proactively and aggressively in support of our mission to make healthcare more transparent, fair, and affordable for all.

Travis Dalton: We will continue to communicate proactively and aggressively in support of our mission to make health care more transparent, fair, and affordable for all.

Travis Dalton: Getting back to how we intend to move forward and support of our vision to transform into a data and technology-forward organization. With an aggressive growth mindset, we are actively engaged across the company in a five-year strategic and resource planning exercise. This process, which is being led by our chief operating officer, includes assessing our market potential, evaluating our current set of products, sharpening new product development, fortifying our sales and go-to-market strategies, and clearly articulating our plan with precision, both internally and externally. This will allow us to remain laser focused on executing now, but also to pair through the next products and business development.

Speaker Change: With an aggressive growth mindset, we are actively engaged across the company in a five-year strategic and resource planning exercise. This process, which is being led by our Chief Operating Officer, includes assessing our market potential, evaluating our current set of products,

Travis Dalton: This process, which is being led by our Chief Operating Officer, includes assessing our market potential, evaluating our current set of products, Sharpening New Product Development, fortifying our sales and go to market strategies, and clearly articulating our plan with precision both internally and external. This will allow us to remain laser focused on executing now, but also prepare for the next. Products and Business Development. Our vision builds on a strong foundation that includes our analytics-based services, 1.4 million provider networks, payment integrity products, HST Value Driven Health Plans, and Data and Decision Science Capabilities in Price Transparency Risk Analytics. Supplemental Insurance, and other areas.

Speaker Change: Sharpening New Product Development.

Speaker Change: fortifying our sales and go-to-market strategies, and clearly articulating our plan with precision both internally and externally.

Speaker Change: This will allow us to remain laser focused on executing now, but also prepare for the next through product and business development.

Travis Dalton: Our vision builds on a strong foundation that includes our analytics-based services, 1.4 million provider network, payment integrity products, HST value-driven health plans, and data and decision science capabilities and price transparency, risk analytics, supplemental insurance, and other areas, building a resource and capital allocation with precision, along with developing and adhering to a robust and welcoming annual operating plan will help us realize our vision and maximize those results.

Speaker Change: Our vision builds on a strong foundation that includes our analytics-based services, 1.4 million provider network, payment integrity products,

Speaker Change: HST Value Driven Health Plans, and Data and Decision Science Capabilities in Price Transparency Risk Analytics.

Travis Dalton: Building a resource and capital allocation with precision, along with developing and adhering to a robust and well-complete annual operating plan, will help us realize our vision and maximize those results. Delivering on that vision will be all about execution. We will be focused on our operating principles, clarity of purpose, alignment of talent, and focusing on KPIs and accountability. And we will be focusing on getting fit for growth with the process rigor worthy of a great public company. Let me take each of these in turn.

Speaker Change: Supplemental Insurance, and other areas.

Speaker Change: Building a resource and capital allocation with precision, along with developing and adhering to a robust and well-complete annual operating plan, will help us realize our vision and maximize those results.

Travis Dalton: Delivering on that vision will be all about execution. We will be focused on our operating principles, clarity of purpose, alignment of talent, and focus on KPIs and accountability.

Speaker Change: Delivering on that vision will be all about execution.

Travis Dalton: We will be focusing on getting fit for growth with the process rigor worthy of a great public company. Let me take each of these in turn. Clarity, we've made significant progress updating our message check and value proposition. We've refreshed our external messaging, website, and educated many key stakeholders.

Speaker Change: And we will be focusing on getting fit for growth with a process rigor worthy of a great public company.

Travis Dalton: Clarity, we've made significant progress updating our message set and value properties. We've refreshed our external messaging website and educated many key stakeholders. We will continue to be vocal in the role we play across the healthcare ecosystem.

Speaker Change: Clarity, we've made significant progress updating our message set and value proposition.

Speaker Change: We've refreshed our external messaging, website, and educated many key stakeholders. We will continue to be vocal in the role we play across the healthcare ecosystem.

Travis Dalton: We will continue to be vocal in the role we play across the healthcare ecosystem, alignment. We have added significant talent and line clear accountability with the authority to operate. We've added a senior vice president of corporate affairs, the vice president of government affairs, a chief data scientist, a national sales leader, additional new market sales talent, and we have an incoming CFO. Combined with our existing talent, we have a team that is committed to and capable of accelerating our transformation.

Travis Dalton: We have added significant talent and clear accountability with the authority to operate. We've added a Senior Vice President of Corporate Affairs, a Vice President of Government Affairs, a Chief Data Scientist, a National Sales Leader, additional new market sales talent, and we have an incoming CFO. Combined with our existing talent, we have a team that is committed to and capable of accelerating our transformation.

Speaker Change: Alignment. We have added significant talent and applying clear accountability with the authority to operate. We've added a Senior Vice President of Corporate Affairs, a Vice President of Government Affairs, a Chief Data Scientist,

Travis Dalton: Focus. We have rounded out our set of 41 KPIs and have a clear tracking mechanism with accountable owners to ensure we execute on our strategies. This will allow us to take prudent real-time decisions and monitor forward indicators of progress against our goals.

Travis Dalton: We have rounded out our set of 41 KPIs and have a clear tracking mechanism with accountable owners to ensure we execute on our strategy. This will allow us to take prudent real-time decisions and monitor forward indicators of progress against our goals. As we advance clarity, alignment, and focus, becoming fit for growth will encompass two key areas: Process, Rigor, Discipline, and Insights. We've established data-driven bookings forecasts, an annual operating plan, a monthly operating cadence, and a product lifecycle management approach.

Speaker Change: Focus. We have rounded out our set of 41 KPIs and have a clear tracking mechanism with accountable owners to ensure we execute on our strategies.

Travis Dalton: As we advance clarity, alignment, focus, becoming fit for growth will encompass two key areas. Process, rigor, discipline, and insights. We have established data-driven bookings forecast, an annual operating plan, monthly operating cadence, and product life cycle management approach. We have much work to do, but this will yield more predictable results with business and enable us to make more and better products over time.

Speaker Change: Process, Rigor, Discipline, and Insights. We've established data-driven bookings forecasts, an annual operating plan, monthly operating cadence, and product lifecycle management approach.

Travis Dalton: We have much work to do, but this will yield more predictable results for business and enable us to make more and better products over time, laser focus on where we put our time and energy. The processes noted are all in support of the clear allocation of resources.

Speaker Change: We have much work to do, but this will yield more predictable results for the business and enable us to make more and better products over time.

Travis Dalton: Laser focus on where we put our time, energy, and money. The processes noted are all in support of clear allocation of resources. They won't able us to make sound and timely decisions around expense and capital outweighs that deliver better quarterly performance and create long-term value. They will help us prioritize investments in those products and initiatives that are most important to growth and have the highest market potential over time.

Speaker Change: Laser focus on where we put our time, energy, and money.

Speaker Change: The processes noted are all in support of clear allocation of resources.

Travis Dalton: They will enable us to make sound and timely decisions around expense and capital outlays that deliver better quarterly performance and create long-term value. They will help us prioritize investments in those products and initiatives that are most important to growth and have the highest market potential over time, serve the entire healthcare ecosystem, and more aggressively deliver value for TPAs, brokers, consultants, and plan sponsors, are key products that serve our core clients. We held the first leadership interlock with our new product lifecycle management team.

Speaker Change: They will help us prioritize investments in those products and initiatives that are most important to growth and have the highest market potential over time. We are investing today in a few key areas.

Travis Dalton: We're investing today in a few key areas and hand to capabilities for our core clients as identified at the start of this year. We will continue to seek opportunities to better serve our clients. This is job number one. Investing in our data architecture provides flexibility and extensibility in our technology stack. We will be able to more quickly iterate on internal projects and also potentially serve a platform-based ecosystem over time. Price transparency products and analytics serve the entire healthcare ecosystem. Assets acquired through our BST acquisition give us a strategic advantage. We have integrated BST to get more focus and will be aggressive in pursuit of this market opportunity.

Speaker Change: and enhance capabilities for our core clients.

Speaker Change: As identified at the start of this year, we will continue to seek opportunities to better serve our clients. This is job number one.

Speaker Change: Price Transparency Products and Analytics serve the entire healthcare ecosystem.

Speaker Change: Assets acquired through our BST acquisition give us a strategic advantage. We've integrated BST to get more focus and we'll be aggressive in pursuit of this market opportunity.

Travis Dalton: Internal automation with AI, starting with our NSA processes and continuing with other backlog of projects. More leverage value as we progress.

Speaker Change: Internal Automation with AI, starting with our NSA processes and continuing with other backlog of projects.

Travis Dalton: This is only the beginning. Over time, all of this will allow us to increase our total addressable market and diversify our customer base as we serve our national and regional payer clients. More aggressively deliver value for TPA's brokers, consultants, and plan sponsors. Address opportunities in provider markets and deliver a data platformer analytics vision that meaningfully expands the capabilities we offer in all of these markets.

Speaker Change: More leveraged value as we progress. This is only the beginning.

Travis Dalton: We will be persistent in driving better results. I am pleased with the energy and determination of the organization, which has already resolved in better progress, the support growth demonstrated by several examples. We added four new logos in Q2 who had a key TPA win. Sales are up 8% year over year, and our pipeline has grown by double digits in the first half, even with headwinds associated with the exogenous events that I mentioned earlier. Our plan optics product suite has been recognized with another key award for data and analytics, and we continue to close sales with plan optics and ben insight, including two additional in the second quarter across multiple sales.

Speaker Change: We will be persistent in driving better results. I am pleased with the energy and determination of the organization, which has already resulted in better progress to support growth, demonstrated by several examples.

Speaker Change: Our PlanOptics product suite has been recognized with another key award for data and analytics.

Speaker Change: And we continue to close sales with PlanOptics and Ben Insight, including two additional in the second quarter across multiple sales channels.

Travis Dalton: We closed our first provider client with Been Insights in predictive risk models.

Travis Dalton: I will also be a keynote speaker at the Critical Access Hospital Conference hosted by the National Neural Health Association, a highlight our transparency products and analytics. If we want to control costs and healthcare, enabling autonomy and access in rural America is a key component. We believe that we can help in many ways.

Speaker Change: I will also be a keynote speaker at the Critical Access Hospital Conference hosted by the National Rural Health Association to highlight our transparency products and analytics.

Speaker Change: If we want to control costs in healthcare, enabling autonomy and access in rural America is a key component. We believe that we can help in many ways. We are focused and on track with our development roadmap for key products that serve our core client base.

Travis Dalton: We are focusing on track with our development roadmap for key products that serve our core client base. We held the first leadership interlock with our new product life cycle management on one with our teams identified 15 new product ideas and over 30 additional enhancements for consideration. We're moving quickly to evaluate those concepts against client needs and market potential to prioritize our efforts and maximize results.

Speaker Change: With our teams identified 15 new product ideas and over 30 additional enhancements for consideration.

Speaker Change: We are moving quickly to evaluate those concepts against client needs and market potential to prioritize our efforts and maximize results.

Travis Dalton: Likewise, we will continue to advance our partnership opportunities to extend market reach. As I mentioned, we added new senior talent in the quarter that we are able to attract these world-class professionals and that they want to be part of our journey is a strong endorsement of the company and the opportunity we have to unlock meaningful value over time.

Travis Dalton: As I mentioned, we added new senior talent in the quarter. That we are able to attract these world-class professionals and that they want to be part of our journey is a strong endorsement of the company and the opportunity we have to unlock meaningful value. We are working tirelessly to deliver a clear strategy for predictable and sustainable growth. As disclosed this morning, Jim has decided to leave MultiPln but will be staying with us in a strategic advisory role through the end of the year. Turning to revenues by service line is shown on page five of the supplemental deck. Relative to Q124, network-based revenues declined by 0.9% sequentially, or about half a million dollars.

