Good day, and welcome to Acadia Healthcare's First Quarter of 2024 Earnings Call. All participants will be in a listen-only mode, and should you need any assistance during the call, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on your telephone keypad, and to withdraw your question, please press star, then two. On today's call, we ask that you please limit yourself to one question and one follow-up during Q&A. Also, please be aware that today's call is being recorded. I would now like to turn the call over to Patrick Feely, Head of Investor Relations. Please go ahead. Thank you and good morning. Yesterday, after the market closed, we issued a press release announcing our First Quarter 2024 Financial Results. This press release can be found in the Investor Relations section of the acadiahealthcare.com website. Here with me today to discuss the results are Chris Hunter, Chief Executive Officer, and Heather Dixon, Chief Financial Officer. To the extent any non-GAAP financial measures is discussed on today's call, you will find a reconciliation of that measure to the most directly comparable financial measure calculated according to GAAP in the press release that is posted on our website. This conference call may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements, among others, regarding Acadia's expected quarterly and annual financial performance for 2024 and beyond. You are hereby cautioned that these statements may be affected by the important factors, among others, set forth in Acadia's filings with the Securities and Exchange Commission and the company's first quarter news release, and consequently, actual operations and results may differ materially from the results discussed in the forward-looking statements. At this time, I'd like to turn the conference call over to Chris for opening remarks. Thank you, Patrick, and good morning, everyone. Thank you for being with us for Acadia's First Quarter 2024 Conference Call. Before we get to the results, I want to note some recent key additions to our leadership team. He just introduced this call, but I want to officially welcome Patrick Feeley to Acadia as our new Senior Vice President of Investor Relations. Patrick joins the company after leading Investor Relations for Teladoc Health, and prior to that, he spent several years in healthcare equity research, covering the healthcare services sector. We wanna also thank Gretchen Hommrich for her 8 years of dedicated service leading Investor Relations for Acadia. In early April, we announced Dr. Stephanie Eken as Acadia's new Chief Medical Officer. A triple board-certified physician, Dr. Eken brings more than two decades of behavioral healthcare experience in a variety of settings. She joins Acadia after spending 15 years at Rogers Behavioral Health, a not-for-profit, nationwide independent provider of specialized mental health and addiction treatment. At Rogers, she most recently served as Chief Medical Officer, partnering with the system's executive leadership to lead patient care, quality, and facilities expansion. We look forward to working with Dr. Eken and benefiting from her experience and expertise. We also wanna thank Dr. Michael Genovese, who has served in this important role for Acadia since 2017. We're grateful for his dedicated service and are pleased that he will continue in a consulting role for the company and work with Dr. Eken as we make this transition. Now, turning to our first quarter results. Total revenue increased 9.1% over the prior year's first quarter to $768 million, driven by both rate improvement and patient day growth. Our top-line growth, combined with strong operating leverage, drove adjusted EBITDA growth of 14.9% and adjusted EPS growth of 12.0% as compared to the first quarter of 2023. We continue to be pleased with our progress on labor costs. Improvements in the overall labor market, combined with our continued efforts around hiring, retention, and quality, helped drive meaningful operating leverage and margin contribution in the first quarter. Those trends continue to give us a high level of confidence in our EBITDA outlook for the full year. On a same-store basis, revenue growth was strong, increasing 9.2% over the first quarter of last year. During the quarter, we experienced slightly weaker than anticipated same-store patient volumes. This was primarily driven by greater than typical seasonality due to the timing of spring break and Easter, which occurred in March of this year compared to April of last year. While our first quarter outlook contemplated normal holiday seasonality around each of these events, the proximity of Easter to spring break resulted in an extended period of lower volumes through the back half of March. We also experienced weaker admissions towards the end of the quarter for our military specialty programs. Given the strong underlying demand for our services in the broader marketplace, we're already well on our way towards rebuilding census at these facilities. Overall demand for our services remains strong, and we believe we are well-positioned within our markets for continued growth, especially given the visibility we have with new beds coming online and ramping up over the course of the calendar year. Now, I'd like to provide an update on each of our five defined growth pathways. For our first pathway, facility expansions, we added 27 beds during the first quarter. We continue to expect to add more than 400 beds to existing facilities in 2024, a step up from our historical average of 300. These additions will be more heavily weighted toward the second half of the year. For our second pathway, we remain focused on developing wholly owned de novo facilities in underserved markets for behavioral healthcare services. During the first quarter, we opened a 20-bed specialty facility, Sabal