Q3 2024 TruBridge Inc Earnings Call
Provided in this call represents their outlook only as of this date and they undertake no obligation to update or revise any forward looking statements to reflect events or developments. After the date of this call.
At this time I will now turn the call over to Mr. Chris Sadler, President and Chief Executive Officer. Please go ahead Sir.
Speaker Change: Thank you drew and thank you to everyone. Joining us this morning as many of you know we're on the journey and today I am pleased to report that we've reached some of those first milestones. We've hoped to achieve we feel really good about the progress we've made so far and our trajectory as we head into the final months of the year.
Speaker Change: Before I jump in I would like to highlight that going forward. We will now refer to our RCM business, its financial health and our EHR and patient engagement business as patient care booking.
Speaker Change: Bookings in the third quarter remained strong building on the trends from the first half of the year and marking our fourth consecutive quarter with more than $20 million in total bookings our financial health revenue growth is solid on an organic basis, excluding vehicle financial health revenue grew 5% and our core <unk> business is up by double.
Speaker Change: <unk> in the quarter.
Speaker Change: Adjusted EBITDA also increased and margins continue to expand sequentially coming in at 16, 5% this quarter.
And finally, our cash flow from operations is roughly $22 million year to date, an improvement of almost $9 million compared to last year.
Speaker Change: As I reflect on what we've accomplished in the third quarter I will highlight progress on our integration of yugo momentum and interest for our intra solution and updates to our analytics offering.
Speaker Change: We've made steady progress on our integration of the vehicle acquisition and as of the end of the third of the end of the quarter, we have more than 30% of our CBO and <unk> customers now supported by our team in India.
Speaker Change: Through the end of the year, we will monitor and adjust the operations around this first wave of customers.
Speaker Change: By the end of 2025, we expect to double the number of customers that are supported by our workforce in India to 60%.
Speaker Change: In addition to accommodate the increased customer transitions, we will have more than 500 employees in India by the end of this year and nearly 700 by the end of 2025 supporting our CBO clients.
Speaker Change: While we are pleased with our progress so far this year, we remain laser focused on stabilizing the operations and expect to yield significant margin improvement in 2025.
Speaker Change: I recently visited our office in India with other members of management to meet with our newest team members.
Speaker Change: Our goals for this trip where to build excitement about being part of Trowbridge celebrate our success to date and align on what's next.
Speaker Change: India is a very competitive market for talent. So it's important that our new team members are engaged view themselves as part of a larger team and clearly see how they directly impact and contribute to our success I am proud to say that our integration efforts have helped us to maintain a lower than average employee attrition rate in India.
Speaker Change: Moving on to entrust, our integrated financial health and patient care solution, we continue to gain traction in the market and our customer count now stands at 78 clients up nearly 30% year over year and signaling our success in these efforts in the quarter. We added one net new client and close five.
Speaker Change: Contracts with patient with existing patient care clients as we look at our success in the year. So far we are selling at a faster pace in 2024 with 22 sales year to date compared to 18 for the entirety of last year.
Speaker Change: Our intra sales are not all created equal remember that the contract value is based on the volume of each facility and we are focusing our efforts on getting more customers onto this solution and we anticipate some variation in revenue as we continue to sign the new contracts.
Speaker Change: We touched on our analytics offering earlier this year when it was launched and as an update we're pleased with the uptake so far.
Speaker Change: customers data to provide insights on how they can better run their businesses.
Speaker Change: Early users have benefitted from dashboards that are making it easier for them to improve clinical outcomes with their chronic care population, and our solutions have identified bottlenecks in the revenue cycle allowing our clients to address root cause problems to reduce collection times.
Speaker Change: This has added value to the existing installed base, gives potential EHR customers another reason to buy, and enhances the experience with our RCM solutions.
Speaker Change: We launched Analytics in the second quarter and continue to invest and gain interest with our sales and our marketing efforts.
Speaker Change: Early feedback from customers has been tremendous, and we believe this opportunity will contribute to our revenue growth over the next few years.
Speaker Change: Before I turn the call over to Vinay, I'll spend a few minutes on changes to our board of directors and our management team.