Travis Dalton: We know we operate in a competitive environment and ever-changing environment. Our strategy, systems, processes, and people have to be ready and able to succeed in that environment. That will require transformations. We will take it straight on, and we have the determination to do so.

Speaker Change: We know we operate in a competitive environment, an ever-changing environment. Our strategy, systems, processes, and people have to be ready and able to succeed in that environment. That will require transformation. We will take it straight on, and we have the determination to do so.

Travis Dalton: In summary, as I noted at the outset, we realize our financial results have not met expectations. As a management team, we will confront that with brutal honesty. We know what work to do, and I am confident over time, and we have some that we can and will achieve for sustainable results.

Speaker Change: We know what work to do, and I am confident over time, and we have some, that we can and will achieve sustainable results.

Travis Dalton: We are working tirelessly to deliver a clear strategy for predictable and sustainable growth. As we move forward, I will communicate more detail around our strategic and capital allocation plan. One that is underpinned by the investment discipline, organizational alignment, and execution focus needed to achieve that plan. And it's supported by investor disclosure that will allow you to hold us accountable.

Speaker Change: We are working tirelessly to deliver a clear strategy for predictable and sustainable growth.

Speaker Change: As we move forward, I will communicate more detail around our strategic and capital allocation plan.

Speaker Change: One that is underpinned by the investment discipline, organizational alignment and execution focus needed to achieve that plan. And it's supported by investor disclosure that will allow you to hold us accountable.

Travis Dalton: I look forward to demonstrating all of us to you and improving our say-do ratio. You are what your record says you are. Ours needs to get better, and we will be relentless.

Speaker Change: You are what your record says you are. Ours needs to get better, and we will be relentless.

Travis Dalton: I would like to turn it over to Jim to cover the details of our results.

Travis Dalton: As this goes this morning, Jim has decided to leave MultiPlan, but we'll be staying with us in a strategic advisory role through the end of the year. Jim has been uncompromising pursuit of service excellence for our clients and bodies are for values and is frankly just a straight shooter. The board of directors and I can't thank him enough.

Speaker Change: I would like to turn it over to Jim to cover the details of our results.

Travis Dalton: We will be welcoming Doug Harris as our CSL starting August 5th, and Doug will work closely with Jim through the end of the year to ensure a smooth transition. I have worked with Doug previously, and I'm confident he is the right person to help carry us forward with our operating plan and has the execution skills we need to drive sustainable growth. I'm excited to work closely with him on realizing our potential.

Speaker Change: The Board of Directors and I can't thank him enough. We will be welcoming Doug Garris as our CFO starting August 5th, and Doug will work closely with Jim through the end of the year to ensure a smooth transition.

Jim Head: Let me turn it over to Jim.

Jim Head: Thanks, Travis, and good morning, everyone. I would like to reiterate what Travis said. While growth is taking longer to materialize than we expected, we are making progress, and we remain confident in the company's medium and long-term prospects. Today, I will walk through the financial results for the second quarter of 2024.

Jim: Thanks, Travis, and good morning, everyone. I would like to reiterate what Travis said. While growth is taking longer to materialize than we expected, we are making progress and we remain confident in the company's medium and long-term prospects.

Jim Head: I will then turn her out, look for the second half, and provide updated guidance for full year 24. And finally, I'll close with a review of our balance sheet and capital allocation. The shone on page four of the supplemental deck, second quarter revenue was 233.5 million, a decrease of 1.9 percent from Q2 23, and effectively flat sequentially. Our revenues fell just below the line of our guidance range for the quarter, as the solid recovery and volumes was offset by volatility in our revenue yield, and by slower than anticipated sales of our new products and services.

Doug Garris: Today, I will walk through the financial results for the second quarter of 2024. I will then turn to our outlet for the second half and provide updated guidance for full year 24.

Speaker Change: And finally, I'll close with a review of our balance sheet and capital allocation.

Speaker Change: As shown on page 4 of the supplemental deck, second quarter revenue is $233.5 million, a decrease of 1.9% from Q2'23, and effectively flat sequentially.

Speaker Change: Our revenues fell just below the line of our guidance range for the quarter, as a solid recovery in volumes was offset by volatility in our revenue yield, and by slower than anticipated sales of our new products and services.

Jim Head: Turning to revenues by service line is shown on page five of the supplemental deck. Relative to Q124, network-based revenues declined 0.9 percent sequentially, or about half a million dollars, driven by continued softness in our complimentary network and property and casualty businesses. Our analytics-based revenues were essentially flat sequentially, with strengthened data eyesight offset by softness in our NSA volumes, including a triton related to a major employer plan served by one of our larger ASO clients. Our payment and revenue integrity revenues declined 1.4 percent sequentially, driven by softness in our prepayment clinical negotiation business, offset by continued strong growth in our post pay portfolio.

Speaker Change: Turning to revenues by service line is shown on page 5 of the supplemental deck. Relative to Q124, network-based revenues declined 0.9 percent sequentially, or about a half a million dollars, driven by continued softness in our complementary network and property and casualty businesses.

Travis Dalton: Despite continued softness in our complementary network and property and casualty, during the second quarter, we experienced solid growth in volumes of billed charges and identified potential savings, with June showing recovery from the clearinghouse cyber outage that continued to impact our claims flows through April and May. As shown on page 7 of the supplemental deck, total second quarter bill charges increased 9% sequentially to $45.3 billion, and identified potential savings increased 8% sequentially to $6.2 billion.

Speaker Change: Our analytics-based revenues were essentially flat sequentially, with strength and data eyesight offset by softness in our NSA volumes, including attrition related to a major employer plan served by one of our larger ASO clients.

Speaker Change: Our payment and revenue integrity revenues declined 1.4% sequentially, driven by softness in our prepayment clinical negotiation business, offset by continued strong growth in our post-pay portfolio.

Jim Head: Versus the prior year quarter, network-based revenues declined 20 percent; analytics-based revenues grew 5.6 percent, and payment and revenue integrity revenues declined 5.3 percent. Excluding a 3.8 million contribution to revenues from BST, which is reported in our analytics-based revenues, second quarter consolidated revenues were 229.7 million, effectively flat sequentially and down 2.6 percent from the prior year quarter. During the second quarter, we experienced solid growth and volumes of build charges and identified potential savings, with June showing recovery from the clearinghouse cyber outage that continued to impact our claims flows through April and May. The shown on page 7 of the supplemental deck, total second quarter build charges increased 9 percent sequentially to 45.3 billion, and identified potential savings increased 8 percent sequentially to 6.2 billion.

Speaker Change: versus the prior year quarter, network-based revenues declined 20%, analytics-based revenues grew 5.6%, and payment and revenue integrity revenues declined 5.3%.

Speaker Change: Excluding a $3.8 million contribution to revenues from BST, which is reported in our analytics-based revenues, second quarter consolidated revenues were $229.7 million, effectively flat sequentially and down 2.6% from the prior year quarter.

Speaker Change: During the second quarter, we experienced solid growth in volumes of billed charges and identified potential savings, with June showing recovery from the clearinghouse cyber outage that continued to impact our claims flows through April and May.

Speaker Change: As shown on page 7 of the supplemental deck, total second quarter bill charges increased 9% sequentially to $45.3 billion, and identified potential savings increased 8% sequentially to $6.2 billion.

Jim Head: The shown on page 8, in our core percentage of savings revenue model, identified potential savings increased 3 percent sequentially to 4.4 billion. With respect to the utilization environment, build charges from both facilities and physicians were up sequentially. We also note the data from some of the publicly traded hospital systems, which suggested reasonable sequential strength in second quarter inpatient and outpatient surgeries, but more sluggish trends in emergency room visits, which on balance is a positive signal for our forward volumes given our typical claims lag. The sequential increase in our volumes is mostly offset by a decline in revenues as a percentage of identified savings, or what we call revenue yield.

Speaker Change: As shown on page 8 in our Core Percentage of Savings Revenue Model, identified potential savings increased 3% sequentially to $4.4 billion.

Travis Dalton: As shown on page 8 in our Core Percentage of Savings Revenue Model, identified potential savings increased 3% sequentially to $4.4 billion. However, the sequential increase in our volumes was mostly offset by a decline in revenues as a percentage of identified savings, or what we call revenue yield. Adjusted EBITDA was $146.7 million in Q2-24, down 3.9% from $152.7 million in the prior year quarter and down 0.1% from $146.8 million in Q

Speaker Change: With respect to the utilization environment, bill charges from both facilities and physicians were up sequentially.

Speaker Change: We also note the data from some of the publicly traded hospital systems, which suggested reasonable sequential strength in second quarter inpatient and outpatient surgeries, but more sluggish trends in emergency room visits, which on balance is a positive signal for our forward volumes given our typical claims lag.

Speaker Change: The sequential increase in our volumes is mostly offset by a decline in revenues as a percentage of identified savings, or what we call revenue yield.

Jim Head: As shown on page 8 of the supplemental deck, our revenue yield declined about 31 basis points sequentially for the overall business, which includes both PCAVE and PEPM. In our core percentage of savings revenue model, which is approximately 90 percent of our revenues, our revenue yields fell about 14 basis points in the quarter, which had an impact of about 6.3 million to our revenues. This included about 11 basis points or about 4.9 million of revenue decline from yield shifts. At about 3 basis points or 1.5 million of incremental decline from customer credits that ended in Q2.

Speaker Change: As shown on page 8 of the supplemental deck, our revenue yield declined about 31 basis points sequentially for the overall business, which includes both PSAVE and PEPM.

Speaker Change: In our core percentage of savings revenue model, which is approximately 90% of our revenues, our revenue yields fell about 14 basis points in the quarter, which had an impact of about 6.3 million to our revenues.

Speaker Change: This included about 11 basis points, or about $4.9 million of revenue decline from yield shifts.

Speaker Change: And about three basis points, or 1.5 million, of incremental decline from customer credits that ended in Q2.

Jim Head: Notably, none of the decline in our piece of revenue yield was related to any contract changes with our customers. It was yield and mixed behavior within existing contracts. Turning to expenses, second quarter adjusted EBITDA expenses were 86.8 million, increasing 1.5 million from the prior year quarter and down 0.9 million sequentially. The increase of 1.5 million over Q2.23 was primarily due to increases in personnel expenses related to increased employee headcount and year-over-year increases in compensation and related benefits, including increasing increases in personnel costs from the acquisition of BSD. For the sequential comparison, the 0.9 million decrease in adjusted EBITDA expenses reflected tight expense controls.

Speaker Change: Notably, none of the decline in our PSAVE revenue yield was related to any contract changes with our customers. It was yield and mixed behavior within existing contracts.

Speaker Change: Turning to expenses, second quarter adjusted EBITDA expenses were $86.8 million, increasing $1.5 million from the prior year quarter and down $0.9 million sequentially.

Speaker Change: The increase of $1.5 million over Q2-23 was primarily due to increases in personnel expenses related to increased employee headcount and year-over-year increases in compensation and related benefits. For more information, visit www.fema.gov

Speaker Change: Including increases in personnel costs from the acquisition of BST.

Speaker Change: For the sequential comparison, the $0.9 million decrease in adjusted EBITDA expenses reflected tight expense controls.

Jim Head: The adjusted EBITDA was 146.7 million in Q2.24, down 3.9% from 152.7 million in the prior year quarter and down 0.1% from 146.8 million in Q1. Our Q2 adjusted EBITDA was slightly above the lower end of our guidance range. The adjusted EBITDA margin was 62.8% in Q2.24, down 20 basis points from 62.6% in Q1 and down from 64.2% in the prior year quarter. Our second quarter margin was modestly below the 63 to 64% range mentioned in our prior commentary, and like adjusted EBITDA, reflected the combination of lower than anticipated revenues and lower costs.