Palms Recovery Center, located near Tampa, Florida, which will provide residential addiction treatment services. Additionally, planning is already underway for an expansion to this facility. Following the end of the first quarter, Acadia opened a 100-bed acute care hospital, Agave Ridge Behavioral Hospital, in Mesa, Arizona. We continue to plan to open up to 14 additional comprehensive treatment centers, or CTCs, in 2024. As a reminder, our CTC service line offers comprehensive care for patients who are affected by opioid use disorder, or OUD. For our third growth pathway, we are working to expand our reach through our joint ventures. We're extremely proud to partner with premier healthcare systems across the country, with a shared mission to expand behavioral healthcare in more communities. During the first quarter, we commenced construction on 2 new hospitals with previously announced partners. Acadia held groundbreaking ceremonies for a 144-bed behavioral health hospital in Apopka, Florida, in partnership with Orlando Health, as well as another 144-bed behavioral health hospital in Malden, Massachusetts, in partnership with Tufts Medicine. These facilities will expand much-needed access to life-saving behavioral health services in their respective communities. Today, Acadia has 21 joint venture partnerships for 22 hospitals, with 11 hospitals already in operation and 11 additional hospitals expected to open over the next few years. Joint ventures will continue to play an important role in Acadia's future growth, and we are excited about the opportunities to work with other leading providers in attractive geographies. For our fourth pathway, we continue to look for acquisitions that support our growth objectives and meet the criteria of our capital allocation strategy. During the quarter, we closed on the acquisition of Turning Point Centers, a 76-bed specialty provider of substance abuse disorder and primary mental healthcare treatment services in Utah. At the end of the first quarter, we completed the acquisition of three CTCs in North Carolina, serving patients with OUD in Raleigh, Greenville, and Hillsborough, and their respective surrounding communities. These acquisitions build upon our existing and strong clinical foundation within the state of North Carolina. North Carolina is a focus for Acadia to expand capacity and add additional sites of care, given the state's immense need and progressive approach to behavioral healthcare treatment programs. With the addition of these 3 CTCs, Acadia now operates 10 CTC locations in North Carolina and 160 locations in 32 states across the country. As the opioid epidemic continues to intensify, we will continue to expand this important area of our business as we see record demand for our CTC services. It's estimated that 9 million Americans are suffering from OUD, and only about 10% of this group is in treatment for medication-assisted therapy, which is considered the gold standard for treatment. As we've previously discussed, the increasing prevalence of fentanyl, mixed with other potent drugs, has escalated the complexity and severity of OUD. We remain focused on meeting the critical demand for treatment by improving access to treatment, driving favorable clinical outcomes, and delivering an exceptional patient experience. For our fifth growth pathway, extending the continuum of care remains important to our clinical strategy. One of the key focus areas of this pathway is expanding our partial h ospitalization programs, or PHPs, and intensive outpatient programs, IOPs, that can provide 4-6 hours of care per day. These programs not only improve clinical outcomes, but also enhance the overall patient experience. We added 15 outpatient programs during the first quarter of 2024, and will continue to focus on this important clinical service. As we continue to extend our market reach, patient safety and quality, quality patient care remain top priorities for delivering the best possible outcome for our patients. Quality is foundational to every aspect of the work we do at Acadia and drives operational effectiveness. We continue to make investments in our quality programs that drive greater efficiency, including electronic medical records, patient monitoring technology, and employee safety technology. We also recognize the importance of having quality measures and the right technology in place to make sure we're providing data that aligns with what our payers want to measure. We expect to compete on the strength of our clinical outcomes, and the ability to measure and demonstrate these outcomes is important for our collaborations with payers. We're proud of the important work that we're doing. The demand for our behavioral health services across our nation has never been greater. Every demographic is affected by the lack of affordable access to behavioral health services, especially for the poor and elderly populations. While 1 in 5 adults have a mental illness, less than half of those receive treatments. A recent report from the Office of the Inspector General, or OIG, found that about 1/3 of behavioral health providers in selected counties serve patients in the Medicare, Medicare Advantage, or Medicaid programs. The shortage of providers also explains the lower use of the behavioral health system, with only 8% of Medicaid enrollees and less than 4% of Medicare and Medicare Advantage enrollees receiving behavioral health services. Acadia is dedicated to serving the needs of Medicare and Medicaid patients, as well as all other patients who come to us for care. For example, Acadia has 10 facilities that serve Medicare and Medicaid beneficiaries in the top 20 underserved counties cited by OIG in the study just referenced. We believe there are significant opportunities ahead for Acadia to extend our market reach to