Speaker Change: Last month, we announced that Denise Warren will be stepping down off of our board to pursue the role of Chairman of Brookdale Senior Living. I want to take this opportunity to publicly thank Denise and express how much we have enjoyed working alongside her for many years. We wish her the best in all her new endeavors.
Speaker Change: To fill her seat, we announce the election of Amy O'Keefe to our board. Amy brings invaluable financial and operational expertise to Truebridge. Her appointment reaffirms our commitment to building a strong, engaged board to guide us towards our next stage.
Speaker Change: From an executive leadership perspective, we are elevating the roles of our business unit general managers, making it so they will now report directly to me.
Speaker Change: When I assumed the role of CEO two years ago, we purposely evolved and expanded the scope of our two business units and feel this is a natural time to make this transition.
Speaker Change: In the beginning, we felt they could benefit from the additional support of a COO and David Dye took on the responsibility to guide and develop them.
Speaker Change: We have been planning for this transition for some time now and feel that the GMs have evolved and are ready to take this step.
Speaker Change: The role of COO will be eliminated on December 31st, but David will remain a member of our board until his term is completed next year. David has made a true impact on our company over the past 34 years and is a key factor in us getting to where we are today.
Speaker Change: In a world where everything is measured and scored, it is next to impossible to truly measure the impact David has had on our organization. I've had the pleasure to work for him and with him for most of my tenure. I will cherish his leadership, his mentorship, and his friendship that he has shown, and he will truly be missed.
Speaker Change: I'm proud of our team's continued progress this quarter. We've delivered consistent results, building on the momentum from the first half of our year.
Speaker Change: Our focus on our financial health business continues to drive growth, and we're seeing encouraging traction with our interest solution. The strength of our bookings and our pipeline gives us confidence in our outlook for the remainder of the year and beyond.
Speaker Change: As always, I want to thank our dedicated employees for their hard work and our customers for their continued trust in Truebridge. We look forward to closing out 2024 on a strong note and carrying this positive momentum into the new year. With that, I'll turn it over to Vinay.
Vinay: Thank you, Chris, and thank you all for joining our call this morning. Today, I'm going to update you on the financial initiatives we have been working on, run through the third quarter results, and close by discussing guidance for the rest of the year.
Vinay: Our third quarter financial results continue to demonstrate the strength of our underlying business and the progress we are making against our financial objectives.
Vinay: Our first priority was to improve cash flows and working capital management. We continued to make progress in this area in the third quarter. In Q3, we generated $10.1 million of cash flow from operations, an improvement of $7 million versus the prior year.
Vinay: This brings our year-to-date total to $21.8 million versus $13.3 million in the first three quarters of last year.
Vinay: Our accounts receivable balance is down 5% sequentially and DSOs continue to improve consistently and are down approximately 8 days from quarter one.
Second, we are optimizing the business and expanding profitability.
Vinay: We made meaningful progress on this front. We successfully completed the cost rationalization actions identified in Q224 with a reduction of expenses by $5 million this year, beginning in April, which equates to approximately $8 million of savings on a full year basis.
Vinay: Further, we continue to focus on expense management, including labor and vendors. This includes steps in transitioning the RCM offshore services, balancing the savings and customer satisfaction.
Vinay: As a result, our adjusted EBITDA margin has increased to 16.5% this quarter, an improvement of approximately 470 basis points compared to the prior year, and 165 basis points sequentially.
Vinay: Third, we are increasing the quality of our reported earnings. The percent of capitalized software in the quarter was 5.2%, down 190 basis points compared to prior year.
Vinay: and 63 basis points since the first quarter. Year-to-date, up to Q3, total capitalized software was $13.7 million and $4 million lower than previous year, primarily driven by sunsetting, centric and other lower return on investment projects.
Vinay: We are also focused on rationalizing our real estate footprint. In October 2024, we sold some real estate in Mobile, Alabama for $2.8 million gross with net proceeds of $2.5 million. As of the end of third quarter, we show it as assets held for sale.
Vinay: Finally, our fourth priority was to improve our forecasting and accounting processes.
