Convey Health Solutions Holdings, Inc.
Q3 2021 Earnings Call Transcript

Published: 12 Nov 2021

[Operator:]

Good afternoon and welcome to the Convey Health Solutions Third Quarter 2021 Earnings Conference Call and Webcast. All participants will be in a listen-only mode throughout the duration of today's presentation. After today's presentation, there will be an opportunity to ask questions. . Please note, this event is being recorded. Leading the call today is Stephen Farrell, Chief Executive Officer; and Tim Fairbanks, Chief Financial Officer. Before we begin, we would like to remind you that certain statements made during this call, including during the Q&A, will be forward-looking statements pursuant to safe harbor provisions of the Private Securities Litigation Reform Act. These forward-looking statements are subject to known and unknown risks and uncertainties and reflect our current expectations based on our beliefs, assumptions and information currently available to us. We caution you that forward-looking statements are not guarantees of future performance or outcomes. And the actual performance and outcomes may differ materially from those made in or suggested by such forward-looking statements. Factors that could cause actual results to differ materially from those reflected in forward-looking statements include those in Risk Factors section of the company's Form 10-Q for the period ended June 30, 2021 and its other filings with the Securities and Exchange Commission. Except as required by law, we undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. Additional information will also be set forth in Convey Health Solutions quarterly report Form 10-Q for the period ended September 30 2021, which is expected to be filed later today. In addition, please note that the company won't be discussing certain non-GAAP financial measures that it believes are important in understanding and assessing its financial performance. Details on the relationship between these non-GAAP measures to the most comparable GAAP measures and reconciliation of historical non-GAAP financial measures can be found in the press release that is posted on the company's website. With that, I'd like to turn the call over to Convey Health Solutions CEO, Stephen Farrell. Please go ahead.

[Stephen Farrell:]