Speaker Change: Adjusted EBITDA was $146.7 million in Q2-24, down 3.9% from $152.7 million in the prior year quarter, and down 0.1% from $146.8 million in Q1.

Speaker Change: Our Q2 Adjusted EBITDA was slightly...

Speaker Change: above the lower end of our guidance range.

Speaker Change: Adjusted EBITDA margin was 62.8% in Q2-24, up 20 basis points from 62.6% in Q1, and down from 64.2% in the prior year quarter.

Travis Dalton: Our second quarter margin was modestly below the 63 to 64 percent range mentioned in our prior commentary and, like adjusted EBITDA, reflected the combination of lower than anticipated revenues and lower costs, reflected sluggish growth in our core business and slower than anticipated new product sales. We now expect Adjusted EBITDA expenses to be closer to $360 million, down from our prior projection of about $370 million, reflecting expense reductions as we seek to manage our Adjusted EBITDA margin while maintaining investments and projects that are expected to generate revenue growth.

Speaker Change: Our second quarter margin was modestly below the 63 to 64 percent range mentioned in our prior commentary and, like adjusted EBITDA, reflected the combination of lower than anticipated revenues and lower costs.

Jim Head: Moving on to our outlook is shown on page 9 of the supplemental earnings deck. We have revised our full year 2024 revenue guidance to 935 to 955 million versus our prior guidance of 1.0 to 1.03 billion, reflecting sluggish growth in our core business and slower than anticipated new product sales. In summary, our revised full year 2024 revenue guidance assumes only a modest uplift in our core business in the second half after a difficult first half and muted growth from new product sales. Moving to our revised adjusted EBITDA guidance, we are reducing our estimate to 580 to 595 million.

Speaker Change: Moving on to our Outlook, as shown on page 9 of the Supplemental Earnings Stack, we have revised our full year 2024 revenue guidance to $935 to $955 million versus our prior guidance of $1.0 to $1.03 billion.

Speaker Change: Reflecting sluggish growth in our core business and slower than anticipated new product sales.

Speaker Change: In summary, our revised full-year 2024 Revenue Guidance assumes only a modest uplift in our core business in the second half, after a difficult first half, and muted growth from new product sales.

Speaker Change: Moving to our revised adjusted EBITDA guidance, we are reducing our estimate to 580 to 595 million.

Jim Head: We now expect the adjusted EBITDA expenses to be closer to 360 million, down from our prior projection of about 370 million, reflecting expense reductions as we seek to manage our adjusted EBITDA margin while maintaining investments and projects that are expected to generate revenue growth. The combination of a revenue and adjusted EBITDA assumptions implies an adjusted EBITDA margin of about 62% for full year 2024, slightly below prior expectations. Turning to our third quarter guidance, it is outlined on page 10 of the supplemental deck. We anticipate revenues of 230 to 245 million and adjust the EBITDA of 140 to 155.

Speaker Change: We now expect adjusted EBITDA expenses to be closer to $360 million, down from our prior projection of about $370 million, reflecting expense reductions as we seek to manage our adjusted EBITDA margin, while maintaining investments and projects that are expected to generate revenue growth.

Speaker Change: The combination of our revenue-adjusted EBITDA assumptions implies an adjusted EBITDA margin of about 62% for full year 2024, slightly below prior expectations.

Speaker Change: Turning to our third quarter guidance, as outlined on page 10 of the supplemental deck, we anticipate revenues of $230 to $245 million and adjusted EBITDA of $140 to $155 million.

Jim Head: Million. And as Travis mentioned, we now expect future attrition related to a specific program at a larger client, which will impact the results starting in 2025. While we're not providing guidance for 2025 today, we do that in February each year, typically. In the interest of transparency, we expect this program attrition to pose an approximate 3% to have, excuse me, 3% headwind to revenues next year. But it's also, as Travis mentioned, with the exception of intricional overhang related to one of our larger clients, we've been growing at a mid-single digit rate across the remainder of our customer base.

Speaker Change: And as Travis mentioned, we now expect future attrition related to a specific program at a larger client, which will impact the results starting in 2025.

Speaker Change: While we're not providing guidance for 2025 today, we do that in February each year, typically. In the interest of transparency, we expect this program attrition to pose an approximate 3% headwind to revenues next year.

Travis Dalton: With the exception of a nutrition overhang related to one of our larger clients, we've been growing at a mid-single-digit rate across the remainder of our customer base. While we now expect this additional attrition to constrain growth until mid-25, this should clear the way for us to show ongoing growth in the core. As shown on page 13 of the supplemental deck, we ended the quarter with $49 million of unrestricted cash, and we did not buy any securities this quarter.

Travis: But it's also, as Travis mentioned, with the exception of nutrition overhang related to one of our larger clients, we've been growing at a mid-single-digit rate across the remainder of our customer base.

Jim Head: While we now expect this additional attrition to constrain growth until mid-25, this should clear the way for us to show on-growing growth in the core.

Travis: While we now expect this additional attrition to constrain growth until mid-25, this should clear the way for us to show ongoing growth in the core.

Jim Head: As you are aware from our press release, we again conduct an impairment test in the second quarter of 2024, which incorporates current financial market conditions, including our share price, market discount rates, forecast revisions, and other factors. Based on this test, the estimated fair value of our goodwill was less than our caring value. As a result, we recorded a non-cash impairment charge of 553.7 million and recognized the charge in our GAAP earnings results. Turning to the balance sheet and capital allocation, our operating cash flow was 18.5 million in the second quarter and levered free cash flow with a negative 7.0 million.

Speaker Change: As you are aware from our press release, we again conduct an impairment test in the second quarter of 2024, which incorporates current financial market conditions, including our share price, market discount rates,

Speaker Change: Forecast revisions and other factors.

Speaker Change: Based on this test, the estimated fair value of our goodwill was less than our carrying value. As a result, we recorded a non-cash impairment charge of $553.7 million and recognized the charge in our GAAP earnings results.

Speaker Change: Turning to the balance sheet and capital allocation. Our operating cash flow was $18.5 million in the second quarter, and levered free cash flow was a negative $7.0 million.

Jim Head: As a reminder, the second and fourth quarters are typically our lower quarters for cash flow given the timing of our interest in tax payments. As shown on page 13 of the supplemental deck, we ended the quarter with 49 million of unrestricted cash, and we did not buy any securities this quarter. That of cash, our total and operating leverage ratios were 7.5 and 5.4, respectively. Our long-term capital priorities remain the same. Our highest priority remains investing in the business to drive growth and long-term value. You should expect us to continue making critical organic investments to support our platform, including our new core products and our data and decision science service line.

Speaker Change: As a reminder, the second and fourth quarters are typically our lower quarters for cash flow given the timing of our interest and tax payments.

Speaker Change: As shown on page 13 of the supplemental deck, we ended the quarter with $49 million of unrestricted cash and we did not buy any securities this quarter.

Speaker Change: Net of cash or total and operating leverage ratios were 7.5 and 5.4 respectively.

Travis Dalton: Our long-term capital priorities remain the same. Our highest priority remains investing in the business to drive growth and long-term value. You should expect us to continue making critical organic investments to support our platform, including our new core products and our data and decision science services. In terms of our capital structure, we've been consistent.

Speaker Change: Our long-term capital priorities remain the same. Our highest priority remains investing in the business to drive growth and long-term value. You should expect us to continue making critical organic investments to support our platform, including our new core products and our data and decision science service line.

Jim Head: With our remaining cash flow, we will primarily focus on debt reduction. While our long-term priorities have not changed, following the acquisition of BST, in the near term, we will emphasize organic investments in debt reduction and de-emphasize M&A and share repurchases as we focus on debt retirement. In terms of our capital structure, we've been consistent. We have time, we have flexibility, and we will continue to be thoughtful and circumspect in our approach.

Speaker Change: With our remaining cash flow, we will primarily focus on debt reduction.

Speaker Change: While our long-term priorities have not changed following the acquisition of BST, in the near term we will emphasize organic investments and debt reduction, and de-emphasize M&A and share repurchases as we focus on debt retirement.

Jim Head: We have time, we have flexibility, and we will continue to be thoughtful and circumspect in our approach. However, as Travis mentioned, this is an important moment for us on a multi-year journey. Travis and I are committed to creating a seamless transition for Doug, and I plan to remain on until the end of the year to make sure that happens. That brings me to the end of my comments.

Speaker Change: In terms of our capital structure, we've been consistent.

Speaker Change: We have time, we have flexibility, and we will continue to be thoughtful and circumspect in our approach.

Jim Head: Finally, as to the news, is to why I'm leaving that I'm leaving Multi-Plan and why. I've been clear that I believe in this company. You've heard this from me many times. I believe in its people and its strategy, and I'm confident we're going to emerge from our transformation as a stronger, more diversified, and sustainable company. However, as Travis mentioned, this is an important moment for us in a multi-year journey. Our transformation will require a few more years to complete, and on a personal note, that timing doesn't fit with my horizon. This company needs a CFO; we can see it all the way through.

Speaker Change: Finally.

Speaker Change: As to the news as to why I'm leaving, that I'm leaving MultiPln and why, I've been clear that I believe in this company. You've heard this from me many times. I believe in its people and its strategy and I'm confident we're going to emerge from our transformation as a stronger, more diversified, and sustainable company.

Speaker Change: However, as Travis mentioned, this is an important moment for us in a multi-year journey.

Travis: Our transformation will require a few more years to complete.

Travis: And on a personal note, that timing doesn't fit with my horizon.

Jim Head: Travis and I are committed to creating a seamless transition for Doug, and I plan to remain until the end of the year and make sure that happens. I look forward to catching up with many of you in the coming days as we go through our quarterly earnings and on a personal basis. That brings me to the end of my comments. I'll turn it back over to you, Travis.

Travis: This company needs a CFO , we can see it all the way through.

Speaker Change: Travis and I are committed to creating a seamless transition for Doug and I plan to remain on until the end of the year to make sure that happens.

Doug Garris: I look forward to catching up with many of you in the coming days as we go through our quarterly earnings and on a personal basis.

Travis Dalton: I'll turn it back over to you, Travis. Thank you, Jim. Let me just reiterate my belief in our path forward. This is a transformational journey, but we have a compelling vision that's emerging and a strategy for the future as a data and technology-driven organization that will continue to bring value for our clients and achieve sustainable growth. I look forward to sharing our progress with you very clearly in the coming quarters. Operator, would you kindly open up the call for any questions? Thank you. If you change your mind, please dial a star followed by two to exit the queue. And finally, when preparing to ask your question, please ensure that your phone is unmuted locally.

Speaker Change: That brings me to the end of my comments. I'll turn it back over to you, Travis.

Travis Dalton: Thank you, Jim. Before I open the call to questions, let me just reiterate my belief in our path forward. This is a transformational journey, but we have a compelling vision that's forming and a strategy for the future as a data and technology-led organization that will continue to bring value for our clients and achieve sustainable growth. I look forward to sharing our progress with you very clearly in the coming quarters, operator.

Travis: Thank you, Jim.

Travis: Before I open the call to questions...

Speaker Change: Let me just reiterate my belief in our path forward. This is a transformational journey, but we have a compelling vision that's forming, and a strategy for the future as a data and technology-led organization that will continue to bring value for our clients and achieve sustainable growth.

Travis: I look forward to sharing our progress with you very clearly in the coming quarters. Operator, would you kindly open up the call for any questions? Thank you.

Unknown Executive: Would you kindly open up the call for any questions? Thank you. Certainly, if you would like to ask a question, please dial StarFlood by one on your telephone keypad now. If you change your mind, please dial StarFlood by two to exit the queue. And finally, when preparing to ask your question, please ensure that your phone is unmuted locally.