Vinay: It's been a few quarters and I certainly feel we are improving as an organization with additional processes, increased accountability, and monthly reviews of results.
Vinay: Since the second quarter, we have identified two material weaknesses in our internal controls reported in our 10-Q.
Vinay: We have robust plans in action for remediating them and have added new members and external advisors to our finance team. There has been no material impact on our financial statements and we expect the controls to be effective in the next few quarters.
Vinay: Now turning to the third quarter review, we delivered solid results demonstrating our continued cost discipline as well as operational initiatives to further enhance our global capabilities and infrastructure.
Vinay: Bookings in the third quarter were $21 million, an increase of 40% versus the prior year.
Vinay: Taking a closer look at the growth, financial health bookings increased 38% driven by growth in four RCM, CBO, and vehicle, and patient care bookings increased 43% primarily driven by growth in add-on sales from our existing customer base.
Vinay: Year to date, the total bookings were $68 million, an increase of 22% versus the previous year, mainly due to the bookings growth in core RCM and patient care.
Vinay: Moving down the P&L, revenue of $83.8 million in the quarter was up just over 1% compared to last year.
Vinay: which we acquired in the fourth quarter of last year. Excluding AFC and Centric, revenue in the quarter was up 9% year over year.
Vinay: Financial health revenue, including vehicle, of $54.3 million, represented 65% of total revenue and was up approximately 17% compared to the prior year.
Vinay: Excluding Bugle, financial health organic revenue grew 5.3% primarily driven by double-digit growth in our core CBO off-link.
Vinay: Patient care revenue of $29.6 million decreased 18% compared to last year, primarily due to the contributions from AHD and Centric, which accounted for approximately $6 million net impact in the quarter.
Vinay: The efficiencies we are realizing in operations, labor, and spending discipline are all becoming apparent as we saw notable improvement in gross margin for both financial health and patient care.
Vinay: Total gross margins of 49.5% increase, 250 basis points compared to last year.
Financial health
Gross margins of 46.2% compared favorably to 41.7% last year.
Vinay: an increase of 450 basis points driven primarily by bugle and increased revenue growth. We are also starting to see positive impact on margins from the global workforce as we transition and stabilize the work offshore.
Vinay: Patient care gross margins of 55.4% was also up approximately 160 basis points year-over-year, benefiting from cost rationalization including work and additional cost actions taken in 2024.
Vinay: Total reported operating expenses of $39.5 million in the third quarter represented 47.1% of revenue compared to 53.3% a year ago.
Vinay: The decrease is due to reduction in product development, sales and marketing and GNA primarily driven by divestiture of AHD.
Vinay: 2024 cost actions, lower non-recurring expenses like severance and enhanced expense management partially offset by increased expenses from bugle.
Vinay: Adjusted EBITDA in the quarter of $13.8 million increased 42% compared to last year.
Vinay: Adjusted EBITDA margin in the third quarter of 16.5% showed a consistent improvement from 11.4% in the first quarter and 14.8% in the second quarter, driven primarily by increased revenue and financial health in both core products in Bugle and 2024 cost actions.
Vinay: Moving on to the balance sheet, we ended the quarter with $8.6 million cash.
Vinay: in cash up $0.9 million sequentially and nearly $5 million since the beginning of the year. This increase is a direct result of our intense focus on cash management and process improvements we have implemented since the start of the year.
Vinay: Total net debt at the end of the quarter was $168 million, and during the quarter we paid down another $3 million of principal on our debt, bringing the total year-to-date payments of $20 million.
Vinay: Our leverage ratio has been declining in the past nine months and is currently in the mid-3s. We reiterate our goal of getting it down to the range of 2.5 to 3 times through adjusted EBITDA and potential debt repayments.
Finally, turning to guidance.
Vinay: For the fourth quarter, we expect revenue to be between $83.5 and $85.5 million and adjusted EBITDA between $13.5 and $14.5 million.
Vinay: With this guidance, we are narrowing our full-year revenue guidance range to $335 to $337 million and adjusted EBITDA to $49 to $50 million, which is at the higher end of our previous guidance of $45 million to $50 million.