serve even more patients in 2024. Our strategic priorities will focus on accelerating facility growth, expanding services across the care continuum, strengthening our core capabilities, and strategically leveraging technology to enhance patient care and improve clinical outcomes, all with a focus on delivering the highest quality patient care. We're well-positioned to meet our objectives with our impressive scale and proven operating model across our network of 258 facilities, the financial strength to support our continued growth, and over 23,500 committed employees and clinicians who work hard every day to address the nation's critical need for safe, quality treatment for mental health and substance use issues. At this time, I will now turn the call over to Heather to discuss our financial results for the quarter. Thanks, Chris, and good morning, everyone. Our first quarter financial performance reflects continued growth across our business and a solid start to the year. We reported $768.1 million in revenue for the quarter, representing an increase of 9.1% over the first quarter of last year. As Chris discussed, we experienced certain headwinds in the quarter that affected our same-store revenue and patient day growth by approximately 150 basis points. Despite this, we drove same facility revenue growth of 9.2% over the first quarter of 2023, including a 6.9% increase in revenue per patient day and a 2.2% increase in patient days. Adjusted EBITDA for the first quarter of 2024 increased 14.9% over the prior year to $173.9 million. Adjusted EBITDA margins expanded by over 100 basis points over the prior year's first quarter to 22.6%, a reflection of strong cost control efforts, particularly on the labor line. Adjusted income attributable to Acadia shareholders per diluted share was $0.84, up 12% from the prior year. Consistent with previous periods, adjustments to income for the first quarter of 2024 include transaction, legal, and other costs and related income tax effects of all items. We continue to focus on maintaining a strong financial position, providing the flexibility to deploy capital and make strategic investments in our business that offer the greatest return. As of March 31, 2024, we had $77.3 million in cash and cash equivalents and $371.5 million available under our $600 million revolving credit facility, with a net leverage ratio of approximately 2.5x. Moving on to our outlook for 2024, as noted in our press release, we have affirmed our previously announced 2024 guidance, which includes: revenue in the range of $3.18 billion-$3.25 billion, adjusted EBITDA in the range of $730 million-$770 million, adjusted earnings per diluted share in the range of $3.40-$3.70, and total bed additions, excluding acquisitions, of approximately 1,200 beds. Please note that our guidance includes one-time payments from a state of approximately $10 million, or $0.09 per diluted share for the year, of which approximately $7 million, or $0.06 per diluted share, was received in the first quarter of 2024, in line with our prior expectations. Also, as a reminder, the company's guidance does not include the impact of any future acquisitions, divestitures, transaction, legal, and other costs, or non-recurring legal settlements expense. With that, operator, we're ready to open the call for questions. We will now begin the question-and-answer session. To ask a question, you may press *, then 1 on your telephone keypad. If you're using a speakerphone, please pick up your handset before pressing the keys. To withdraw a question, please press *, then 2. Again, we ask that you please limit yourself to one question and one follow-up during Q&A. At this time, we will pause just momentarily to assemble our roster. We will now take our first question, which will come from Scott Fidel with Stephens. Please go ahead. Oh, hi. Thanks, good morning. First question, just, just in the context of some of the volume headwinds that you did cite in the first quarter and also had talked about intraquarter. Just, interested in sort of how you're thinking about, the achieving of the full year, revenue guidance. Is there a particular sort of area of the range, that you're comfortable with in terms of the low end, the, the mid-range, the higher end? And then also, if you can talk about how you're expecting, volumes and patient days, to sort of ramp now, from the first quarter over the balance of the year. Great. Scott, thanks for the question. This is Chris. I'll start and, maybe let Heather pick up on, some of your questions on guidance, but maybe just a little bit of backdrop on volume. You know, as we had previously discussed, January got off to a little bit slower, than expected start coming out of the holiday season. And then we saw a really nice improvement in February and certainly into March, and we felt really good about where we stood at that point. You know, as we approached the back half of March, we began to see some softness in volumes. And it's, you know, of course, normal for us to experience lower volumes during holidays and school breaks as, you know, our patients spend more time with their families. However, what we found was an extended period of slower admissions in between spring break and Easter, which was earlier than usual, that being Easter, at the end of March this year. So while we baked normal holiday seasonality into our outlook, what we experienced was significantly stronger seasonality in March, really due to this dynamic. We also had two markets where government facilities opened access to new behavioral beds, and this resulted in a temporary slowdown in admissions to several of our military specialty programs in those markets toward the end of the quarter as those new beds were filled. We're already well on our way back to building back census at those facilities, and