Okay, well, welcome back to the Stephens Investment Conference, live and in person in Nashville. Great. I'm Scott Fidel. I'm the healthcare services analyst. We're delighted to have Amedisys here joining us for our next, fireside chat panel. Amedisys is one of the leading operators of home-based, home health, hospice and other growing areas of the business, and the home side. We've got a full team here today. We've got Paul Kusserow, the Chairman and CEO, Scott Ginn, who's the Chief Financial Officer, Nick Muscato, who heads up our finance, SVP of Finance and Investor Relations. Really pleased to have a special guest with us today as well, Travis Messina, who is the CEO of Contessa, which Amedisys just recently acquired and is going to be a new growth platform on the Amedisys chassis. Looking forward to the conversation, guys. Great. Thanks so much for joining us today. Yeah. It's great to see you all in person, especially. Good to be here. Um- Good to be in person. Yeah, absolutely. Amen. Paul, thought maybe we could start with some thoughts from you and maybe if you wanna give us your latest state of the union here on the status for Amedisys as we're heading into 2022. Sure. Your thoughts. Obviously, it's been quite a dynamic 12, 18 months, right? Help us, give us your thoughts, too, as we look out to 2022 for the industry a bit too, sort of, what's in your crystal ball here? Sure. Let me talk initially. First, thank you for having us. We really appreciate it. Let me talk initially about our strategic goals, and then I'd like Scott to talk about you know what we're looking at for the next year to three years. I'm just really excited about this company more so than I've ever been. A couple reasons. We're in a labor shortage world, and couple years ago we decided that we needed to be the best firm at retention, and we needed to hire the best people and retain them. We built a very interesting and probably I believe best in the industry recruiting function as well as our turnover rates have actually come down in half. Last, I think a year ago, we reduced our turnover even more. The key is as the labor markets get worse and worse, the issue is not gonna be demand, the issue is gonna be capacity. Who's gonna have the capacity? We've had a couple years into this, and I'm very excited about things we're exploring. We still think there's a lot of juice left in the orange. You know, we're using these really interesting techniques of mixing RNs with LPNs, PTAs with PTs. We've made a major investment in Medalogix. Nick's on the board. And that's really helped us with utilization management. Then I don't wanna steal any of. But I probably will. I don't wanna steal any of Travis's excitement here, but we're very, very excited about Contessa because it brings us into a unique and distinctive place where we're taking care of higher acuity patients, and we're doing it at risk. We're really delivering value-based care with Contessa. It's a very unique, and we're proud that it's part of our portfolio. We're very impressed with what Travis has done. The way I look at it is, it's doubled our TAM. The other thing is, we're playing. It also allows us to go where no one else has gone, which is always important from a distinction perspective. The fact that you're doing hospital at home, SNF at home, palliative at home puts us into some really interesting parts of the world. The fact that we're moving into risk is really important because that's where the world's gonna play. When Medicare Advantage is growing at 7x what fee-for-service is, that's gonna be the coin of the realm. What we have to do is really embrace that. The other thing is, with these capabilities and some of the other capabilities we're building, particularly with Medalogix and some of these other things, we believe the quality and the outcomes that we have consistently generated by having excellent operations is you know, we're going after. We have some very good ideas about risk-based models with Medicare Advantage that will benefit them considerably in terms of access and capacity, but also benefit us if we take over that role of managing the care, which is what you get when you delegate, but having this ultimately be delegated and done case by case. So we're out there having a lot of really good conversations there. I think, again, we're the only ones who can do that. We know how to deal with risk. Half this management team comes out of the managed care business. The other half of the team, not equally half and half, but so we have one side of the company that really knows risk and likes risk, and we have the other side of the company which has run incredibly good, tight businesses that give us the predictability and the outcomes confidence and the quality out there that we can start taking risk on some of these areas. That's where we're moving as a company. I think, one, it'll distinguish us. We have more capabilities, broader business. We're doing well in the core of the business and extremely well in the core of the business. I'm very excited about where things are going. Scott, you wanna? Yeah, sure. Turn this up a little bit. Yeah. You know, we talked a lot and you know, really thought about you know, coming into 2022 and you know, if I said internally and I probably said it externally. I mean, 2022 is really about 2023 and building back. I mean, certainly we've had some hits here through the Delta variant and what that did and how that impacted our business from a census perspective. And then, you know, it's a unique year for us because as we'll see, you know, sequestration giveth and sequestration