Speaker Change: Certainly, if you would like to ask a question, please dial star followed by 1 on your telephone keypad now. If you change your mind, please dial star followed by 2 to exit the queue. And finally, when preparing to ask your question, please ensure that your phone is unmuted locally.

Joshua Raskin: And our first question today is from the line of Joshua Raskin of Neffron Research.

Speaker Change: And our first question today is from the line of Joshua Raskin of Nephron Research. Please go ahead. Your line is open.

Joshua Raskin: Please go ahead. Your line is open. Thanks. I got a couple here.

Jim Head: So just the first, well, first I should start with the thanks to Jim for all of his help and best wishes on whatever, whatever your next endeavor is. My question or first question is just guidance for the second half. It implies the decline in EBITDA of about 5%. You know, an EBITDA was also down about 5% over you in the first half. I just would have expected the second half to improve in light of the disruption from Change Healthcare. I'd be curious if that's still 5 to 6 million. And then just, you know, potential cost savings and initiatives.

Joshua Raskin: Thanks, I've got a couple here. So just the first, well first I should start with the thanks to Jim for all of his help and best wishes on whatever, whatever your next endeavor is.

Joshua Raskin: My first question is just guidance for the second half. It implies a decline in EBITDA of about 5%, and EBITDA was also down about 5% year-over-year in the first half. I just would have expected.

Travis: The second half to improve in light of the disruption from change health care. I'd be curious if that's still 5 to 6 million. And then just potential cost savings and initiatives. So we're just curious in the second half, what's the offset there?

Jim Head: So just curious in the second half. What's the offset there? Yeah.

Jim Head: And Travis, I'll take this one. Josh, thanks for the kind words. The just a couple things. Let's just maybe talk about the two components of the second half. The revenue side, you know, you've seen some strength and volumes as we've kind of gone through Q1 and Q2. It's rebounded a little bit. But I think we're being cautious a little bit. There's been volatility on the revenue yield side of things. And so we're calling a second half that is modestly better in the core. I think one of the things that is coming up softer is just new sales.

Travis: Yep, and Travis, I'll take this one. Josh, thanks for the kind words. The, just a couple things. Let's just maybe talk about the two components of the second half.

Unknown Executive: On the revenue side, you know, you've seen some strength in volumes as we've kind of gone through Q1 and Q2. It's rebounded a little bit. But I think we're being cautious a little bit. There's been volatility on the revenue yield side of things. And so we're calling this, you know, a second half of that is modestly better in the core. I think one of the things that is, You know, this is Travis on that, right?

Speaker Change: The revenue side, you know, you've seen some strength in volumes as we've kind of gone through Q1 and Q2. It's rebounded a little bit, but I think we're being cautious a little bit. There's been volatility on the revenue yield side of things.

Joshua Raskin: And so we're calling a, you know, a second half that is modestly better in the core. I think one of the things that is

Jim Head: In some of our growth growth year areas like HST and BST. So we remain a little bit cautious on the top line for the second half as a result of that. On the cost side, when I think about margins, I really kind of think about the cost base that we have, which is relatively fixed. Which is you're going to see costs pretty much the same, relatively flat in the second half, maybe a tick a little bit. But again, we're judiciously making some investments in the future. We're tightening our costs, but maintaining the investment level because we want to. We're committed to these products.

Speaker Change: is coming up soft or is just new sales?

Speaker Change: in some of our growth growthier areas like like HST and BST. So we remain a little bit cautious on the on the top line for the second half as a result of that.

Speaker Change: On the cost side...

Joshua Raskin: When I think about margins, I really kind of think about the cost base that we have, which is relatively fixed, which is you're going to see costs pretty much the same, relatively flat in the second half, maybe uptick a little bit. But again, we're we're judiciously making some investments in the future. We're tightening our, our costs, but maintaining the investment level.

Jim Head: And there's still a little bit of ways to go. And there's a little bit of just absorbing the full run rate in the second half of BST. The first half didn't have too much of BST in it last year. So this year, you can kind of track our quarterly progression. And so that's the expense side of things. But I think we're just being given where we're at some of the volatility, both in the external environment, as well as some volatility revenue yields. We're just being cautious on the second half. Now, okay, that's helpful.

Joshua Raskin: because we're committed to these products and there's still a little bit of ways to go. And there's a little bit of just absorbing the full run rate in the second half of BST. The first half didn't have too much of BST in it.

Joshua Raskin: last year. So this year, you can kind of track our quarterly progression. And so that's

Joshua Raskin: That's the expense side of things, but I think we're just being, given where we're at, some of the volatility, both in the external environment, as well as some volatility of revenue yields, we're just being cautious on the second half.

Jerry Hogg: And then, you know, you mentioned slower commercial traction on the new products. I'm just curious, is that, does that mean more customers are saying no, or does that mean that the sales cycle is just taking longer? Yeah, hey, this is Jerry Hogg.

Speaker Change: Okay, okay, that's helpful. And then, you know, you mentioned slower commercial traction on the new products. I'm just curious, does that mean more customers are saying no, or does that mean that the sales cycle is just taking longer?

Jerry Hogg: Mainly there, we're talking about our HSD or value-driven health plan pipeline and transactions. The conversion of sales into revenue is a little longer than was budgeted, but the pipeline is robust and sales are continuing. It's just the conversion into revenue. Okay, and then the last one, that 3% head went to revenues in 2025, you know, whatever, 25 to 30 million dollars.

Joshua Raskin: Yeah, hey, this is Jerry Hogg. Mainly there, we're talking about our HST or value-driven health plan pipeline and transactions.

Joshua Raskin: The conversion of sales into revenue is a little longer than was budgeted, but the pipeline is robust and sales are continuing. It's just the conversion into revenue.

Speaker Change: Okay, okay. And then the last one, that 3% headwind to revenues in 2025, you know, call it whatever, $25 to $30 million. Could you just give us some more color on that? I'm not sure I understood if that was a large health plan, or if it was a customer of a health plan. And then what was the decision? What products were they buying? You know, what, what led to the departure?

Unknown Executive: Could you just give us more color on that?

Unknown Executive: I'm not sure I understood if that was a large health plan, or if it was a customer of a health plan. And then, what was the decision, what products were they buying, you know, what led to the departure? Yeah, I'm happy to jump. Okay, go ahead. Now, I think, Josh, I think just to kind of we don't do a lot of discussion, as you know, historically, it's, you know, it's one of our larger clients, be it the program inside, inside the overall relationship, and they're going to kind of move in a different direction strategically. So we, you know, in the interest of being transparent, we wanted to call that out, but we don't really talk anymore specifically about that. But we didn't want, we didn't want that to, you know, to kind of come as news in the coming year as we are getting the entire picture put together.

Joshua Raskin: Yeah, I'm happy to jump in. Travis, I'll take this. Yeah, go ahead. Okay, go ahead.

Jim Head: You know, this is the other part on that, right? We're, you know, we're confident in our core, as I said during the script. We feel good about our price, the value. And you know, we're seeing, we're seeing good delivering; we're seeing actually some growth inside of our core national counts. I think these are strategic things, not in relation to the value we bring. That said, you know, we always are seeking to bring more value to clients to ensure that we continue to grow that space. So that program had a change related to strategy was impactful to us, and we thought it was important that we just say that for what it is, but also calm, you know, create some calm that we're very confident in our core set of clients and the capabilities and the value we bring to them on a go forward basis.

Travis Dalton: We're, you know, we're confident in our core. As I said during the script, we feel good about our price and the value. And, you know, we're seeing good delivery, we're seeing actually some growth inside of our core national accounts, which creates some calm that we're very confident in our core set of clients and the capabilities and the value we bring to them on a go forward basis. Hi, thanks for taking the question.

Speaker Change: So that programmatic change related to strategy was impactful to us, and we thought it was important that we just say that for what it is, but also,

Unknown Executive: Okay, that is understood.

Speaker Change: Okay, got it, understood.

Daniel Grosslight: Our next question today is from the line of Daniel gross life of city group, please go ahead your line as I see. Hi, I think you're taking the question, and I'll echo Josh's comments on it's been great working with you, Jim. Hope to continue our conversation in the future. I guess my first question really is on revenue yield and end of all till the until you've seen there really since the first quarter of 2022. Every quarter basically has been a sequential decline in revenue yield. And while you've been, you know, very upfront about the contract rules in 2023 that led to yield declines, I'm curious if you could provide a little more detail from the current volatility.

Unknown Executive: And I'll echo Josh's comments on it's been great working with you, Jim. I hope to continue our conversations in the future. I guess my first question really is on revenue yield and the volatility you've seen there, really, since the first quarter of 2022. Every quarter basically has been a sequential decline in revenue yield. And while you've been, you know, very upfront about the contract renewal in 2023, that has led to yield declines. And I'm curious if you could provide a little more detail on the current volatility.

Unknown Executive: I'm not quite sure what kind of these net yield shifts and credits actually mean. So maybe if you can just provide a little more detail on that and when you anticipate those yield shifts and volatility on a base. Yeah, yeah. And so maybe we're gonna feel a little less great about the yield part, but I think we're feeling better about the volume. You saw that in the quarter.

Daniel Grosslight: I'm not quite sure what kind of these net yield shifts and credit actually mean for maybe if you can just provide a little more detail on that and when you anticipate those yield shifts and involuntarily to a base. Yeah, and so just maybe to kind of peel this back a little bit, you know, the kind of the master service agreements and the contract rates on it, nothing's changed on that. But underneath it, there's programs, there's clients, there's, you know, it's kind of yield behavior, there's accruals, et cetera, that go into the yield. And what we saw in Q2 was, and we get, we have true ups over time.

Jim Head: So the client credits is, I'll address the one, the 1.4 million of client credits. Those were washing through our system; those will be at the end of Q2. We had a little bit of Q1. So hopefully that's going to be a positive shift. But the remainder of that, about 4.8 million, against the same book of savings, if you will, Daniel, is some shifts in business and some normalization of just the overall yield. And so, some of those are going to be a little bit temporal; some will continue. And so, I think the yield is starting to come, you know, come together, probably in the high fours.

Speaker Change: Is some shifts in business and some normalization of just the overall yield and so those are some of those are going to be a little bit temporal. Some will some will continue and so I think the yield is starting to come come together probably in the high fours.

Jim Head: I think we were probably, probably, you know, masking some of the, or not seeing some of the underlying volatility because things were netting out pretty nicely last year and kind of keeping pretty steady. I think there's a little bit more volatility in the yield right now. But the good news is, this volume seems to be, you know, we'll wash through that and volumes picking up pretty nicely. So, I think if we're going to feel a little less great about the yield part, I think we're feeling better about the volume. You saw that in the quarter.

Speaker Change: I think we were probably.

Speaker Change: Probably.

Speaker Change: Masking some of the are not seeing some of the underlying volatility because things were netting out pretty nicely last year and kind of keeping pretty steady I think theres, a little bit more volatility in the yield right now, but the good news is as volume seems to be well.

Speaker Change: Walk through that and volumes picking up pretty nicely.

Speaker Change: I think if we're going to feel a little less great about the yield part I think we're feeling better about the volume you saw that in the quarter.

Jim Head: You know, things are starting to come back a little bit. And that was, that included some of the, you know, the change washing through, and it was still positive, 3% sequential. The other part about it is there's some clients that are pretty rich that have dropped off in terms of the yield, and others that are growing faster that have a slightly lower yield. So, if you see that even inside some products. So, we're just, that's one of the reasons why a little bit cautious is we let some of this stuff wash through, particularly the credits.

Unknown Executive: You know, things are starting to come back a little bit. And that included some of the, you know, the change washing through, and it was still positive 3% sequential. The other part about it is that there are some clients that are pretty rich that have dropped off in terms of the yield, and others that are growing faster that have a slightly lower yield. So you see that even inside some products.

Speaker Change: Things are starting to come back a little bit and that was that included some of the.