we expect to be back on track by the end of the second quarter. The issues that weighed on volumes in March, while they were certainly frustrating, were distinct issues that we just don't expect to have a lasting impact. We've seen consistent improvement in volumes over the course of April. We expect to be back on track by the end of the second quarter. We continue to expect mid-single digit same-store patient day growth in the second half of the year. And what gives us confidence in the back half of the year is that we really start to see a benefit from the ramp and a number of the bed additions and the JVs that we put in place last year, as well as the expansion plans for this year. Heather, anything you want to add from there? Yeah, yeah, sure. Maybe I'll just pick up on the questions around sort of what we expect to see in the following quarter. I mean, as you know, we don't provide quarterly guidance except for the first quarter amounts that we issue, but we, you know, we did experience these issues towards the end of March, and that resulted in a little bit of a slower start to the month of April. So we'll still have a similar drag to second quarter in the same-store growth numbers. Just recall that our specialty facilities have a longer length of stay. It's usually about 28 days or longer, and so you get a little bit of a lag effect whenever you have a delay in admissions for patient days. Then if I think about the full year, as we discussed in February, our guidance already contemplated that we would have a little bit slower start to the year at our sort of slightly below our mid-single digit target. And obviously, first quarter finished a little bit below that expectation. And then the knock-on effect that I just mentioned will have a little bit of a slower start to second quarter than we previously would have assumed. But as Chris said, we continue to have a lot of confidence in the back half of the year as we benefit from that ramp up of bed expansions and JVs that we opened over the last several quarters. We have a large number of beds that'll come online throughout the second half, and so that gives us a lot of confidence. So while the first quarter volume was a little weaker than our expectations, when I look at the prior year comps and the ramp that we're seeing in beds that we've added over the last several quarters, and then the new beds, of course, I think we'll be comfortably in the mid-single digit range in the second half and within striking distance of that for the full year. Appreciate all that color. And just as a related follow-up, just, appreciate all that color on, on the ball side. Just wondering on, on the rate side, on, on the pricing side, how things are developing so far in line with your expectations. Looked like you did have a solid pricing print in the first quarter. You did have some benefit from that one-timer you had called out. So just interested in sort of your updated views on, on pricing for the year relative to how you were thinking about the initial guidance. And that's it for me. Thanks. Yeah, sure. Yeah, you're right. We did, as we discussed in February with our guidance, we did benefit from the $7 million of one-time state supplemental payments, and that was probably around 100 basis points on our, same-store revenue per patient day. Remember, we also have CTC growth that, that goes into that calculation, and that contributed probably around the same amount, about 100 basis points to the year-over-year patient day growth. And then when I think about those same-store comps, the first quarter does have an easier comp than the rest of the year. So we're not assuming that the year-over-year revenue per patient day growth continues at the same pace as first quarter, for the rest of the year. You know, just taking you back to our guidance that we put out in February for the full year, we talked about revenue per patient day in the mid-single digit range, and that hasn't changed. Our next question will come from Whit Mayo with Leerink Partners. Please go ahead. Hey, thanks. Can you maybe comment a little bit on closures or divestitures in the quarter? It looks like the prior year comp was a little bit lower than we expected. Yes, if you think about what affected the quarter, with, if you recall, we had four facilities that we closed last year throughout the year, and those would have certainly been in Q1 last year, but not in Q1 of this year. Three of those were in the specialty business, and then one was in the acute side. Then we had one other closure in Q1 of this year on the acute side. Okay. Other question I have is, we're going to get the physician fee schedule out, I guess, in the next month or so, and there's probably going to be some language or discussion around the CTC, OTP business. Just curious if you have, you know, any insight, perspective, thoughts around, like, what we should expect when you put your, you know, policy regulation hat on, any comments would be helpful. Thanks. Well, this is Chris. So you're referring to the CTC business specifically? Yeah, yeah. Just like, you know, in reference, like, are they going to look at rebasing the bundle? Just, just any, any commentary or thoughts you have from your policy people around, like, what, what we may see or expect. Yeah, I would say overall, we're just on the CTC front not expecting anything material. You know, SAMHSA and HHS have made some favorable rule changes just regarding the regulation of CTC clinics in their, you know, recent rule update. And I think there were, you know, really three main areas of positive change on that. You know, one was just continuing take-home flexibilities. There was also one around the ability to use telehealth more broadly, and the third was just enablement of small format medication units that can allow