Vinay: The midpoint of the Q4 ranges implies the adjusted EBITDA margin of 16.5%, almost flat to Q3-24.
Vinay: This is driven by a slight uptick expected in our GNA expenses due to increased costs for remediation of internal control weaknesses and additional costs as we step up our efforts to collect age receivables, as demonstrated by our improvement in free cash flows.
Vinay: We believe both items are short-term in nature and anticipate these expenses return to a more normalized level by mid-2025. In conclusion, I am pleased with our third quarter results and especially the continuous improvement in the following metrics.
Bookings exceeding $20 million for the fourth consecutive quarter.
Vinay: Financial health revenue growth of 16.5% shows continuous improvement each quarter.
Vinay: Year-on-year growth in financial health, organic revenue, which excludes vehicle, was 5.3 percent and continues to improve each quarter. Adjusted EBITDA margins continue to expand over the course of the year as we anticipated, from 11.4 percent in Q1 to 16.5 percent in Q3.
Vinay: Cash flow from operations of $21.8 million year-to-date improved $8.5 million versus prior year and $20 million in total year-to-date debt repayment incremental to normal amortizations.
Vinay: We have also made notable progress as an organization implementing financial rigor. There is still more work to do, but I feel we are laying the foundation this year to deliver predictable and sustainable growth. With that, let's open the call to questions. Julian.
Speaker Change: Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue.
Speaker Change: You may press star 2 to remove yourself from the cube. For participants using speaker equipment, it may be necessary to pick up the handset before pressing the star keys. One moment while we poll for questions.
Thank you.
Speaker Change: And our first question comes from Sean Dodge, RBC Capital Markets.
Thanks and congratulations on the great results this quarter.
Speaker Change: On the bookings, you're making impressive progress in financial health on both new clients and the cross-sells.
Speaker Change: Maybe just on the net new, Chris, is there any kind of characterization you can provide around what these net new clients look like, are these these predominantly smaller hospitals, are you starting to get traction moving up into larger institutions?
Speaker Change: And then just any kind of broadly any change you're seeing in just kind of the macro demand backdrop on the revenue cycle side.
Speaker Change: Yeah, first of all, thanks, Sean. And thanks for the kind words at the top. Yeah, it's a great question. And to be honest, I was actually at a hospital earlier this week in Kansas that we recently signed and are going live with the first of the year. It's a hundred and fifty bed hospital, not running our EHR. And so we are starting to see some momentum into that, you know, hundred to four hundred bed space. And that's really, I think, where, you know.
Speaker Change: Obviously, you know, our name is well known in the critical access or in that, you know,
Speaker Change: More and more rural size, but I think our big opportunity is really seeing that traction take off in that 100 to 400 bed space.
from a macro perspective.
Speaker Change: I would say we're just continuing to see the same trends that we've seen over the past few quarters and that there is continued pressure on the labor from whether it's the talent that knows how to do the billing
Speaker Change: or just the pressure on the wages that they're having to pay.
Speaker Change: And then secondly, the continued complexity in the billing, as we continue to see a bigger move towards that Medicare Advantage, which is creating a little more complexity, a little more challenge in making sure that the dollars are coming in one on time and two as they should be. So I think that those will continue and continue to kind of push the demand that we're seeing.
Speaker Change: Okay, that's great. And then, Vinay, the progress Chris mentioned on the offshoring, if we think about how the savings...
Vinay: from that flow through. There's some duplicity initially when you make those transitions in terms of cost.
Speaker Change: You mentioned starting to see some net savings there in this most recent quarter, but just any kind of update on how we should think about When we start to see those savings flow through more meaningfully and just kind of any any quantifications you can you can provide there. Yeah
Speaker Change: So, I would say we have started seeing, I would say, a smaller net savings coming from Q3.
Speaker Change: I expect the larger ones in Q4. The reason I'm hesitant to give an absolute number right now, Sean, I hope you appreciate it.
Speaker Change: is because I want to see a more predictability and stabilization. So you are absolutely right. As we have recently moved a lot of customers to India, the double barrel is now getting tighter.