Thank you, operator. I'd like to thank you all for joining us for our third quarter 2021 earnings call. I'm joined today by Tim Fairbanks, our Chief Financial Officer; and John Steele, our Executive Vice President of Technology. Today, I'm going to provide some high level thoughts on our quarterly performance, and then I'll provide an update on what's new since our last call. I'll also provide an update on our operations and other development activity before I turn the call over to Tim, who will provide more details on our third quarter financial results and updated guidance. Finally, we'll open the call to questions. We achieved outstanding third quarter operating and financial results and now have two solid quarters under our belt as a public company. Let me start with the financial highlights which were excellent. Net revenue for the quarter of $82.4 million up 19% compared to last year. Adjusted earnings before interest, taxes, depreciation and amortization, adjusted EBITDA of $18.3 million up 21% compared to last year. And we now expect for the full year to achieve net revenue of $335 million to $340 million and adjusted EBITDA of $67 million to $69 million. As a reminder, we are a specialized healthcare technology and services company that helps health plans increase their revenue and reduce expenses. We improve health center operations through our technology that streamlines complex processes and improved member engagement. We help members to access their benefits and help health plans administer benefits to those members. Our clients now include 9 of the top 10 health insurance plans. And while we are critical to the core operations of our clients, we believe we are just scratching the surface of the amount of work we could be doing with each client. We operate our business in two segments, Technology Enabled Solutions and Advisory Services. Our Technology Enabled Solutions segment is currently almost 85% of our consolidated revenue. We're actively engaged in M&A that will either strengthen an existing technology or expand our technology offerings in the health plan space. Despite our outstanding performance, including our third quarter growing 19% on the top-line over the last year, and the adjusted EBITDA line growing 21% over last year, our stock performance continues to be disappointing. I think the combination of being a small business, having a small float and being a very complicated business has been challenging for the investment community to understand. Of course, I make no apology for the complexity of our business. The complexity of our business is why large sophisticated health plans use our technology, because it is difficult and complicated to do what we do. So, how do we work our way out of this small and complicated dilemma? We intend to fix this dilemma by consistently increasing revenue and earnings through a combination of organic growth and strategic acquisitions. I believe that the track record that we are establishing by increasing revenue and earnings will eventually convince investors, even those who don't really understand the complexity of our business, that they should be owners of Convey stock. We are seeing success in our Advisory business, as health plans have really opened up since COVID-19 has recently started to become less of a threat. And our technology team is busy onboarding new members during the Medicare Annual Election period that extends until December 7th. As you may recall, most of the expenses for the onboarding of new members and new plans take place during the fourth quarter, and almost all of the benefits for us come in the following year or years. As I mentioned and Tim will discuss in detail, we performed very well from a financial perspective in Q3. We also performed well from an operating perspective during the quarter, as we made several moves to strengthen the value proposition of our Supplemental Benefits business. First, we believe that, our retail partnership with a leading fintech company has dramatically strengthened our value proposition for health plans. We can now provide what we believe is the best-in-class OTC solution, because we’re able to offer a health plan, the option of allowing members to access their supplemental benefits through the retail setting, using a single cash card through the home delivery channel or through a combination of the two, which is sometimes a good solution to maintain quality for the plan, the inflexibility for the member. It's important to remember that the utilization, that is the percentage of the total benefit that is actually used by members, is only 35% or so. That means there's plenty of upside in both the home delivery and the retail channel. Of course, we continue to believe that the home delivery channel is the superior channel from a quality and member engagement perspective. And we think over time, that health plans will better understand the value of the home delivery channel. In the meantime, we now have what we believe is the best combined solution for the Medicare Advantage market. We are seeing early dividends from that fintech partnership and expect even greater returns as we begin the 2023 selling season in the next few months. We've also strengthened the value proposition of our Supplemental Benefits business by leveraging the data analytics capabilities of our value-based payment assurance team. Utilizing our 28 million member big dataset allows us to provide health plans with intelligence that can be transformed into actionable steps that improve clinical outcomes through our OTC Supplemental Benefits business. For example, we analyze medical claims data and usage of our over-the-counter benefit for over 250,000 members over a three-year period of time to better understand the connection between usage of the OTC program and the clinical outcomes of these members. We found the correlation to be very strong, as users of our OTC Supplemental Benefit program who had diabetes had an 8% lower medical cost trend over the three-year period than non-users. We also found that users of our OTC Supplemental Benefit program who had cardiovascular disease had a 7% lower medical cost trend than non-users. And, we found that users of our OTC Supplemental Benefit program, who had a history of slip and falls had a 6% lower medical cost trend than non-users. In addition, we determined that users of our OTC Supplemental Benefit program who had serious burns, had a 15% reduction in subsequent ER business compared to non-users. Although, the correlation between usage of our OTC program and reduced costs is very clear. The cause and effect is a bit harder to determine. However, it stands to reason that there is some meaningful cause and effect as our engagement with members naturally makes them more proactive with their health, which in turn improves outcomes. If we are able to provide topical antibiotics and bandages for the person with diabetes or with a burn, we believe they are less likely to have complications and readmissions. We believe, if we’re able to provide canes, walkers, handrails, and other safety devices for a person who has a history of slip and fall, they are less likely to have a subsequent slip and fall episode. So, the short story here is that we think there is strong empirical evidence of the effectiveness of our OTC program to improve outcomes for members who utilize their benefits. We believe that this strengthens our value proposition for this program, as it continues to evolve from a program that was simply designed to attract new members to a program that's designed also to retain members and improve outcomes. Why is this gradual shift by the health plans from solely attracting new members to also retaining members and improving outcomes important to our business? With a plan that is solely focused on attracting new members, they would like to advertise a very high benefit, and then hope that members do not use that benefit. As a reminder, only about 35% of the dollars available are currently being utilized. So we have meaningful upside in utilization and consequently in our business growth. And unused benefit has no retentive or clinical value. So we expect plans to begin to embrace higher utilization and unused benefits can’t yield the improved outcomes that we think our 250,000 member study demonstrated. We believe that the combination of our Value-Based Analytics and Supplemental Benefit management programs will help us to drive significant improvements in star ratings, quality of care and health outcomes. Moving to other topics, like many companies in the United States, we are experiencing some labor cost pressure and supply chain challenges. We are confident that we will be able to manage the supply chain challenges and we expect to be able to effectively manage our labor challenges by leveraging our global footprint including resources in the Philippines and in Puerto Rico. So we have a bit of headwind due to labor challenges, but we think it's manageable. Our team continues to execute and operate at a high level and our customer relationships remain strong. We've driven excellent financial results year-to-date, which is reflected in our updated guidance, and I remain confident in our growth prospects for the next several years. While we are relatively new to the public markets, we have a long operating history with proven results. We understand our business model is a little complicated and difficult to understand since we don't have a pure cost. That being said, we continue to believe our stock is undervalued and we intend to continue to deliver top line and adjusted EBITDA growth as well as cash flow. Some of you may have seen last week that we changed our name from Convey Holding Parent to Convey Health Solutions Holding, Inc. It isn't a big deal, but we thought it could help eliminate some investor confusion by including the full name used in our go-to-market materials. In closing, I'd like to thank our team for their hard work and dedication. They have done a great job executing to build a terrific business. And I believe we are well positioned for the future. Now I'd like to turn the call over to Tim, who will review our third quarter 2021 financial results and provide an update to our full year outlook. Tim?