the full range of OTP services. But other than that, you know, would be just speculative. Our next question will come from Brian Tanquilut with Jefferies. Please go ahead. Hey, good morning, guys. Maybe Chris, first question for me, you know, just as we think about the, sorry, legislative efforts to make changes to methadone treatment access, maybe just curious to hear your thoughts again on, I think, if implemented, that these changes would affect your business. And then maybe tying that to, you know, maybe comments from the DEA recently on other drugs used to treat opioid addiction and how that's tracking in terms of, you know, expanding access for folks who are addicted to opioids. Yeah, no, thank you for the question. I would say that, you know, overall, we continue to be very strong proponents of increasing access to OUD care, and there obviously are a number, you know, of, you know, policy proposals out there. We have, I think, done an excellent job in our CTC business of focusing on patient quality. CARF is the regulatory body that measures the, you know, the OUD players, and our quality scores have continued to be in the 98%+ range. And so we continue to believe that our focus on quality, our focus on patient outcomes, where, you know, we find that, you know, 90% of our or 80%+ of our patients are illicit opioid free within six months of treatment. We've operationally put in all sorts of patient, you know, very positive changes over the course of the last six months, including significantly reducing wait times, and our patient satisfaction is really up as well. So with all those things together, we just continue to feel like, you know, we want to continue to expand access. We're gonna continue to make significant investments in this business. You know, we'll continue to monitor the legislation and, you know, continue to work with lawmakers in expanding access and moving that along. Got it. And then maybe just any update you can share with us on litigation in New Mexico? You know, the only thing that I would say, you know, if you're referring specifically to the Six Desert Hills case, it's just very difficult for us to comment on pending litigation, but you should know that there's much still to be tested in court, and we intend to vigorously defend the company on that case. We were served with an amended complaint on March 25th, and we filed initial pleadings on April 24th, and I would just say our legal team is very diligently working on developing the case. Our next question will come from Andrew Mok with Barclays. Please go ahead. Thanks. Good morning. First, just wanted to follow up on the volume trends in the quarter. So it sounds like the quarter was bookended by seasonal factors in January and March, and further impacted by the new military facility openings. Were all three of those items expected in the quarter and just had a greater than expected impact? Or were any of those items, you know, truly a surprise, maybe the military facility openings you didn't have visibility into? Can you just clarify that first? Yeah, sure. I would say those were not expected to the extent that we saw them. The first thing I would tell you is that the seasonality, the difference between spring break or the interval between spring break and Easter, certainly we would have anticipated normal seasonality around each of those events. B ut the difference was the interval between the two. And so, of course, we anticipate the events, but we didn't anticipate that significant difference in the interval between the two. In terms of the few facilities with the military business, those beds opened earlier, at the other facilities, opened earlier in the quarter, but we didn't see any impact of that, for, you know, several weeks, and so that did sort of pop up as a surprise to us in the second half of March. And that's just really thinking about those facilities. It was more heavily weighted to the specialty business. And keep in mind that those have a longer length of stay, and so it takes a little bit longer for sort of a downturn in admissions or a shortfall to flow through, and so we would not have anticipated that either. Those are really the two things that came up in the back half of March that we didn't anticipate. Got it. Okay. And then your SWB per patient day in the quarter, I think, finished below 5%, 5%, despite the headwinds from patient days. So anything in particular that helped to drive the strong result there? And given the normalizing patient day trends we should be seeing, you know, in 2Q and 3Q, is it reasonable that SWB per patient day continues to track below 5%? Thanks. Yeah, you're right. It did track below the 5%, which is, as you recall, what we discussed last quarter and where those levels we anticipate staying, and, you know, we see base wage inflation coming in line with SWB per patient day as well. You know, we continue to focus on all of the things that we have been focusing on for the last, I would say, 12-18 months in regards to, you know, employee engagement and retention, and we're seeing the benefits of that come through. You know, we'll expect that same level would continue throughout the year, and we'll keep a very close eye on it. As I'm sure you can appreciate, as any company that operates in multiple geographies across the country, we still have some pockets with challenges, but we feel really good about what we've been doing and the investments we've made so that we can have a great start to 2024. So just maybe to wrap that up, for the full year for 2024, we still expect that base wage inflation and SWB per patient day will reflect that normalized rate. Just maybe to add in on base wage inflation, I mean, we clearly saw the high water mark in the fourth quarter of 2022 and have been, you know, as Heather said, just very focused on