Speaker Change: Change washing through and it was still positive 3% sequential the other part about it is there are some clients that are pretty rich that have dropped off in terms of the yield and others that are growing faster that are have a slightly lower yields have you see that even inside some products so well.

Speaker Change: That's one of the reasons why a little bit cautious as we let some of this stuff washed through particularly the credits.

Jim Head: In the first half and before we get to the second half. So we're just being conservative on that.

Speaker Change: In the first half and before we get to the second half. So we're just being being <unk>.

Speaker Change: Conservative on that.

Daniel Grosslight: Okay, okay. And then on your capital structure, obviously you have some, some time there; I think the converts are the most. The nearest term maturity in 2027. I'm curious, though; you know, your five-year plan now takes you outside of that maturity. And so, you know, it might make sense to start addressing that earlier than, than anticipated; rather, you know, rather than waiting. And, you know, I think the bond, all the bonds are trading at a pretty steep discount. Now, so I'm curious, you know, other than repurchasing opportunistically in the open market. Are you having conversations or going open to having conversations with some of your credit investors and in restructuring some of these pieces of debt.

Speaker Change: Okay. Okay.

Speaker Change: On your capital structure, obviously, you have some some time there I think the converts are the most.

Unknown Executive: I'm curious though, you know, your five-year plan now takes you outside of that maturity. And so, you know, it might make sense to start addressing that earlier than anticipated rather than wait, and I think the bond, all the bonds are trading at a pretty steep discount now. So I'm curious, you know, other than repurchasing opportunistically in the open market, are you having conversations with, are you open to having conversations with, some of your credit investors and restructuring some of these pieces of debt?

Speaker Change: The nearest term maturity in 2027.

Speaker Change: I'm curious, though your five year plan now takes you outside of <unk>.

Joshua Raskin: Of that maturity.

Speaker Change: And so.

Speaker Change: It might make sense to start addressing that earlier than than anticipated rather rather than waiting.

Speaker Change: I think the buying all the bonds are trading at a pretty steep discount now so I'm curious other than repurchasing opportunistically in the open market are you having conversations or are you open to having conversations with.

Speaker Change: With some of your credit investors and restructuring.

Speaker Change: <unk>.

Speaker Change: All right.

Speaker Change: Yeah.

Jim Head: Yeah, it's a pretty off-at question, Daniel. You see some swirl in the market around this. But I think there's a couple of fundamental, you know, fundamental things that we'll, we'll say which is, and we've been consistent on this, which is we have time, we have liquidity, and we have flexibility. And that points to, you know, we've got that, but that doesn't mean we are not thinking in the moment. And you know, not kind of dealing with a lot of this world. We had some big swirl around our, you know, in the prices of securities in Q2, just given some of the external news on the legal and Washington front.

Speaker Change: Yes, it's a it's a pretty off.

Unknown Executive: Yeah, it's a pretty often asked question, Daniel. You see some swirl, you know, in the market around this. But I think there's a couple of fundamental things that we'll, we'll say, which is, and we've been consistent on this, which is, we have time, we have liquidity, and we have flexibility. And that points to, you know, we've got that. But that doesn't mean we are not thinking in the moment.

Daniel: Last question, Daniel you see some swirl in the market around this but I think theres a couple of fundamental.

Speaker Change: Fundamental things that will we'll say, which is and we've been consistent on this which is we have time, we have liquidity and we have flexibility and that points to we've got that but that doesn't mean, we are not thinking in the moment.

Unknown Executive: And, you know, not dealing with a lot of the swirl; we had some big swirls around our prices, our securities in Q2, just given some of the external news on the legal and Washington front, that seems to be, you know, kind of abating a little bit in terms of its pressure on those securities. But you should assume that we have been thinking and, all along, since, you know, since the time I joined here, we've always been thinking actively about our capital structure. But we're just going to be thoughtful about it. And we're just not forced to do anything or to act hastily.

Speaker Change: Not.

Speaker Change: <unk> not kind of dealing with a lot of the swirl, we had some big US we're all around.

Speaker Change: And the prices of our securities in Q2, just given some of the external news on the legal and Washington front that seems to be kind of abating, a little bit in terms of its the pressure on those securities but.

Jim Head: That seems to be, you know, kind of abating a little bit in terms of its pressure on those securities. But you should assume that we have been thinking, and all along since, you know, since the time I joined here, we've always been thinking actively about our capital structure. But we're just going to be thoughtful about it. And we're just not forced to do anything or act hastily. That doesn't mean we can't be opportunistic, but we're not going to be forced to act hastily around any of this. And so the other thing I would say is our investors talked to us all the time.

Speaker Change: You should assume that we have been thinking and all along since since the time I joined here, we've always been thinking actively about our capital structure, but we're just going to be thoughtful about it.

Unknown Executive: That doesn't mean we can't be opportunistic, but we're not going to be forced to act hastily around any of this. So the other thing I would say is that our investors talk to us all the time. So it's not like we're dealing with this in a vacuum; we're getting input and quote, unquote, advice from all of our security holders all the time. So it is always an active dialogue. I got it.

Speaker Change: And we're just not forced to do anything or to act hastily that doesn't mean, we can't be opportunistic, but we're not going to be forced to act hastily around any of this so.

Speaker Change: The other thing I would say is our investors talk to us all the time, so it's not like we're.

Daniel Grosslight: So it's not like we're not dealing with this in a vacuum. We're getting input and quote unquote advice from all of our security holders all the time. And so it's always an active dialogue. And last one for me, just on your long-term outlook, it sounded like there wasn't any change in kind of that 4 to 5% core out of network growth and potentially getting to 8 to 10% with some of the newer products. Sounds like it's going to take a little longer than expected, but is that still the expectation in terms of long-term targets. Yeah, and it's interesting; maybe just kind of the fundamental thesis kind of remains intact.

Speaker Change: We're not dealing with this in a vacuum we're getting input and quote unquote.

Speaker Change: Advice from from all of our all of our security holders all the time. So it is always an active dialogue.

Speaker Change: Got it and last one for me just on your long term outlook. It sounded like there wasn't any change in kind of that 4% to 5% core out of network growth and potentially getting to 8% to 10% with some of the newer products.

Unknown Executive: And last one for me, just on your long-term outlook, it sounded like there wasn't any change in kind of that four to 5% core out of network growth and potentially getting to eight to 10% with some of the newer products. Sounds like it's going to take a little longer than expected. But is that still the expectation in terms of the long-term target? Maybe just kind the fundamental thesis kind of remains intact. We've seen, I think, but as we mentioned, but for one client, and Travis, I'll let you expand on that.

Speaker Change: It sounds like it's going to take a little longer than expected, but is that still the expectation in terms of long term targets.

Speaker Change: Yes.

Speaker Change: It's interesting.

Speaker Change: Maybe just to kind of the fundamental thesis remains intact and we have seen I think but as we mentioned but for one client.

Travis Dalton: We've seen, as we mentioned, but for one client, we've had kind of a consistently strong mid-single-digit growth over the last handful of quarters here out of the rest of the business. I would call that the core. So underneath, the results don't look like if underneath that thesis is absolutely intact. And as we continue to bring out new products, it's that additional layer cake that gets you to a higher growth rate. Travis, you should comment on this, but that is the fundamental thesis of how we're doing it.

Speaker Change: We've had kind of a consistently strong mid single digit growth over the last.

Speaker Change: A handful of quarters here out of our the rest of the business I'll call that the core.

Speaker Change: So so underneath the results don't look like about underneath that thesis is absolutely intact and as we continue to bring out new product fits that additional layer cake that gets you to a higher growth rate.

Speaker Change: Travis you should you should comment on this but that is the fundamental thesis of how we're doing it so.

Travis Dalton: So I'm probably not in the best position to do kind of the long-term point of view, but that's the algorithms intact, and Travis, I'll let you explain this. Yeah, I'll just add a few comments. So I think Jim's accurate. I mean, we're in a good position, believe it or not, to grow from a set of core products and clients that are long-time clients. And as we improve organic product capability, we think we can make more stuff. And make more better stuff to put us simply the right child to team. And as we are a first interlock, like I said, we had over 50 new products and enhancements and product ideas that we take over time.

Travis: I'm, probably not in the best position to do kind of a long term.

Travis: Point of view, but that's the algorithms intact and Travis I'll, let you explain.

Travis: Yeah, I'll just add a few comments so I think.

Speaker Change: Tim's accurate I mean, we're.

Unknown Executive: You know, we're in a good position, believe it or not, to grow from a set of core products and clients that are long-term clients. And as we improve our organic product capability, we think we can make more stuff and make more better stuff. To put it simply, that's what I tell the team. And as we had our first interlock, like I said, we had over 50 new product enhancements and product ideas that we think, over time, we can move into that core client base.

Speaker Change: Yes.

Speaker Change: Good position believe it or not to grow from a set of core products and clients that are longtime clients and.

Speaker Change: As we improve our organic product capability, we think we can make more stock and.

Speaker Change: <unk> make more better stuff to put it simply is what I tell the team.

Speaker Change: As we had our first interlock like I said, we had over 50, new product enhancements and product ideas that we think over time.

Travis Dalton: We can move into that core client base. So I think it's still extremely viable. And we're looking for some reasonable growth in that space over time. And beyond that, I'm really confident that we can, you know, I would say expand our total addressable market, particularly do better with TPA's, brokers, consultants, and client sponsors direct. We're going to look at all of our options to be more aggressive. There, I say maybe disruptive at times, because I think we have a right to win with some of our products and capabilities. And then finally, you know, if you expand kind of a concentric circle outward, I think we've got some great opportunities to relate to our analytics business.

Speaker Change: We can move into that core client base. So I think it's still extremely viable and we were looking for some reasonable growth in that space over time beyond that.

Unknown Executive: So I think it's still extremely viable, and we're looking for some reasonable growth in that space over time. Beyond that, you know, I'm really confident that we can, you know, I would say, expand our total addressable market, particularly do better with TPAs, brokers, consultants, and plan sponsors directly. We're going to look at all of our options to be more aggressive, dare I say, maybe disruptive at times, because I think we have a right to win with some of our products and capabilities.

Speaker Change: I'm really confident that we can.

Speaker Change: I would say expand our total addressable market.

Speaker Change: Particularly do better with Tpa brokers consultants and plan sponsors direct.

Speaker Change: We're going to look at all of our options to be more aggressive.

Speaker Change: We're also may be disruptive at times.

Speaker Change: Because I think we have a right to win with some of our product set and capabilities and then finally, if you expand kind of a concentric circle circle outwards I think we've got some great opportunity as it relates to our analytics business.

Unknown Executive: And then finally, you know, if you expand kind of a concentric circle outwards, I think we've got some great opportunities as it relates to our analytics business. We signed a provider client this quarter that was very interested in our risk prediction capabilities, which was super interesting and super repeatable. So, as I said earlier... You know, I believe in what we're doing, and it's going to take a little more time than we thought.

Travis Dalton: We signed a provider client this quarter that was very interested in our risk prediction capabilities, which was super interesting and super repeatable. So, as I said earlier, you know, I believe in what we're doing. And it's going to take a little more time than we thought. And we're going to put a clear view of that down for all of you, which is the work that Jerry is doing. But I am talking and expanding those opportunities and selling better into those markets with more sales talent.

Speaker Change: We signed our provider client this quarter that was very interested in our risk <unk>.

Speaker Change: Prediction capabilities, which was super interesting and Super repeatable.

Speaker Change: So as I said earlier.

Speaker Change: I believe in what we're doing and it's going to take a little more time than we thought and we're going to put a clear view of that down for all of you which is the work that Jerry is doing.

Unknown Executive: And we're going to put a clear view of that down for all of you, which is the work that Cheri is doing. But I am confident in expanding those opportunities and selling better into those markets with more sales power. Yeah, and this is Cheri.