[Tim Fairbanks:]

Thank you, Steve and thanks everyone for joining the call today. I'll review our third quarter and year-to-date financial performance and update our 2021 guidance. We generated strong third quarter 2021 financial results with net revenues of $82.4 million a 19% increase from $69.5 million in the third quarter of 2020. Technology Enabled Solutions segment revenue was $69.2 million for the third quarter of 2021, an increase of 15% from $60.1 million, during the prior year's quarter. The increase in revenue was primarily driven by 22% growth in data analytics revenue, as well as 18% growth in product revenue and 13% growth in health plan management. Advisory Services segment revenue was approximately $13.2 million during the third quarter of 2021, an increase of 39% from $9.5 million from the third quarter of 2020. We remain encouraged by the strong growth in Advisory Services, as many of our clients continue to re-engage post-COVID-19 lockdown last year. During the third quarter, we generated positive net income of $3.7 million, compared to a net loss of approximately $1.6 million for the third quarter of 2020, a $5.3 million improvement, mainly driven by revenue growth, improved operating margins, lower interest rate costs and lower COVID-19 related costs. Adjusted EBITDA was $18.3 million for the third quarter of 2021, a 21% increase from $15 million in the third quarter of 2020. Third quarter 2021 adjusted EBITDA margin improved 53 basis points to just over 22%. Interest expense was $3.3 million as compared to $4.6 million for the third quarter of 2020. This decrease reflects lower term loan balances, following the Q2 paydown using IPO proceeds. In addition, in July, we amended our credit agreements to reduce our effective interest rate approximately 75 basis points. Income tax expense was $1.1 million for the quarter versus a tax benefit of $0.5 million in the third quarter of last year. Moving to our year-to-date results. Consolidated revenue was $240.3 million, representing a 23% increase over the first nine months of 2020. For the nine months ended September 30, 2021 we reported a net loss of $10.4 million. However, $18 million of that loss was driven by IPO related items. These costs included $7.9 million for prior acts D&O insurance premium, $5 million expense related to the June, 2021 extinguishment of debt, $2.8 million of public company readiness costs and $2.3 million related to the one-time termination of the management services agreement with TPG. September year-to-date adjusted EBITDA was $49.3 million, an increase a 53% versus the first nine months of 2020. This increase was driven by a recurring revenue model, high customer retention and better-than-expected operating leverage. Moving to equity balance sheet and cash flow items. Total shares outstanding was 73,194,171 at quarter end. As of September 30, 2021 cash and cash equivalents totaled approximately $36.4 million, and we had $39.5 million available on a revolver. Total debt excluding unamortized cost of $3.1 million was $192.6 million, while net debt was $156.2 million. Net cash provided by operating activities during the third quarter 2021 was approximately $15.3 million versus an $8.4 million use of cash during the second quarter of 2021, which was impacted by $13 million of one-time costs related to the D&O policy, public readiness cost, termination of the TPG management services agreement as well as $10.3 million for the final contingent payment related to the TPG acquisition. On a year-to-date basis, our net cash used in operating activities was $4.8 million. Adjusting for a one-time item listed above, adjusted net cash provided by operating activities was $18.5 million. Capital expenditures and capitalization of software development cost was $0.9 million and $1.7 million during the third quarter respectively. To summarize these balance sheet and cash flow items, we believe our cash balances, credit availability, positive cash flow, and modest levels of debt position us well for both new product development and strategic M&A initiatives. Additionally, Q3 was our first quarter without incurring one-time costs related to our IPO. And we were able to combine 19% year-over-year revenue growth with $18.3 million of adjusted EBITDA, $16.3 million of net cash provided by operating activities, and $3.7 million of net income. As we look forward to our full year 2021 operating results, we recognize our fourth quarter results will be impacted by the expected client implementation expenses we discussed on last quarter's call. However, despite these additional costs, we are increasing the midpoints of our 2021 annual guidance, and now expect net revenues to be between $335 million and $340 million, and adjusted EBITDA to be between $67 million and $69 million. At the midpoint of these ranges, this should represent a 19% increase in revenue and a 32% increase in adjusted EBITDA over full year 2020. In closing, we delivered another strong quarter and have continued to execute upon our business plan since our June IPO. We'll be finalizing our 2022 selling season over the next 60 days and are currently managing the annual election periods for certain clients, which will help identify trends in volumes that will allow us to provide financial guidance for 2022. I'd like to thank all of our employees for their hard work and dedication, which helped us deliver these strong results. Operator, we are now ready to open the call to questions.