our efforts around employee engagement, around retention, working with the local market operators, and have been able to continue to bring that down to ending the year under 5%. You know, as Heather said, you know, likewise, with the SWB per patient day, also being under 5%, you know, we see that trend continuing. Our next question will come from Ben Hendrix with RBC Capital Markets. Please go ahead. Thank you very much. Just wanted to get some follow-up commentary on your Partial Hospitalization Program and IOPs, kind of information on where they fit in, in terms of your development strategy going forward. Should we think about those as just an extension of the acute platform, or could this be a new leg of the stool in terms of your, your business line segmentation? Thanks. Yeah, thanks, Ben. You know, we really believe that the impact of PHP, IOP on the clinical outcomes of our patients can really be significant. You know, the vast majority of both our acute and our specialty patients are indicated for PHP or IOP as a step-down therapy post-discharge, and we see the clinical outcomes from that and that continuity of care being extremely important to maintaining those strong outcomes. You know, given the value to the patients, we have begun to build these programs out in some form at or near most of our acute and specialty facilities. But for multiple reasons, you know, we continue to see opportunity for growth in the future. I mean, I think there's opportunity in expansion in the number of PHP, IOP programs per facility. We have real variability across the company in terms of how many tracks of PHP, IOP we have at a given facility. We also look at each of our facilities for opportunities to just better serve our patients by adding more programs. So, you know, adult versus adolescent, women's focus, evening versus daytime, and just PHP versus IOP in general. So I think just overall, increasing the share of the clinically eligible patients who benefit from PHP, IOP is in the best interest of the patients, and we need to be more intentional about ensuring that continuity of care. And we really try to address the needs of the community and how we can best impact that continuity of care. So we are opening new facilities. We're working through licenses and certifications. We're looking at what the most appropriate programs are to add initially, and we're also looking hard at the ability to cross-refer across our Acadia lines of business where possible. You know, as we've said before, we know that 70% of our specialty patients that present also have an underlying OUD diagnosis, and so that cross-referral is also very important. So we just see this pathway as something that has a lot of opportunity for our patients because of the strong clinical outcomes, and, you know, we intend to capitalize on it. Thank you very much. Just a quick follow-up on the labor trend. Is there any way to quantify how much perhaps incremental hiring or recruiting costs we might see later in the year as you know your development pipeline plays out in the second half? Thanks. You know, I don't know that we'll quantify the amount, but I can tell you that we have assumed that sort of the normal course of business will continue as we've seen it sort of throughout the back half of last year and then continuing into Q1. So, if what you're asking is if we're assuming an elevated level, then the answer is no. Our next question will come from A.J. Rice with UBS. Please go ahead. Hi, everybody. Maybe first, just to ask, we haven't talked in a while about the opioid settlement and how those dollars states or maybe whether any of that's flowing to your areas of focus. And to the extent it is, is that in a little more healthy rate updates, or is it in other areas? Any comments on that? Yeah. Thanks, A.J. This is Chris. I'll take that one. I think just to step back, the settlement funding continues to trickle along. So again, of the roughly $50 billion of funds available, approximately $4.5 billion have actually been distributed to date. And just to give you some context on that, in mid-2023, we were at $3 billion. So, you know, still under 10% of funds have actually been distributed to the states, and then obviously from the states, they have to be deployed to individual counties. You know, we see a number of states leading the way on this, and we continue to position ourselves, just given the very strong clinical outcomes that we're seeing in our CTC business, to participate in those grant funding opportunities and to win. And so, you know, the best recent award settlement example that I can give you is that in Q1, we were awarded funding by opportunity in Tennessee. And we were actually awarded—I think there were over 400 different applicants, and we were one of the top recipients. We were awarded $6 million in funding by the Tennessee Opioid Abatement Council. And the funds there are gonna, you know, meaningfully contribute to treatment to underserved populations, which is really what the focus of the grant was. Hiring peer support personnel to help patients go through their recovery and just overall helping patients stay in treatment, particularly by covering expenses associated with social determinants, such as transportation. And so, of that $6 million, we're right now—you know, we have won that $6 million component. We're in the contracting phase. Funds will take a few months to be disbursed, but we expect this to be $2 million a year over a 3-year period. Okay. Hopefully that's helpful. Yeah, that's good. And then on, maybe on the development and acquisition pipeline, there's been some recent scrutiny, both in some of the articles that have been written about opioid use disorder, et cetera, as well as in some of the congressional activity around private equity and healthcare generally, and