Speaker Change: We are seeing the uptick of stabilization of their revenues of cash collection. So I would say Q4 will be a little more is what I'm expecting, but I think in our guidance in next year is where I would be in a better position to give a more robust number. But I expect 2025 to be significantly better, significantly higher, at least in the high single-digit millions on a run rate is what I'm expecting by 2025. Yeah, and just to add a little extra color there, so we're obviously laser focused on making sure that the experience for our customer is not impacted in this transition. And so there is that double barrel, you know, from a staffing impact and making sure
Speaker Change: that the transition is as smooth as it can be. And with that said, every time that we do another tranche of customers that we move over, we've learned from our previous one. And so to the point of the expectations going into 2025, we think that that, it's only gonna improve, we're gonna see the stabilization of the customers that we've moved over, and also our ability to expedite that transition as we go forward.
Okay, that's a helpful call. Thanks and congrats again.
Thanks, bud.
Thank you. Our next question comes from Jeff Garrow-Stevens.
Thank you very much.
Speaker Change: Yeah, good morning and thanks for taking the questions and I think first of all congrats to David on a well-deserved retirement and really appreciate all of the insights that we've gathered from David on the industry over the years.
Speaker Change: And on my first question, maybe just to kind of follow up where you guys and Sean left off, you know, it looks like great progress on financial health gross margins with even more to come. I was hoping you could help us think about resourcing versus client transitions to the offshore model. You spoke about doubling clients on the offshore model by the end of next year, but by our math, it looks like you're planning on resources growing by only about 40%. So, could you help us think through how much you're resourcing ahead of?
further transitions versus leverage you're achieving on incremental resources. Thanks.
to help.
Speaker Change: get the customer experience better. There is an over-indexing of some of the people. Double barrel is another one that we are carrying. As things stabilize next year, so the incremental high end of higher resources that we go will level out as we go to the next 30%.
Thank you. Thank you.
Any other questions? I appreciate it. Yep.
Speaker Change: Yeah, yeah, that helps. And maybe to transition topics, I want to ask about the competitive environment.
Speaker Change: some of your peers have either announced new products that will come to market eventually or have announced general availability of some new products also saw a recent class report out focused on your market segment so I think timely to to get an update on how you're seeing the competitive environment I guess that's a little more focused on patient care but we certainly welcome your remarks on the financial health segment as well
Speaker Change: Yeah, and again, let me let me first say thank you for the nice comment to David. I tried to drag him onto the call and he said he enjoyed really being a bystander here. So I'll pass on the nice words.
that you shared, I'm sure he's listening too.
Speaker Change: resonating with our customer base and, you know, as you've seen our success over this year from a patient care standpoint on the bookings front, I think that we're I think we're on the right track there. You know, we continue to differentiate in our implementation and our support models as well and again feel confident about, you know, what the future looks like there. On the financial health side, similar to that,
Speaker Change: we think about the leveraging of that technology to really drive the service that we deliver. And so making sure that our efforts are focused on the technology supporting the work that we do so that we're able to be more efficient and provide scale to our customers too.
Thank you.
Speaker Change: Actually, maybe one follow-up on the patient care side and to tie in the prepared remarks around the success and traction with Entrust and
Speaker Change: specifically the remark that each contract is not equal, I guess maybe help us parse out whether that comment is more geared towards our modeling of converting booking to revenue, or should we be thinking about that as...
Speaker Change: and related to your go to market approach to try to capture incremental market share.
Speaker Change: I think the call out there is really more to say that, you know, because we're because we're pricing on a on a percentage of collections
Speaker Change: and that's based on the volume at the facility. You know, we have in our market, we obviously have a pretty wide range that we can offer to. So, you know, I would say our garden variety hospital may run somewhere in the, you know, 10 to $12 million of net patient revenue, but obviously there's variance to that. And so it's just a call out that, you know, while we're obviously very keen on the revenue, we're as focused on just capturing market share and bringing them into the fold. And that may be a $5 million net patient revenue hospital compared to a $15 million. And what we don't have visibility into is how they're gonna come through in the pipeline and transition. And so there.