[Operator:]

. Our first question today comes from Michael Cherny at Bank of America.

[Michael Cherny:]

I want to dive a little bit more into the Supplemental Benefit side and being the 35% of the total. I know that this is not something that is necessarily new in terms of usage. But as you think about the different settings to push forward in Supplemental Benefits and that dynamic between the retail versus the home delivery side, what are the true gating factors that you think are -- what could potentially break the dam if you can convince otherwise to get those numbers meaningfully higher, especially given the value proposition versus the clearly direct lack of cost for the MA members that you're working with?

[Stephen Farrell:]

Sure. In terms of breaking the dam to move to home delivery versus retail?

[Michael Cherny:]

In terms of breaking the dam to get that 35% number higher.

[Stephen Farrell:]

Got it. Okay. So, let me talk a bit about how we think about retail versus the home delivery. And then I'll go into your specific question. So, during the course of this year, we've had significantly more wins and losses for next year. However, our lack of a solid retail solution has cost us some business next year. Again, win significantly outweigh our losses and we're still working through that. But the fact that we have an outstanding retail solution is going to grow the whole pie. And so there are plans that want a combination of a retail and a solution. And so we think we've expanded the market in a very meaningful way for 2023 for us, by partnering with what we believe is the best retail solution. And we now think that we got the best solution that's available in the market as a combination of retail and home delivery. In terms of breaking the dam, moving utilization up, is really above moving from attract the the mindset that health plans have, which is what attract members using a high advertised benefit amount, $100 a quarter, something like that. And let's hope they never use it. So they don't have this subsequent outreach. It's just, we brought the members in, and now we don't really want the benefit to be utilized. That's the historical model. Things like this 250,000 member three-year longitudinal study that shows that members with diabetes have 8% lower medical costs trends, cardiovascular disease 7% lower, slip and fall 6% lower medical costs trends and serious burns 15% reduction in ER visits, we're now hitting all of our clients and the market hard with this study because we believe that it demonstrates in a very meaningful way that these OTC solutions are a good answers for members. CMS has recently changed -- a couple of years ago, changed the program so that we can now tailor a program for a member with diabetes or a member with cardiovascular disease, or someone with congestive heart failure. And so we're going to be tailoring our programs more specifically to make sure that people who have diabetes are getting OTC products that are specifically tailored towards them. So it's going to be a process that we believe that this clinical data that we've developed, where we've directly linked medical claims to our members is compelling. The other thing we've talked about this in previous calls, but members or health plans that had this benefit grew 14% last year versus plans that did not offer the OTC benefit only grew 4%. So there was a very strong retentive value. And, again, this is all work that we've done in conjunction with our Pareto Intelligence Group, and we've got this growth data, which we're now hitting the plans hard with and this medical claims improvement which we're going to market with.