taketh away. Certainly enjoyed the fact that we got a 2% bump in reimbursement coming out of sequestration. But now, you know, it comes off the table. Where we'd normally be going into a year, you know, plus roughly 2% on hospice reimbursement plus 3.2% now, which is roughly where we'll be at the final on home health, I mean, you know, that'd be a pretty nice growth year for us. We'd be typically growing in the just coming out of the gate, you know, that's probably plus $40-$45 million. Now you gotta be offset by revenue. We'll probably be plus $10 million. If you think of that directionally as you look at EBITDA movement, that's certainly something we've gotta think about. If you take a normal year going from 2022 to 2023, what that means from that when you're plus 40-45 versus plus $10 million because you're losing sequestration, but the reimbursement's there correctly. I think for that really makes us feel good about our long-term outlook. You know, nothing's changed. The tailwinds that were in this business before COVID are still existing. None of that's changed. We have some excess death rates that have impacted our hospice ADC. We think that settles back out at some point. You know, unfortunately, we'll have to be somewhat conservative coming out on discharge rates because, you know, we got burned in Q3 when they were higher than we ever saw in 2020, which was odd for us. Some of that's gonna make and why I talk about 2022 as a rebuild and a base back. We're in great shape from the BD staffing, we're as strong as we've ever been there. Those people are gonna mature. You'll see that growth throughout 2022. We feel strong from the long-term dynamics of this company. We've got to work through some of the noise around excess deaths. We think that has moved some of that, but we do think that settles out into 2023. You know, I think that and our ability to continue to grow this, the addition of Contessa, what that means from an inorganic on the home health and hospice side, I think is something that is an added benefit that we're seeing. We're at the table with a lot of these large JV hospital systems. We aren't a large JV player. We do have JVs, but we're very attracted to looking at large hospital systems that do JV. Not gonna change our model. We do a bunch of small rural JVs, but, you know, when there's opportunities in large multi-hospital systems, that's very attractive to us. I think the future's bright from both an organic and inorganic side of our business. Our future is so bright, we have to wear shades. We should have brought our shades. Scott, I appreciate how you laid out all the headwinds and tailwinds on 2022. Yes. Maybe if I can try to- Sure. Convert that, you know, into a bit of a quantitative. Absolutely. We've all been taking a couple bites of the apple, right, recently. Right. On trying to get 2022 EBITDA sort of positioned properly. The Street settled at around, I think, $300 million or $400 million now at this point. You know, as you sort of look at street models and you look at the framework, you know, that you've just been providing, do you think the Street is getting closer to a reasonable level, or are there still some things you think that folks need to take into account? I think it's getting closer. I mean, we said before that we felt that we had the ability to grow EBITDA. Now, you know, we're working on that and doing the same thing right now, and I think there are a lot. There are three models out there that are in excess of 320 right now, I'll tell you. Those are out of whack. Certainly as they look at those models, those should tighten up a bit. I think it's a lot closer and I feel better where they're headed right now. I mean, we're finalizing our planning for next year, looking at numbers. You know, this new variant's out there, we haven't seen anything in quarantine increases or anything, so we're thinking through that in our exit rate census, is that gonna be impacted? Right now we feel good about that. It's something we'll watch closely, which, how I exit the year from a census perspective matters a lot into next year. We'll watch that. You know, I feel much better about where we are right now. We're looking, you know, making decisions around investments in the business. That's the other thing. You know, Contessa, I'll say this: You know, we were very excited about Contessa's pipeline coming in. I think that's only getting better and the opportunities are only getting better. What does that mean for us as we move faster on the top line? Are we gonna have to impact EBITDA faster? We're, you know, looking at those models and seeing what we wanna do there, looking at de novo, something that if I had anything that I somewhat regret in the past, it's that we slowed down some de novos, which have been very profitable for us when we had pressure on top line. I'm thinking about that as we move through. If there's any movement there, it's gonna be around decisional items, around investments we wanna do in the business, with the theme being around 2022 is about 2023, because we think that's a hugely opportunistic year for us. Maybe, Scott, talk a bit about, you know, what we're thinking about finally the shaking out of the industry potentially and our M&A approach. Sure. Yeah. I'll say at the risk of we've been saying it a lot and it hadn't happened yet, but we still believe it. I'll say it with conviction at least. You know, yeah. We still think and you know, PDGM, as we go back to you know, rolling into 2020, a lot of changes in the industry come out of PDGM. It's a different world. What happens around you know, now