Speaker Change: is volatility there and that's that was the reason for that call out in the preparative arms.
Speaker Change: Excellent, that helps. And last one for me, I certainly recognize that it's early but I was hoping you could discuss some headwinds and tailwinds for 2025 and maybe more specifically, why not the organic revenue growth rates that you referenced?
Speaker Change: and to the extent that they're recurring organic revenue growth rates are good run rates to think about on a go-forward basis. Thanks.
Speaker Change: That's a great question, Jeff. That's what I've been working for a couple of months, and we will give you guys a full view by obviously in our guidance thing. But this is, I can share the directional view where we are thinking we are at least directionally looking or trying to look at.
mid to high single-digit revenue growth.
and a few hundred basis points increased in EBITDA margin.
Speaker Change: with a goal to touch at least a 20% EBITDA margin in third or fourth quarter of next year.
Speaker Change: because this is built on the momentum that we want to exist. So Q4 becomes an important quarter. Obviously, some of these short-term upticks of expense will go away, but that's what we expect with the bookings momentum translating, laser focus on our internal processes, as well as the operational rigor that we have put in, and with the offshore margins and success.
Speaker Change: kicking in. That's our current line of thinking, and obviously we are refining, working through our planning cycle right now, and we'll share more in the next call.
Appreciate those insights. Thanks again for taking the questions.
Thanks, Jeff.
Thank you. Our next question comes from Stephanie Davis, Barclays.
Stephanie Davis: Hey guys, thank you for taking my question and I echo the congrats to David. Hope he's going to enjoy some time off.
I was...
Stephanie Davis: Hoping to dig in more to your revenue cycle cross sales, which is given it sounds like that's really taking off So could we hear more about insights into the process? What's getting clients excited and over the finish line since I know sometimes those are more emotional deals to close given how you have to go and change your staff
Stephanie Davis: and maybe how you're orienting the sales team to properly get your arms around this opportunity.
Speaker Change: Yeah, thanks for the kind words for David. And, you know, I know.
Speaker Change: Time off, but remember, we're going to keep him pretty busy on the board as well, so don't get too excited for him.
Speaker Change: but going to the go into the cross sell yeah we continue to see the momentum and I think first it speaks to
Speaker Change: the belief in our customers, in our continued focus and delivery on the patient care side, on the EHR part of the business.
Speaker Change: for them to want to look to us as the solution on the RCM side.
Speaker Change: I do think that we have also done a good job of bringing in additional partnerships.
Speaker Change: I'll reference I2I as we think about delivering solutions for our customers around value-based care so that they can take advantage of those programs that are out there.
Speaker Change: But again, for what we see, it's about just the day-in, day-out delivery of that RCM process, the cash collections that need to come in on a consistent basis day after day.
Speaker Change: And, you know, as we've talked about, the stress that's placed on our facilities, both from a labor constraint and also the continued complexities of the billing, knowing that there is somebody like TruBridge that's, you know, singularly focused on this end of the market, that's been doing this for 20 plus years and has shown consistent delivery and results over that period, is a confidence for our customers.
Speaker Change: And again, I do think it helps that it is a.
Speaker Change: connection to the EHR, that not only are they getting a highly qualified staff on the collection side, but that partnership with the EHR and the technology gives another level of transparency that they may not be able to find in other solutions that are out there.
Speaker Change: And how does the kind of impact your end market impact some of their buying decisions just given you're going to have the election probably changes the insured mix at your hospital clients there's a bit of an M&A friendlier environment and also let's throw in we've had some weird weather too right there could also cause a little bit more disruption considering your client base.
Speaker Change: I didn't hear the last part. What was that, Stephanie? The weather and IV shortages. All the disruptions that you could be seeing if you're a critical access hospital.
Speaker Change: Yeah, you know, I will say this. I mean, you know, we obviously keep an ear to the ground of what's going on in Washington and, you know,
Speaker Change: I don't want to get too far on a limb here, but our customers have been insulated for the most part, and I don't foresee a lot of impact to them negatively.