[Michael Cherny:]

And then I know that you're not giving guidance yet. I'm not trying to necessarily get an actual guidance number. But as you think about headwinds and tailwinds into next year, you obviously highlighted the performance you had relative to Supplemental Benefits and in more wins and losses just now, how do you think about some of the other qualitative moving pieces to think about in terms of at least sitting here on November 10th where you can see as positive versus potentially negative contributors? I assume some that labor inflation will probably be in the latter, but just curious how you think about some of the dynamics?

[Stephen Farrell:]

Sure. So, yes, I mean we got a little bit of headwind on the labor and supply chain but we feel like we've got that handled. We think next year is coming together nicely, though we're early. We're in the middle of AAP now. We're finalizing contracts. We're trying to determine the number of enrollees that our large clients are going to have, because that drives our revenue. And frankly, it'd be very helpful, through the confidence that we have in our guidance that we'll be giving, to see early January behavior patterns of members, because sometimes different -- the way different plans come together, the behavior is different and that obviously drives our revenue. We work very hard to hit our numbers. We hit them in the first two quarters and we want to be sure that we continue to do so. So, what I think that means is, we feel good about next year. But we're probably from a practical perspective not going to be able to give you a real precise answer that we have a high degree of confidence in until early Q1.

[Operator:]

Next question today comes from George Tong of Goldman Sachs. Your line is open. Please go ahead.

[George Tong:]

Hi. Thanks. Good afternoon. So 3Q was the big quarter, the big selling season to build the TES book. Can you dive a little bit about -- or dive into your progress with building that pipeline for next year and how you think December will also determine membership figures, as you continue to move through the next several months?

[Stephen Farrell:]

Sure. So, in terms of the pipeline for next year, it really depends on, which of our products you're talking about. So, in Advisory we've got -- which is 15% of our revenue, we've got a pretty short cycle and that's pretty quick. For the Advanced Plan Administration business, that is a longer cycle, but we feel very good about the pipeline there. But that in some cases can be as long as a multiple year process. For our Supplemental Benefits business, we've got a selling season that looks like it's going to start a little earlier this year for 2023. And that'll start probably in late December, January timeframe, and could go as late as kind of October, November. We are wrapping up trying to finalize things for next year, right now. And then in the Value-Based business, again, very good pipeline, that tends to be a little bit shorter process. In terms of your December question, we will have a very good idea by the middle of December, what the enrollment numbers are going to be for our health plans, which drives significant amounts of our revenue. But it's not really until January that we see the behavior, both on the cost side and on the revenue side for our Supplemental Benefits business. Tim, anything to add to that?

[Tim Fairbanks:]

Yes. I think, as Steve mentioned, that membership, that will kind of conclude mid-December, really drives our Advanced Plan business or 25% of our -- roughly 25% of our consolidated revenue. So, obviously big streams there and moving on our big clients obviously to have a very busy .

[Stephen Farrell:]

Yes. Then it obviously also impacts the Supplemental Benefits business, because larger membership yields higher usage of those products.

[George Tong:]

Historically, the Advisory segment has served as a tip of the spear, if you will, for additional cross-selling TES solutions. So, given the recovery in Advisory, what's your outlook for cross-selling activity? Have you started to see traction? And do you have evidence or anecdotal evidence of effective cross-selling between the lines of businesses?

[Stephen Farrell:]

Yes. So, we've really been in this Advisory business for, I guess, what about three years, Tim. And it's been a gradual process, but I would say that every quarter, we're operating more and more as a single integrated unit. So on the first kind of year or 18 months, that Advisory business was much more standalone than it is now. Now we have regular calls where we're looking at market opportunities and that Advisory team is really helping to drive relationships and new opportunities within the plans.