questioning that. I wondered whether. Is that, because I know private equity is quite active in some of your spaces, has that impacted anything, both created any new opportunities for you, changed any way the competitiveness of transactions you're looking at? Yeah, I would. Thanks, A.J. I, I would say to start that this has been a very difficult operating environment for a very fragmented industry of, you know, various players in the OUD space. So, you know, you'll recall a year ago at this time, we were so focused on Medicaid redetermination and made significant investments in putting a dedicated 800 hotline in place, putting kiosks in place for our patients, you know, actively preparing to help them manage through the complexities of redetermination, which, you know, I think we have done. Our team has done an excellent job on. But that has been really challenging for a number of players, and I think we are increasingly seen as an acquirer of choice. So we've seen interest from a lot of smaller clinics. You know, the three clinics that we recently acquired in North Carolina, I think are illustrative of that. They're now fully operational, strong track record of positive patient outcomes. But, you know, putting those on our chassis, you know, we're able to serve these patients even more efficiently, particularly given some of the advances in technology that we've made there. So we're now in North Carolina. We've expanded from, you know, seven CTCs with these three additions to 10. You know, we're a real market leader in the state there, and we continue to think that there will be additional M&A opportunity, particularly from, you know, in this space that remains so fragmented. I think your question may also tie to some of the larger private equity scale players. You know, we really have not seen, you know, a lot of activity on that front, but it's just, you know, difficult to say how that will continue through the year. But we from, you know, from an attractiveness of these smaller opportunities, we continue to be, very positive on those and continue to pursue those. Our next question will come from John Ransom with Raymond James. Please go ahead. Hey, good morning. You know, some of your provider, I guess they're not peers, but other providers have called out kind of the Medicaid redeterminations as being a thing in their results. So are you seeing anything with either health exchange enrollment or Medicaid redeterminations to call out so far this year? Hi, John. No, no, we're not. I think you're referring to, as patients move from Medicaid, maybe through the redetermination process and onto the exchanges, are we seeing any impact as a result of that? And we're not. It's a very, very small portion of our patients that would be in that category. Those are mostly in the CTC business, but again, it's a very, very small percentage of patients. Okay. Then my follow-up is just going back to corporate overhead. You know, it's running, you know, about $26 million higher than it was in, you know, 2022 to 2023, and then it's, you know, elevated again, although at a slower pace. Can you just give us an outlook for corporate overhead for the remainder of the year and just kinda remind us where those dollars went to, you know, whether it's technology or people or other? Yeah, sure. I'll kick that off, and then Chris may wanna jump in on the last part of your question. So you're right, we did see a sequential increase of about 20 basis points, but on a year-over-year basis, we saw an improvement of about the same amount. And that's what I would consider, you know, the lowering of the baseline of growth there, because we have really been focused on those corporate costs, but also normal seasonality from Q4 to Q1 that we typically see. A couple of reasons for that, it might be, you know, merit increases or, you know, as some of the differences that come in Q1 from a payroll tax perspective come into play, but that's what I would consider normal seasonality. I mean, in general, you know, we've seen the stabilization, as I mentioned, in those corporate costs, and we're starting to really see the benefit of some of those investments. Maybe just to think about how we view the balance of the year as those investments continue to pay off, and frankly, as we start to lap some of those investments from last year, we'll expect to continue to see operating leverage as we move throughout the year. We expect that the corporate costs will stay relatively consistent, certainly as a percentage of revenues, and then they'll moderate, and just create that leverage. And just the last part of your question on what we've been focused on, it's across the board. You know, we've, of course, invested in IT. We've invested in quality. Our managed care team has really been a big focus and a benefit to us, some of the marketing things that we've done. So just overall, just looking across the board, no one specific area, I would say, outpaced. Yeah, John, this is Chris. I think the only other thing I would say is just that we continue to watch this very closely. I think we also, just given the commitment that we put out at our first ever Investor Day in December of 2022, we really felt like there was too much variation across the company in terms of the way we were approaching quality and IT and just, you know, other corporate areas that we needed to make some investments. And we feel very pleased with what we've been able to do there and some of the talent that we've been able to attract, but also some of the process that we've put in place and some of the results that we're, you know, continuing to see that position us well for the future. So we'll continue to watch it, moving forward. Our next question will come from Pito Chickering with Deutsche Bank. Please go ahead. Hey, good morning. Thanks