there's you go from getting 60% of your payment within 15 days to now you're at zero, totally changed the dynamic of the business. It's certainly a little bit more complicated. Now you've added this labor pressure. Certainly that's impactful to us. If you think about from a balance sheet perspective and staying power and ability to react to that, I think we're gonna be as strong. We're you know the larger players and we're certainly one of those who are gonna react to that better. I think that's added another dynamic that we believe consolidation's coming. Sequestration goes away 1/1/2022. You know we feel it's out there. You know we're having more and more conversations. As I said earlier the JVs are coming into our pipeline opportunities, that's exciting. I think we're gonna consolidate this industry. It's about quality assets and you can get to the finish line though. I'll always hold that out there. We're positioned, you know, roughly 1.2x levered, the ability to lever up, the ability to strong cash flow. You saw us through the spending $700 million and had little of an impact that had on our balance sheets, you know, through doing those transactions. Are you guys still thinking, you know, the pivot to home health from hospice is what's on the come? Yes. Yeah, absolutely. I mean, I'd say we love hospice still, so I'm not backing away. It's just gotten very, we would say ridiculously expensive at some of the deals that we've seen done. Very happy that we did our four deals, and we did them. I mean, I think that sometimes it's well, some call it a strategy, but sometimes it's better to be lucky than good sometimes. We did it at the right time. It was the right call. I think we're very happy with what we have, but now we have to, you know, I would say that we've been staggered a bit by our normal growth trajectory because of, you know, our acquisitions are impacted by discharge rates as anything. It's not the ADC levels from a timing perspective we thought we'd be at. We think that rebuilds, so we're not, you know, worried about that. It's just it's been delayed just as our hospice ADC year-over-year has been delayed. That's just something we have to work through the system. But, you know, they're all on our platform that all that transition happens on time. We're getting the synergies we thought out of those deals. But now, you know, there's a lot of small, kind of sub-45 ADC care centers that we need to move on, and that's a lot of that portfolio, which is what the opportunity was to us anyway. Yeah, we have a really good formula for hospice, but it takes about two to three years to churn through. Clearly, we lost some time with some of the changes that COVID caused. We got wonderful pricing on these deals. Some of the deals that were done, we've seen them all. Some of the deals that were done, you know, with some of our competitors, I think what was really interesting is they're trying to get to where we are in hospice because I think they understand the value. Problem is the market is so overheated in the hospice valuations that you just, it doesn't work. Ultimately, I think, you know, hospice is something that needs a really strong integration plan. The way we approach it is we find high-quality assets with subpar ADC, generally pretty low growth rates because we can grow hospice pretty well, and then subpar margin. We attack all that, and then we get it up to our margin, our ADC. There's a tremendous magic, where you, when you get ADC up out of beyond 45, ADC, and then the real magic occurs when it goes above 100. In terms of the margin, it goes from about 7% to maybe 15, mid-teens, up to 30. That's how you play it. What do you need for that? Sales folks. Where did we stumble a little? Sales folks. Because of COVID. Now we have our full capacity of sales folks. They're focused on the low ADC centers. The only issue is when, as Scott was talking about, with discharge rates, with death rates, means that churn is there. We have to feed that really hard just to stay even. Once that churn stops and dials back again, then we can grow that ADC, and the economics kick in very nicely. That's one thing we did see, just kind of if you don't mind kind of going back to that a little bit. On the acquisitions we did, and the last one we did was in the middle of COVID. June 2020, we did this AseraCare deal. When you go look at that, those care centers, a lot of those are in those sub 45 ADC. We saw a lot of turnover at the clinician. You know, we did that mostly all remote. We did not send people out. We used Teams and how we integrated these, which was a challenge. You couldn't get your operators into the care centers because we were kind of trying to keep people out. You know, we lost some momentum there, had higher clinician turnover in those than we would like, which I think resulted in higher BD turnover. There was no clinicians to take patients, that impacted it. Those are things we're fixing now. I think that's just kind of a another byproduct of what happened to us in COVID. I think we're the one of the few doing a deal in the middle of it, but you know, it was the right time for us. Doing a deal in the middle of COVID. On the hospice M&A dynamics, I mean, you guys have been quite clear the last couple of quarters, your views on where multiples have gone. Yeah. I think frothy, elevated, ridiculous, right? Ridiculous. A few of the terms that's used. You know, do you think will this ultimately settle down and reset? I mean, obviously, we've got, you know, the significant disconnect here too, with now we're public, you know, multiples. Yeah. Have come