[Operator:]

Our next question today comes from Anne Samuel of J.P. Morgan.

[Anne Samuel:]

Maybe first, you spoke in the prepared comments about being actively engaged in M&A. I was wondering if maybe you could speak about some adjacencies here that might round up portfolio or what you're looking at?

[Stephen Farrell:]

Yes. Good question. So we're really focused on companies that will either improve our existing offerings, or will provide new technologies or services that our clients need, especially in Medicare Advantage. More specifically going down a level, I could see us doing more in population health management, social determinants of health CMS. It looks like for the first time is contemplating standardized measurements for social determinants of health. And so that's an area that is of interest. And as you probably know, a majority of health outcomes are determined by social determinants of health like nutritious food, transportation, income levels, social support, pollution, things like that. Member acquisition, lead generation, a couple of areas that we think are interesting. Those values type tuck-in, we're not likely to chase value in that area. Supply chain, efficiency, clinical management, utilization management, network management, risk adjustment, really anything that will either improve our current offerings or add technology offerings, current portfolio.

[Anne Samuel:]

That's a really robust list. Look forward to seeing what you add. Maybe just one on the model. The fourth quarter guide, it looks like its midpoint implies a little bit of EBITDA margin contraction. I was hoping maybe you could provide some color on the factors there? Is that labor pressure? Is that tough compares or is that just kind of spending ahead of your new enrollees coming in on January 1?

[Stephen Farrell:]

Sure. I'll ask Tim to answer that.

[Tim Fairbanks:]

Ann, it’s a very discrete item that we've talked about before. So, we've mentioned before, we had a significant upsell in our Advanced Plan business with an existing client where we're essentially combining two national plans into a single plan for a long-term Advanced Plan engagement. However, we had a significant amount of implementation cost associated with that. The members and the revenue contribution go live on January 1 of '22 but here in the second half of the year, we're spending some money to get those members and those plans consolidated into one. Those costs have shifted primarily towards the out of the third quarter towards our fourth quarter, may be a good quantum, it's a rough number, but approximately $3 million of kind of cost, that will incur in the fourth quarter that should be nonrecurring starting in '22, that'll contract the margin a bit, as well as it's simply just our EBITDA number. But I think if we sat around and looked at a long-term model and return on that investment over the six-year term of the agreement, I think we would be all very pleased.

[Anne Samuel:]

Great. So fair to think that the leverage will come early 2022 then?

[Tim Fairbanks:]

Absolutely, yes. The revenue contribution from that will begin January 1 of 2020.

[Operator:]

Our next question today comes from Steven Valiquette of Barclays.

[Steven Valiquette:]

I guess without going into specifics, your two largest customers gave some updates on their Medicare Advantage geographic expansion plans for '22 which looks fairly encouraging from our perspective. And further CMS has recently projected 9.7% overall Medicare Advantage membership growth for '22. And finally, the other notable data point, we saw some commentary that the deviation in the level of benefits within MA is beginning to hold a bit tighter on some of your major customers. So I just want to get your own perspective on these collective data points going into '22 for just Medicare Advantage, and how this may primarily set the stage for growth for Convey next year?

[Stephen Farrell:]

Sure, I'll ask John at the end here, if he has any anything to add to it. But we are very fortunate to be in a market that's growing at the pace that our market is growing. So expected growth next year is higher even than our historical growth. And as you pointed out, in our Supplemental Benefits business, and our Advanced Plan Administration business, which those two combined for about 75% of our business, they are directly tied to success of our plans. And so we think the trends are very good for us, not just in the last year or in the next year but long-term. John Steele, do you have anything on add to that?

[John Steele:]

No, you hit it right on the head, Steve. I think some of the other comments you’d had in there on some of the blended data points. We are seeing and continue to see innovation in the MA space. And so being able to be partner with those winners. They're able to kind of be able to spend more on some of those more innovative ideas. And so I think that's going to continue to be a nice tailwind for us and as they continue to differentiate in this sort of growing market, and we'll continue to see that in '22 and beyond.