Thompson: But I am Thompson.

Speaker Change: In expanding those opportunities of selling better into those markets with more sales talent.

Unknown Executive: Let me just kind of add to what Travis said. So, you know, I think the kernel of your question in the beginning was, you know, the core of business, right? We have favorable volume trends, and we have a near-term yield trend that's unfavorable, and we described the sources of that yield variance on the downside.

Jerry Hogg: And this is Jerry. Let me just kind of add to what Travis said. So, you know, you're I think the kernel of your question at the beginning was, you know, the core of business, right. We have favorable volume trends. We have a near-term yield trend that's unfavorable. And we described the sources of that yield variance on the downside, but we think after this one programmatic change comes to a conclusion with one client that that yield trend becomes stable and potentially favorable. So whether it's stable or favorable growth trend is is favorable over the long term and thus the core business trajectory follows.

Speaker Change: This is Gerry let me just kind of add to what Trevor said so.

Speaker Change: I think the kernel of your question at the beginning was the core business right. We have favorable volume trends we had.

Speaker Change: Our near term yield trend thats unfavorable.

Speaker Change: And we described the sources of that.

Speaker Change: The variance on the downside, but we think after this one programmatic change.

Speaker Change: It comes to a conclusion with one client that that yield trend becomes stable and potentially favorable so whether it's stable or favorable growth trend is favorable over the long term.

Speaker Change: Thus the core business trajectory follows.

Speaker Change: Got it thank you.

Unknown Executive: Thank you.

Speaker Change: Thank you. Our next question today is from the line of Madison Iron of J P. Morgan. Please go ahead. Your line is now open.

Unknown Executive: But we think after this one programmatic change comes to a conclusion with one client, that yield trend will become stable and potentially favorable. So whether it's stable or favorable, the growth trend is favorable over the long term, and thus, the core business trajectory follows. Thank you. Our next question today is from the line of Madison Aaron of J.P. Morgan. Please go ahead. Your line is now open.

Madison Aron: Our next question today is from the line of Madison Aron of JP Morgan. Please go ahead. Your line is now open. Thanks for taking my questions and Jim. Thank you so much. I have a few questions here.

Madison Iron: Thanks for taking my questions and Jim. Thank you so much.

Unknown Executive: Thanks for taking my questions. And Jim, thank you so much. I guess one, just given the challenges with HST, should we assume that yields are going to be trending closer to or below 1%? And I'm still not sure what gives you the confidence.

Madison Iron: Have a few questions here I guess, one just given the challenges with HST should we assume that the yields.

Madison Aron: I guess one, just given the challenges with HST, should we assume that the yields are going to be trending closer to or below 1%? And I'm still not sure what gives you the confidence and why do you think you have the visibility that we won't see further declines in the Peace App rates that you know, as well as noted earlier, they keep sequentially declining. I just don't know what the bottom is here. It's open that you can walk us through that. Yeah, so let's answer the first question quickly. So on HST, it's a per member per month.

Speaker Change: Good to be trending closer to or below 1% and I'm still not sure. What gives you the confidence and why do you think you have the visibility that we won't see further declines in the <unk> as was noted earlier they keep sequentially declining I just don't know what the bottom is here I was hoping that you could walk us through that.

Unknown Executive: And why do you think you have the visibility that we won't see further declines in the PSAP rates? You know, as noted earlier, they keep sequentially declining. I just don't know what the bottom is here. I was hoping that you could walk us through that. The primary KPI, which is the PSA bill. And Rishi, you're right.

Speaker Change: Yep.

Speaker Change: So, let's let's answer the first question quickly so on HST, it's a per member per month. So if we perform well on savings I think a lot of volume come through the system. We don't get the benefit of it just happens to be Super sticky revenue and I would also just say that validates the value proposition, but on page eight of our deck.

Madison Aron: So if we perform well on savings, I mean, a lot of volume comes through the system. We don't get the benefit of it. It just happens to be super sticky revenue. And I would also just say that validates the value proposition. But on page 8 of our deck, we talk about, we talk about the primary KPI, which is the Peace Savile. In your ratio, you're right. It has continued to decline. It was pretty stable last year after the rate change of one of our larger clients. And there's been a little bit of a down draft, but we can underneath it is a lot of factors that we can put our fingers on that we think will abate where they're just washed into the system.

Speaker Change: Talk about we talk about.

Speaker Change: The primary <unk>, which is the piece Aviall and Youre Rishi you're right. It has continued to decline and it was pretty stable last year. After the rate change of one of our larger clients and.

Unknown Executive: However, it has continued to decline. It was pretty stable last year after a rate change at one of our larger clients. There's not a fundamental flaw in our model; it's just that things are changing over the course of these last couple quarters. Okay. And then on the large payer program, you know, I was hoping that maybe you could provide us with a little bit more detail. Was this, in terms of specifically what type of product, was this an NSA-related product?

Speaker Change: And theres been a little bit of a down draft, but we can underneath of there is a lot of factors that we can put our fingers on that we think will abate or are there just washed into the system and then there is always just a little bit of volatility around the margin I believe it or not where we feel like some of the bigger the bigger changes have washed through.

Madison Aron: And then there's always just a little bit of volatility around the margin. I believe it or not, where we feel like some of the bigger, the bigger changes have washed through at this point. And so I, you know, we feel like that's going to stabilize. But it's not going to be, you know, within basis point range, every single quarter. What's going to benefit this is where the savings just start growing. Okay? So, within a couple quarters, all of a sudden, the growth in the volume offsets any of the yield declines. And so that's what we're going through right now.

Speaker Change: At this point.

Speaker Change: And so.

Speaker Change: We feel like that's going to stabilize but it's not going to be within basis points range every single quarter, what's going to benefit this is where the.

Speaker Change: The savings just start growing okay. So.

Speaker Change: Within a couple of quarters all of a sudden the growth in the volume offsets any of the yield declines and so that's what we're going through right now, it's pretty painful and we can put our fingers on some of the very very specific things, but its not theres not any theres.

Madison Aron: It's pretty painful. And, you know, we can put our fingers on some of the very, very specific things, but it's not; there's not a fundamental flaw in our model. It's just that things are changing over the course of these last couple of quarters. Okay.

Speaker Change: There is not a fundamental flaw in our model. It's just that things are changing over the course of these last couple of quarters.

Speaker Change: Okay, and then on the large payer program I was hoping that maybe you could provide us a little bit more detail was this a in terms of specifically what type of product. Because this is the NSA related product and what gives you the confidence that this may not extend to other comparable programs within that large payer or to <unk>.

Unknown Executive: And what gives you the confidence that this may not extend to other comparable programs within that large payer or to similar programs with other large customers, assuming that there's some level of competitive pressure here? And then what are you seeing in terms of your TPA relationships and any other meaningful changes with other customers? Yeah, I Rishi as a, Specifically to the big program, I think, you know, over time, we'll be a little bit clearer on this.

Madison Aron: And then on the large payer program, you know, it's hoping that maybe you can provide us a little bit more detail. Was this a, in terms of specifically what type of product was this an NSA related product? And what gives you the confidence that this may not extend to other comparable programs within that large payer or to similar programs with other large customers, assuming that there's some level of competitive pressure here. And then what are you seeing in terms of your TPA relationships and any other meaningful changes with other customers? Yeah. Rishi, as it's specifically to the big program, I think, you know, over time will be a little bit clearer on this.

Speaker Change: Similar programs with other large customers assuming that there is some level of competitive.

Speaker Change: Pressure here and then what are you seeing in terms of your tpa relationships and any other meaningful changes with other customers.

Speaker Change: Yes.

Speaker Change: <unk> is it.

Speaker Change: Specifically to the Big program I think over time will be a little bit clear on this we wanted to put the earmark out there, but I think it is not a I would not describe this as a trend.

Jerry Hogg: We wanted to put the year mark out there, but I think it's, it is not a, I would not describe this as a trend. It is; it's trying to set this a little bit more of a strategic decision. And I would just remind everybody that in the core, you know, the core of our network business. That includes NSA; it includes data. I said all this stuff. We've got an array of assets that are hard to replicate and scale. And so it's not something; it's not an easy task for someone to shift business or internalize, you know, consistently.

Unknown Executive: We wanted to put the earmark out there, but I think it's, it is not a trend. It is, as Travis said, this is a little bit more of a strategic decision. And I would just remind everybody that this is at the core of, you know, the core of our network business. Okay.

Speaker Change: Yes.

Speaker Change: As Trevor said this a little bit more of a strategic decision.

Trevor: And I would just remind everybody that in the core the core of our out of network business.

Speaker Change: That includes NSA. It include that is that all of the stuff. We've got an array of assets that are hard to replicate and scale and so it's not something it's not an easy task for someone to.

Speaker Change: Ship business or internalize.

Speaker Change: Consistently and so we called this out but I don't think it's a trend.

Jerry Hogg: And so we call this out, but I don't think it's a trend. And we've had moments over time where people have internalized things and, you know, the world is getting more and more complex, as you're aware of. And so having an independent provider that can deal with, make the investments to deal with the ever changing complex world, particularly in the NSA world. I mean, the law still hasn't settled, and they may be changing, continuing to change. It's a big leap to make those types of decisions. So we don't see it as an ongoing trend, but it's Travis pointed out, this is, you know, but for, you know, one one client that we've seen some of this, it's been pretty consistent across the board that we feel like we're in a good position.

Speaker Change: We've had moments over over time, where.

Speaker Change: People have internalized things in the world is getting more and more complex as you are aware of and so having an independent provider that can deal with make the investments to deal with the ever changing complex world, particularly in the NSA World.

Speaker Change: The law still haven't settled and they may be changing continuing to change.

Travis: It's a big leap to make those types of decisions. So we don't see it as an ongoing trend, but it's Travis pointed out this is but for one client that we have seen some of this it's been pretty consistent across the board that we feel like we're in a good position.

Madison Aron: Okay.

Speaker Change: Okay and then just lastly, you noted execution to drive our execution skills to drive growth I was hoping that you could just elaborate on what this actually means historically the growth was product and relationship driven.

Unknown Executive: And then, just lastly, you noted execution to drive or execution skills to drive growth. I was hoping that you could just elaborate on what this actually means. Historically, growth has been product and relationship driven. Is this no longer the case? Meaning that is the product deficient and not meeting customer demands? Are there better competitive offerings? Any insight would help because the view has been these acquisitions will start to turn around this year and we'll see a meaningful free cash flow turnaround in 2025. However, that does not seem to be the case.

Madison Aron: And then just lastly, you noted execution to drive or execution skills to drive growth. I was hoping that you could just elaborate on what this actually means. You know, historically, the growth was product and relationship driven. Is this no longer the case, meaning that is the product deficient and not meeting customer demands? Are there better competitive offerings? You know, any insight would help because the view has been, you know, these acquisitions will start to turn around this year. And we'll see a meaningful free cash will turn around to 25. That does not seem to be the case.

Speaker Change: This is no longer the case, meaning that is the product deficient in not meeting customer demands are there better competitive offerings any insight would help because the view has been these.

Speaker Change: Acquisitions will start to turnaround this year and we will see a meaningful free cash will turn around the 25 that does not seem to be the case or we expect you to see that turnaround more like 26, 27 and 28. This five year plan, how should we think about or at least can you at least help us quantify given all these uncertainties, where this is going.

Unknown Executive: Are we expected to see that turnaround more like 2026, 2027, 2028, this five-year plan? How should we think about, or at least can you at least help us quantify given all these uncertainties where this is going? Thank you. Yeah, this is Jerry. I'll jump in on that one first.