Speaker Change: based on the election. You know, there may be a little bit of, you know, additional emphasis that is applied to the Medicare Advantage plan, so that change to more of that commercial process and the value-based care model. I honestly think that that gives us even more of an opportunity than the traditional fee-for-service model that we're in today. Again, you know, when you're looking at the facilities that we're doing this for, you know, they're constrained from a resource standpoint and are focused on the task at hand day-to-day, sometimes don't have the opportunity to lift their heads up and kind of see the bigger field and what's coming around the corner. And I think that's where we can really step in and make sure.
Speaker Change: to make sure that, based on our size, our scale, that we're able to deliver that for them. So, I think the changes that are coming or that will continue to come, I think will only benefit our ability to be able to capture the market from an RCM standpoint.
Speaker Change: I'm glad you can give him a helping hand. Last one out of me, I can't let Vinay feel left out. Are there any other rationalization opportunities next year? I mean you're moving a lot of your client service offshore. Is this a near-term cost opportunity? Are you planning on maintaining more of this hybrid model as you go forward?
Thank you.
Speaker Change: I think it will be, there will be a majority of our customers will move to offshore, but it will be a, we will have a mix of domestic as well as offshore, if that was your question. But increasingly, I think our focus will be to moving the customers more to offshore resources.
Speaker Change: And now on the cost rationalization, I would say I would always in my seat, I would be wrong to say I always feel there will be more opportunities.
Speaker Change: But I want to be realistic. I want to cross the second hurdle.
Speaker Change: get it under the bag, get the process and the DNA in the company, go to the next level after that. But I would say we continuously evaluate other areas where things would be, but I just want to make sure we make this a global success for us.
Speaker Change: Yeah, and just to add on to that, I mean, it is a journey. I mean, but at the, we have to remind ourselves that
Speaker Change: you know, we want to continue to grow the business and we want to deliver to our customers. And so we've got to be mindful against short-term gains for the long-term success. And so to Vinay's point, I think what we've laid out this year and what we've accomplished shows the new discipline in the organization to continue to look for those incremental adjustments and improvements and that we're not done. We're going to continue to turn over the rocks and make sure that you know, we're operating as efficiently as we can.
Speaker Change: with a mindset on that client delight at the very top of the house.
Super helpful. Thank you guys.
Thank you, Stephanie.
Speaker Change: Thank you. And our last question comes from George Hill, Deutsche Bank.
Thank you.
Speaker Change: Hi, good morning. It's Maxine for George. Thanks for taking the question.
Speaker Change: So we are hearing a lot about increases in claim denials from MCOs. Are you guys seeing similar trends and is it impacting RCM business at all and how can TrueBridge help clients with that denial and appeal process? Thank you.
Yeah, thank you very much.
Speaker Change: Yeah, I mean, it's something that we've always seen, and again, as we see that proliferation of the Medicare Advantage plans and that continue to grow, obviously, that challenge is only going to increase, and as I said earlier, I think that provides an opportunity for us to be able to help our customers even more.
Speaker Change: I think what differentiates us again is the fact that we manage and run and invest in our own technology and use that for our customers. And so as we identify process opportunity to have that root cause impact on where those denials are starting and being able to implement new technology to be able to stop the problem where it starts.
Speaker Change: so that when the claims are submitted that we have a higher rate of acceptance and payment. And so we'll continue to drive that for our customers.
Speaker Change: Thanks, that's very helpful. And just a quick follow-up on Stephanie's question.
Speaker Change: Could you give us an update on how much of your EHR customer base is currently also using our RCM solutions? Just want to assess how much white space is left for cross-sales. Thank you.
Speaker Change: Yeah, so we currently have 78 customers that are running our InTrust solution where that's the combination of both the EHR and the RCM services.
Got it.
Thank you.
Speaker Change: Okay, looks like there are no further questions at this time. I would like to turn the floor back to Chris Fowler for closing remarks.
Chris Fowler: Thanks, Julie. And thanks everybody for waking up with us this morning. We appreciate your interest in True Bridge and hope everybody has a wonderful weekend. Thank you all.
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