[Operator:]

Our next question comes from Richard Close of Canaccord Genuity.

[Richard Close:]

I know in your comments you said that COVID, we're getting beyond COVID. But when you look at some of these MA primary care providers, obviously medical costs, expense is running pretty high, considerably high in some cases. And I'm curious either in your Advisory or as you're going out selling, in your discussions with the plans, are they bringing this up with you guys at all and is this potential positive for Convey? Or, should we think of it as a possible negative, any thoughts in and around that would be helpful?

[Stephen Farrell:]

Sure. So, when I said that, we were kind of moving past COVID or something to that effect, I didn't suggest that it wasn't still a factor. I just suggested that health -- the point was health plans are willing to meet with us, and that's important -- and meet in-person, because our technology is complicated. It's not easily understood. And despite the fact that, Zoom works reasonably well, actually getting in a room with a prospect is a better solution. In terms of our go forward, there are some programs that we are talking to health plans about potentially implementing next year around outreach to employer groups or to members that will help with testing. But we are really in the early phases of that, and whether that produces additional incremental earnings or not is hard to know now.

[Richard Close:]

Yes. I guess I'm just curious in terms of, obviously there was a lot of deferred health -- deferred medical visits in 2020. And so, from a risk coding perspective, I mean, a lot of the documentation isn't there, maybe the sheer, and so there is some headwinds with respect to the MA plans to a certain extent. And you guys are going sit between the health plans and the members and engage there. I'm just curious whether that's driving heightening demand, the critical role that you guys play is sort of driving heightened demand from the plans that they need to step up engagement with their members. And are you seeing anything along those lines?

[Stephen Farrell:]

We saw a little bit, but I would say nothing too extreme and our numbers really get locked in. So, the headwinds that the MA plans are experiencing, our benefits are all locked, filed through CMS. And so, those headwinds don't really affect us on a day-to-day basis. John, Steele, do you have anything you want to add to that?

[John Steele:]

Yes. I mean, I think it’s -- the impact for us is probably fairly neutral. I think what we are seeing is, there is a lot more emphasis that's being put around the engagement of members, which obviously plays to our ability to engage them because they are coming to us on a pretty frequent basis. As people are starting to look like, for example, on star ratings, there was a lot of a pass that was given this last year. So a lot of people had elevated star ratings. I think kind of looking at that going forward, there's -- we're seeing more emphasis on how can we impact star ratings going forward through the member experience and the member journey. So I think, we are now starting to see that come to be more -- how can we maximize each member interaction? And that what I would say is a very positive discussion that we're having with our plans that we believe will be a good long-term tailwind for us.

[Richard Close:]

If I could ask one additional question, maybe on the Supplemental side, you guys talked about the hub, and I'm just curious if there's any updates on that in terms of how you're thinking about maybe introducing that?

[Stephen Farrell:]

Yes. John, do you want to take that?

[John Steele:]

Yes, for sure. Yes, so, I mean, we're -- right now out talking to plans on the hub and as far as bringing all of the more cohesive member experience through all the different supplemental benefits to help navigate through, I think those are again, early discussions but really that's something that we're looking after -- really come to life in that 2023 benefit period as we kind of work through with them on this coming selling season, but the initial discussions around bringing -- again, it kind of goes to that having a more common number experience and being able to access those benefits that as Steve had mentioned are important for not only a retentive basis, but now that we're also adding into that dialogue, how we're going to actually impact medical cost trends that actually also kind of helps accelerate sort of the utilization of some of those benefits because there's actually a cost savings on the other side that they can start to factor into their upcoming bids, which is kind of an important aspect to their each year's competitiveness.

[Operator:]

We have reached the end of today's Q&A session and today’s call. On behalf of Convey’s team, I'd like to thank you for your attendance. And wish you a very pleasant rest of your day. And you may now disconnect your lines.