Jerry Hogg: Are we expected to see that turn around more like 26, 27, 28, this five year plan. How should we think about or at least can you at least help us quantify, given all these uncertainties, where this is going. Thank you. Yeah, this is Jerry. I'll help you jump in on that one first. So I think the outlook our long term strategic outlook is fundamentally from us around to two ideas, right. Stability and the fundamental favorable trends, growth trends in the core. And then better execution on taking our products to market in our all of the new products that we've spoken about today and in prior prior earnings calls.

Speaker Change: Yes.

Unknown Executive: Yeah, so I think the outlook, our long-term strategic outlook is fundamentally premised around two ideas, right? Stability and fundamental favorable trends, growth trends at the core. And then better execution on taking our products to market in all of the new products that we've spoken about today and in prior earnings calls. So the market potential for the products remains there. We think we've got a differentiated product set in every area that we've talked about. We simply haven't executed as well as we can on the marketing and sales front.

Speaker Change: This is Jerry I'll jump in on that one first so I think the outlook our long term strategic outlook is fundamentally premised around.

Steve: Two ideas right Steve.

Steve: Stability.

Jerry Hogg: And fundamental favor.

Steve: Favorable trends growth trends in the core.

Jerry Hogg: And then better execution on taking our products to market and are all of the new products that we've spoken about.

Jerry Hogg: Today in prior.

Jerry Hogg: Earnings calls so the market potential for the products remains there.

Jerry Hogg: So the market potential for the products remains there. We think we've got a differentiated product set in every area that we've talked about. We simply haven't executed as well as we can on the marketing and sales front, and that's where we're going to be focused. The create the kind of pipeline that we need to support healthy revenue growth and capture the part of each market that we think our product deserve based upon their differentiation. And we've got, you know, as a part of that plan, very specific revenue trajectories, reach one of them that we're going to, you know, the crusher test and triangulate on and support with pipeline as we go.

Jerry Hogg: We've got a differentiated product set in every area that we've talked about we simply haven't executed as well as we can on the marketing and sales front and Thats where were going to be focused.

Unknown Executive: And that's where we're going to be focused on creating the kind of pipeline that we need to support healthy revenue growth and capture the part of each market that we think our products deserve based upon their differentiation. And we've got, as a part of that plan, very specific revenue trajectories for each one of them that we're going to pressure test and triangulate on and support with pipeline as we go. But fundamentally, it's been slow getting out of the blocks and creating the pipeline. And then, in this example, in particular, converting the transaction to revenue, just given the lag and enrollment and ultimately when things started getting paid. So we'll see evidence of that.

Jerry Hogg: To create the kind of pipeline that we need to support healthy revenue growth and capture the part of each market that we think.

Jerry Hogg: Our product deserve based upon their differentiation.

Jerry Hogg: And we've got.

Jerry Hogg: As a part of that plan very specific.

Jerry Hogg: Revenue trajectories for each one of them that were going on.

Jerry Hogg: The pressure test and triangulate on and support with pipeline as we go.

Jerry Hogg: But fundamentally it's been slow getting out the blocks on creating the pipeline and then in the HST example in particular converting that the transaction to revenue just given the lag and enrollment and ultimately when things started getting paid. So what we'll see evidence of that will understand what it means in terms of transaction size. And we'll allow us to forecast that business better; at the same time, we build up the pipeline for that product and the others. Thank you.

Speaker Change: Fundamentally it's been slow getting out of the blocks on creating the pipeline and then in the HST example, in particular converting that that transaction to revenue just given the lag in enrollment and ultimately when things started getting paid so we'll see evidence of that will understand what it means in terms of transaction size.

Unknown Executive: We'll understand what it means in terms of transaction size and will allow us to forecast that business better. At the same time, we build up a pipeline for that product and others. Yeah, sorry, Jim, I'll take it.

Jerry Hogg: And will allow us to forecast that business better at the same time, we build up the pipeline for that product and the others.

Speaker Change: Thank you. Our next question today is from the line of Jessica touched on of Piper Sandler. Please go ahead. Your line is now open.

Jessica Tassan: Our next question today is from the line of Jessica Tassan or Piper Sandler. Please go ahead; your line is now open. Hi guys, thank you for taking the question, and James, it's been nice working with you, however briefly.

Speaker Change: Hi, guys. Thank you for taking the question.

Speaker Change: And it's been nice working with you however briefly.

Jessica Tassan: So first, I'm just interested to know if Douglas worked with you on the revised forecast. So Doug will be coming in. Yeah, sorry, Jim, I'll take it. So yeah, we've been working closely, primarily with Jerry and with Jim. So we've been looking at the business holistically. We've been meeting with our product teams. We've been meeting with the market teams. We've been doing, I would say, you know, triangulating on those views and coming up with something that we think is fair and reasonable based on what we know today, which is more than we knew entering the year.

Speaker Change: So firsthand I'm just interested to know with Douglas worked with you on the revised forecast.

Speaker Change: So yes, obviously, we all know so Doug would be coming in.

Unknown Executive: So, yeah, we've been working closely, primarily with Cheri and with Jim. So, we've been looking at the business holistically, we've been meeting with our product teams, we've been meeting with the market teams, and we've been, I would say, triangulating on those views and coming up with something that we think is fair and reasonable based on what we know today, which is more than we knew entering the year. I've worked with Doug previously, so I have experience with Doug, and his expertise really is in technical accounting, FP&A, and setting up a finance organization.

Jerry Hogg: Sorry, Jim I'll take it so yeah, we've been working closely.

Speaker Change: Primarily with Jerry and with Jim So we've been looking at the business Holistically, we've been meeting with our product teams. We've been meeting with the market teams. We've been doing I would say triangulating on those views in coming up with something that we think is fair and reasonable based on what we know today, which is more than we knew entering the year.

Travis Dalton: I've worked with Doug previously, so I have an experience with Doug, and his expertise really is in technical accounting, FP&A, and setting up a finance organization. So one of the big challenges I think we've had, and you all are hitting on it today, is getting more precision and predictability with our yields and our revenue forecast over time. And so that is a primary job one focused for Doug is to come in and help us continue to validate the assumptions that we've made, but also help us be more predictable in how we look at revenue and how bookings turn to revenue and over what time frame.

Doug Garris: Worked with Doug previously so have experience with Doug and his expertise really is in technical accounting F PNA and setting up a finance organization. So one of the big challenges I think we've had and you are hitting on it today is getting more precision and predictability with our yields and our revenue forecast.

Unknown Executive: So, one of the big challenges I think we've had, and you all are hitting on it today, is getting more precision and predictability with our yields and our revenue forecast over time. And so, that is a primary job one focus for Doug is to come in and help us continue to validate the assumptions that we've made, but also help us be more predictable in how we look at revenue and how bookings turn to revenue and over what time frame. So, we can avoid having this kind of call again under my tenure, anyway.

Jerry Hogg: Over time and so.

Speaker Change: That is a primary job one focus for Doug is to come in and help us continue to validate the assumptions that we've made but also help us be more predictable in how we look at revenue and how bookings turning to revenue and over what timeframe. So we can avoid having this kind of call again under my tenure anyway, and so that's what I expect from Doug.

Travis Dalton: So we can avoid having this kind of call again under my tenure, anyway. And so that's what I expect from Doug, but I'm confident that Jerry's got the process in place, working closely with Jim, and that, you know, we've done everything we possibly can in our current construct to scrub this. And frankly, we're just taking it head-on, which is why we're having this call today. And, you know, being as transparent we are with where the numbers and where we think the issues are. Yeah, and sorry, go ahead. No, no, please finish.

Unknown Executive: And so, that's what I expect from Doug, but I'm confident that Cheri's got the process in place working closely with Jim and that, you know, we've done everything we possibly can in our current construct to scrub this. And frankly, we're just taking it head on, which is why we're having this call today and, you know, being as transparent as we are with the numbers and where we think the issues are. Yeah, and on that point, Rachel.

Speaker Change: But I'm confident that <unk> got a process in place working closely with Jim.

Jerry Hogg: We've done everything we possibly can in our current construct describe this.

Jerry Hogg: And frankly, we're just taking it head on which is why we're having this call today.

Jerry Hogg: And.

Jerry Hogg: Being as transparent we are with where the numbers and where we think the issues are.

Jerry Hogg: Yes.

Jerry Hogg: On that point right. So okay.

Unknown Executive: I'm sorry. Go ahead. No, no, please.

Speaker Change: I'm sorry go ahead.

Speaker Change: No no please finish.

Unknown Executive: So, you know, it's kind of going back to the core business right there, that although there is a favorable volume trend, there is a question mark on yield, right? So our view is, as Jim said earlier, there were some one-time things in the quarter that diminished the yield on a sequential basis, but looking at that question holistically, we think the long-term trend is that the yield stabilizes and potentially reverts upwards a bit.

Travis Dalton: So, you know, it's kind of going back to the core business right there. There is a favorable volume trend. There is a question mark on the yield, right? So our view is, as Jim said earlier, there were some one-time things in the quarter that diminish the yield sequential basis. But looking at that question, realistically, we think the long-term trend is that the yield stabilizes and potentially reverts upwards of that. It is driven by a number of factors that are subject to the wind of, you know, health care consumption and the nature of the claims that we see.

Speaker Change: So so.

Speaker Change: Kind of going back to the core business right. There there is a favorable volume trend. There is a question mark on the yield right. So our view is as Jim said earlier, there were some one time things.

Jim: Things in the quarter that diminish the yields on a sequential basis.

Speaker Change: Looking at the bad debt that question Holistically, we think the long term trend is that the yield stabilizes and potentially reverts upwards a bit it is driven by a number of factors that are subject to the women health care consumption and the nature of the claims that we see but the volume trend is undeniable we reported it.

Unknown Executive: It is driven by a number of factors that are subject to the whim of, you know, healthcare consumption and the nature of the claims that we see, but the volume trend is undeniable. We reported it at the byline of our press release, 8, 9% growth.

Travis Dalton: But the volume trend is undeniable. We reported it at the, you kind of a byline of our press release eight nine percent growth. So, if we believe that the thesis or the conviction that our yield is going to stabilize, then you can imagine what that does to the core business. And then the rest of it is execution on the new products that we have in flight. Travis mentioned as well as the products that we acquired through our recent acquisitions. We just need to monetize those because there's a value there. And that's really an execution question.

Speaker Change: A byline of our press release eight 9% growth. So if we believe that the piece that thesis.

Unknown Executive: So if we believe that the thesis or the conviction that our yield is going to stabilize, then you can imagine what that does to the core business. And then the rest of it is execution on the new products that we have in flight, as Travis mentioned, as well as the products that we acquired through our recent acquisitions. We just need to monetize those because there is value there.

Speaker Change: Conviction that our yield is going to stabilize and you can imagine what that does to the core business and then the rest of it is execution on the new products that we have in flight as Travis mentioned as well as the products that we acquired through our recent acquisitions.

Travis: We just need to monetize those because there is value there and that's really an execution question and where we are on it 100%.

Jerry Hogg: And we're, we're on it 100. I just wanted to ask on the program attrition, I guess just how much notice that that customer has to provide to exit that particular product, and are there a significant number of kind of modular or program based engagement that could attrate effectively at any time? Jessica, under these agreements, there's no volume commitments, there's no minimums, or anything like that. So there's, you know, if it is not a contractual issue, we tend to get pretty good visibility on this, which is one of the reasons why we're telling you about something that's going to happen in the future.

Speaker Change: Got it.

Unknown Executive: And that's really an execution question, and we're on it 100%. Got it. I just wanted to ask about program attrition, I guess, just how much notice did that customer have to provide to exit that particular product? And are there a significant number of kind of modular or program-based engagements that could attrit, you know, effectively at any time? Yeah, Jessica, under these agreements, there's no volume commitments. There are no minimums or anything like that.

Speaker Change: Just wanted to ask on the program attrition I guess, just how much notice.

Speaker Change: To provide.

Speaker Change: Other product and are there a significant number of kind of modularity program anything Jason.