for taking my questions. So lead off here, I know that you don't give quarterly guidance, but with the comments on a slower start to April and the lagging impact from the longer length of stay patients and specialty, can you give us any commentary around if 2Q consensus is mismodeled? Yeah, you know, as you know, we don't give quarterly guidance except for first quarter, and, you know, really don't like to comment on consensus and how the modeling comes in. I'll just maybe reiterate, Pito, what we said. You know, when we think about how the quarters will play out, we think that we will have, you know, a similar drag to the beginning of 2Q, certainly on a same store basis, just as we start to bring ourselves through the second quarter. Q1 obviously was a little bit slower, and that's gonna drive a little bit slower start to Q2, but we really have a lot of confidence in the back half of the year. Okay. And a follow-up here. You know, despite the seasonal softness that you guys talked about, your EBITDA margins are 22.6% or the highest first quarter that we've seen. Is there any sort of one-time benefit that you guys saw on the cost side, or should this be a baseline margin view as you start grow from in 2024 and 2025? And besides the one-time $10 million payment, are there any new supplemental Medicaid programs that started in 2024? Thanks. So maybe I'll take that in two parts. So in terms of EBITDA, when we set out the guidance at the beginning of the year, we said we expected to see some leverage, and so we are seeing that leverage. We really, really pleased to see that we're outperforming in the first quarter, and that's driven largely by the SWB line, which, of course, we've been very focused on, over the last twelve months. As we're, you know, doing the work, around all of the things we've done to invest in the higher retention, we're just seeing that, as we said earlier, continued moderated rate. But also, I think it's important to point out, we were able to really react quickly, to some of the softer volumes that we saw. At the end of March, and I think the team did a really good job of just managing through that. And so that gives us a lot of confidence, really, in the EBITDA outlook for the balance of the year. If I think about those sort of payments and what those supplemental funds look like, I think that's where you're headed. I mean, you know, some states, as you know, use this to enhance what they can pay for the Medicaid rates and really to bolster those and, you know, intending to correct for what's, you know, frankly, historically inadequate reimbursement for keeping up with the costs of care for our patients. And you know, I know some of our peers have had some large distributions in specific states. We typically see those on a year-to-year basis. They're relatively consistent, and frankly, we just consider it part of our reimbursement as we go through. That said, if we have something that's outsized as a one-time payment, we'll call those out. I think we've done it a couple of times in the past, and as you mentioned, we called that out sort of for one state with our guidance that we put out earlier this year, and that was, you know, $10 million for the full year and $7 million in Q1. Our next question will come from Sarah James with Cantor Fitzgerald. Please go ahead. Hi, this is Gabby on for Sarah. I just had a quick question on what results you guys have seen from the remote monitoring at the 53 facilities that you had rolled out by the end of last year, and if you have any more plans to add to more facilities. Thank you. Yeah, Gabby, this is Chris. I'll take that one. You know, we've seen very positive results from the remote monitoring that, you know, we've now implemented in all 53 of our acute facilities. You know, this is technology that we think has been critical to ensuring that our scheduled observation rounds are taking place at the appropriate time. I think our staff has told us that, you know, they feel safer and more comfortable with, you know, this mechanism in place. Our patient experience and our patient satisfaction scores have actually gone up, and we've gotten extremely positive feedback from surveyors that have come into our facilities, being able to show them the results that we've had from this monitoring, whether it's state surveyors or, you know, even, you know, talking to others across the board, just it's been very consistent feedback, you know, positive feedback. So we are looking at potentially expanding that even further. We've also have been investing pretty heavily in staff safety with personal alarm buttons for all of our hospital staff that we're also rolling out this year. And I think you will continue to see more of that, you know, as we look to continue to improve our overall employee engagement, but also our patient satisfaction, and it's proving out. Okay, awesome. Thank you. This concludes our question-and-answer session. I would like to now turn the conference back over to Chris Hunter for any closing remarks. Thank you. Before we end the call, I just want to again thank our committed facility leaders, clinicians, and approximately 23,500 dedicated employees across the country who've continued to work tirelessly to meet the needs of the over 75,000 patients that we treat daily and their families in a safe and effective manner, and who every day exemplify our purpose as an organization to Lead Care with Light. We have a strong foundation and a proven strategy for driving growth and delivering greater value to both the patients we serve and our shareholders. Thank you for being with us this morning and for your interest in Acadia. If you have additional questions today, please do not hesitate to contact us directly. Have a good day. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect your lines.