Jason: Actively at any time.

Jessica: Yes, Jessica.

Unknown Executive: So there's, you know, it is not a contractual issue. We tend to get pretty good visibility on this, which is 1 of the reasons why we're telling you about something that's going to happen in the future. And that's basically just a good relationship with the customer. But as I pointed out, again, this is very, very specific. And it's not, you know, it's not something that every client is going to choose strategically to try and do, or has the scale and capability.

Speaker Change: Under these agreements Theres no volume commitments Theres, no minimums or anything like that so there is is this is.

Speaker Change: Not a contractual issue we tend to get pretty good visibility on this which is one of the reasons why were telling you about something thats going to happen in the future.

Jerry Hogg: And that's basically just a good relationship with the customer. But, as I pointed to again, this is very, very specific, and it's not, you know, it's not something that every client, you know, is going to choose strategically to try and do, or has the scale and capability to do.

Speaker Change: And Thats basically just a good relationship with.

Speaker Change: With the customer.

Speaker Change: But as I pointed to again this is very very specific.

Speaker Change: And it's not it's not something that every client is going to choose strategically trying to or has the scale and capability to do.

Jerry Hogg: Jessica, and then my last one is just on the volume growth that's offsetting the yield decline. Is that occurring within customers, or is that occurring through a new customer acquisition? Can you just help me understand the drivers of the volume growth would be helpful? Thank you. Yeah, it's, yeah, it's, I would describe it as pretty much same-store sales, same-store volume, meaning, meaning a, you know, book of employers using utilizing healthcare more. Does that make sense, Jessica? Got it.

Speaker Change: Got it and then my last one is just on the volume growth offsetting declines.

Unknown Executive: Got it. And then my last one is just on volume growth that's offsetting the yield declines. Is that occurring within customers, or is that occurring for a new customer acquisition? Would you just help me understand the drivers of the volume growth? It would be helpful. Thank you. Yeah, it's I would describe it as pretty much same store sales, same store volume, meaning a book of employers utilizing health care more. Does that make sense, Jessica?

Speaker Change: That occurring.

Speaker Change: <unk> customers or is that occurring for new customer acquisition.

Speaker Change: Understand the drivers of the volume growth.

Speaker Change: Yes, yes, yes.

Speaker Change: Describe it as pretty much same store sales same store volume.

Speaker Change: Meaning meaning.

Speaker Change: That book of employers using utilizing healthcare more.

Speaker Change: Does that makes sense Jessica got it.

Unknown Executive: Um, yeah, I guess it's the number of times that that MultiPlan is invoked in, you know, in a year across a given population. Has that changed? And is that driving some of the volume growth you guys are both seeing and anticipating in the future? And if so, if the number of kinds of engaged interventions has increased within a particular book, why?

Jerry Hogg: Yeah, I guess it's the number of times that that multi-plan is invoked in, you know, in a year across a given population. Has that changed, and is that driving some of the volume growth you guys are both seeing and anticipating in the future? And if so, is the number of kind of engaged interventions it has increased within a particular, both why? Yeah, I think it's a little bit, in a broad base. I don't think it's, you know, a massive change in all of a sudden there's a bunch of new consumers that are using out of network services.

Jessica: Yeah, I guess is the number of times that that multi plan is invoked and.

Speaker Change: In a year our coffee given population has that changed that driving some of the volume growth. You guys are are both being in and competing in the future and if so with the number of kind of <unk>, Inc.

Speaker Change: Intervention has increased within a particular about why.

Speaker Change: Yes, I think it's a little bit.

Unknown Executive: Yeah, I think it's a little bit on a broad base. I don't think it's, you know, a massive change. And all of a sudden, there are a bunch of new consumers that are using out-of-network services. I think, I think there is, as you're seeing with hospitals, there's been a fundamental uplift on the demand side, largely because of capacity. So we're just seeing a little bit of that throughput. And then we're also seeing healthcare inflation, which is always part of the equation, in terms of overall bill charges starting to wash through. I don't think it's a major trend.

Speaker Change: Broad based I don't think it's.

Speaker Change: And a massive change and all of a sudden there is a bunch of new consumers that are using out of network services I think I think there is.

Jerry Hogg: I think, I think there is, as you're seeing with hospitals, there's been a fundamental uplift in the demand side, largely because of capacity, so we're just seeing a little bit of that throughput, and then we're also seeing healthcare inflation, which is always part of the equation in terms of overall build charges starting to wash through. I don't think it's a major trend, but over time, I think the, you know, the inflation expectations on a forward basis are starting to increase as hospitals, et cetera, are trying to renegotiate contracts and then tangentially pushing up their charge masters, which is their list price.

Speaker Change: As you are seeing with hospitals, there has been a fundamental uplift in the demand side.

Speaker Change: Largely because of the capacity. So we're just seeing a little bit of that throughput and then we're also seeing health care inflation, which was always part of the equation in terms of overall bill charges starting to wash through I don't think it is a major trend, but over time I think.

Unknown Executive: But over time, I think inflation expectations on a forward basis are starting to increase, as hospitals, etc., are trying to renegotiate contracts and then tangentially pushing up their charge masters, which is their list price. So we're seeing price and volume, just across the board going up. We see physicians are always a little bit slower, but on the facility side, it's picked up.

Speaker Change: Inflation expectations on a forward basis are starting to increase.

Speaker Change: <unk>.

Speaker Change: As hospitals et cetera, or are trying to renegotiate contracts and then tangentially pushing up their charge Masters, which is their list or list price. So we're seeing we're seeing price and volume.

Jerry Hogg: So we're seeing price and volume just across the board going up. Physicians is always a little bit slower, but on the facility side, it's picked up, and it's very similar when you see an HCA tenant, et cetera, this quarter.

Speaker Change: Just across the board going up.

Speaker Change: Physicians is always a little bit slower, but on the facility side, it's picked up and it's very similar to what you see at HCA tenet et cetera. This quarter.

Unknown Executive: Thank you.

Speaker Change: Thank you.

Speaker Change: Yeah.

Unknown Executive: And it's very similar to what you see at HCA tenants, etc., this quarter. Thank you. Thank you. And our next question is from the line of David Beard of Jeffreys. Please go ahead. Your line is now open.

David Beard: And our next question is from the line of David Beard of Jeffries.

Speaker Change: Thank you and our next question is from the line of David <unk> of Jefferies. Please go ahead. Your line is now away from the call.

David Beard: Please go ahead; your line is now open. Hey, thanks, Jim, and thanks, team, for the time. A lot of money have been answered, but I just want to put a finer point on the revenue question. You kind of hit on a little bit. I know you want to stay away from giving full blown 205 guidance, but in light of the 3% attrition headwind.

David: Hey, Thanks, Tim and thanks team from the time a lot of mine have been answered, but I just want to put a finer point on that.

Unknown Executive: Hey, thanks, Jim. And thanks, team, for your time. A lot of mine have been answered.

David: Revenue question, you kind of hit on it a little bit I know you want to stay away from giving full blown <unk> guidance Greenlight, that's 3% attrition headwind at this point do you see or foresee enough stability in the yield and an up growth on the volume to overcome that 30% attrition headwind in 2005 to get back to a positive.

Jim Head: At this point, do you see or foresee enough stability in the yield and an upgrowth on the volume to overcome that 2% attrition headwind in 2025 to get back to your economy and revenue outlook, or how should we be thinking about kind of level setting it? Yeah, it's, you know, maybe maybe to answer it is more an isolated, so the yield, I do think the yield, the yield is going to settle. I don't think that's going to be the story in 2025. The volume environment feels good. We haven't seen any signals to suggest that it's going to get worse.

Speaker Change: Our revenue outlook or how should we be thinking about kind of a level setting.

Unknown Executive: But I just want to put a finer point on the revenue question. You kind of hit on it a little bit. I know you want to stay away from getting full-blown 2025 guidance, but in light of the 3% attrition headwinds, at this point, do you see or foresee enough stability in the yield and enough growth in the volume to overcome that 3% attrition headwind in 2025 to get back to a positive revenue outlook, or how should we be thinking about kind of low Yeah, it's, you know, yeah, it's, So, I do think the yield is going to settle. But I don't think that's going to be the story in 2025. The volume environment feels good.

David: Yes.

David: Okay.

Speaker Change: Maybe maybe to answer it is more than an isolated piece. So the year I do think the yield the yield is going to settle I don't think thats going to be the story in 2025.

Unknown Executive: We haven't seen any signals to suggest that it's going to get worse. We've always been a little cautious when predicting the upswing. And so, but I would also point in the rear view mirror and say, you know, all things being equal, we've seen, you know, nice, solid growth in, you know, kind of. The bulk of our customer base, even trailing this last quarter. And so there's, you know, there's just a good, solid trend there.

David: The volume environment feels good we haven't seen any signals that suggest that it's going to get worse, we have always been a little cautious calling the upswing and so but I would also point in the rearview mirror and say all things being equal we've seen.

Jim Head: We've always been a little cautious calling the upswing. And so, but I would also point in the rearview mirror and say, you know, all things being equal. We've seen, you know, nice solid growth in, you know, kind of the bulk of our customer base, even, you know, trailing from this last quarter. And so there's, you know, there's just a good solid trend there that exists in the business. We also are planting, you know, the seeds that are getting planted on these new products. And whether it's HST or BST, BST being a big contributor will continue to help us.

David: Nice solid growth in kind of.

David: The bulk of our customer base, even trailing from this last quarter and so there is there's just a good solid trends there that exists in the business. We also are planting the seeds that are getting planted on these new products and whether it's HST or BSD BSC being a big.

Unknown Executive: That exists in the business. We also are planting, you know, the seeds that are getting planted on these new products, and whether it's or being a big contributor will continue to help us. It's been slower than we'd like. So you put some of those ingredients together, and then I think what we're trying to do is say, here's 1 more ingredient, which is a headwind. And we've always had things like this along the way that we've overcome, but that's kind of the ingredients for 2025, but we're just not going to get into it.

David: <unk> will continue to help us it's been slower than we'd like so you put some of those ingredients together.

Jim Head: It's been slower than we'd like. So you put some of those ingredients together. And then I think what we're trying to do is say, here's one more ingredient, which is a headwind. And we've always had, you know, things like this along the way that we've overcome.

David: And then I think what we're trying to do is say, here's one more ingredient which is a headwind.

David: We've always had.

David: Things like this along the way that we've overcome but that's kind of the ingredients for for 2025, but we're just not going to get into the.

Jim Head: But that's, that's kind of the ingredients for 2025, but we're just not going to get into, you know, the algorithm for that. I think it's too early. And quite frankly, I think we're just going to have a lot more visibility as we get into the back half of this year and early next year. To kind of shape that a little bit better for you. Thank you.

Unknown Executive: You know, the algorithm for that, I think it's too early, and quite frankly, I think we're just going to have a lot more visibility as we get into the back half of this year and early next year to kind of shape that a little bit better for you.

David: The algorithm for that I think it's too early and quite frankly, I think we're just going to have a lot more visibility as we get into the back half of this year and early next year to kind of.

David: Shape that a little bit better for you.

Speaker Change: Got it okay. Thank you.

Unknown Executive: Got it. Okay. Thank you. Thank you. And with no further questions in the queue at this time, this will conclude the MultiPlan Corporation second quarter 2024 earnings call. Thank you to everyone who has joined us today. You may now disconnect your line.

David: Okay.

Speaker Change: Thank you and with no further questions in the queue. At this time. This will conclude the Multibank Corporation second quarter 2024 earnings call. Thank.

Unknown Executive: And with no further questions in the queue at this time, this will conclude the Multi Bank Corporation second quarter 2024 earnings call. Thank you to everyone who has joined us today. You may now disconnect your lines.

Speaker Change: Thank you to everyone who has joined US today you may now disconnect your lines.

David: [music].