back in. There's a lot more cooks in the kitchen than just the public companies, even though the public companies have been active. Do you think multiples on this just sort of stay this way, and this is the reality? Or do you think there is some convergence with some of the, you know, the multiple, mean reversion, let's call it, that's happened on the investor-owned, publicly traded? We still see very strong demand from our competitors to pay prices north of 20x. That's clearly not what we got into. It's very hard to make that work. What we see is a lot of private equity folks going for strong regionals and then holding their nose and saying, "Okay, we'll get a better deal elsewhere. We'll do de novos," things like that. We'll be able to spread that. I think in terms of just projected growth of hospice, it's one of the highest in healthcare, due to the fact the baby boomers are now coming through and they're in their mid-seventies. You're gonna see just incredible growth rates there. I think they're willing to do some of these deals, get a toehold, and then try to expand more efficiently and economically. It's a playbook that a lot of the big healthcare PE firms seem to be still drinking their own bathwater. I'd say I think where there's more confusion, which is obviously where we like to go, and more realistic valuations is in home health. Well, I did want to ask you just about sequestration. You know, I've been holding a view recently that, you know, some optimism that maybe it would get, you know, extended. Hear me out and just given the backdrop, right? The challenges the industry is facing, clearly Omicron just reconfirms that, you know, the environment we're in right now is not gonna suddenly go away January 1, 2022. Yeah. At the same time, the CR, you know, just got passed without relief on sequestration. I think that was probably one of the key vehicles ultimately to get this done- Right. Right. by the end of the year. Just interested from you guys, do you think that's sort of it, that it's coming back? Or is there, you know, is there any other shots on goal, I guess, in terms of getting this in something else? It should. We're down in Washington with the Congress folks, particularly those who are very well respected in healthcare. We find CMS a real labyrinth and don't get much done there. We've been working on that. I would. We're playing it very conservatively. Should they? Yeah. I mean, it's the outcry on this. I don't expect it to happen year-end. I don't really expect that. I think the outcry is gonna be so significant, particularly if this, you know, if Omicron turns into something real, they're gonna have to step in or there's gonna be significant shakeout. For us, both of those answers are good. We're prepared to go to next year. We've got a really hard budget, and we're gonna get through it. We got some significant growth opportunities. You know, either way, I think it turns out to be something that's beneficial for us 'cause we're prepared for nothing. You know, Scott will start dancing in the streets if all of a sudden we get it 'cause it just changes the whole game. Somebody's gonna take it back at some point. Right. Yeah, I mean that's, you know, that's a point. You know, it'll slow down any chance to do some more consolidations within the industry if they extend it, right? That's another lifeline. That's something out there. We get to, you know, frankly, from when we talk to people and look at our growth trajectories, you get it again, then we're gonna deal with the issue from 2022- 2023 that you're gonna be overcoming the loss of sequestration. It's, you know, it's great to have that. If I had my preference just to opportunities to consolidate and where we are positioned from a balance sheet perspective, let's just get back to normal and let's move on. When I say normal, I mean from reimbursement, sequestration goes back under there. Even though ultimately it could become like the doc fix, right, where Yeah, yeah. We come back every year and have to do it. That'd be great. All they're doing is Yeah. Your lips to God's ears on that one. They're just extending, I mean, the length of CR. Every time they do that, it's just they're extending the length of how long sequestration's in place. Right, and keeping it out there. it out there. Yeah. We think, you know, there's such significant opportunities when the entire pullback occurs, you know, with the CARES Act, with the fact that the CARES Act was money that was just given to people. You've got, they were able to delay payroll tax. They were able to borrow off their receivables. Then, you know, then sequestration was waived. So all these very small home health agencies with no access to real capital, then PDGM kicks in, all this stuff goes away. The labor market is harder for mom and pops. You know, there's been estimates, and I don't know if they're right, but between 20% and 30% of the industry could go under. We cover about 45% of it is within our catchment areas. That means we could buy these for free or cheap. That's exciting to us 'cause we won't want the license, and a lot of these places will just close down. We witnessed this a little before COVID came in, and right as PDGM changed, we saw some early people saying, "We're out." We think there will be a lot of that. I think consolidation is something CMS wants. The problem that they had with the initial RAP scores is you could have very fraudulent organizations taking that 60% upfront payment and then disappearing. I also think fragmentation doesn't do well for monitoring in Washington. I think they wanna start to see less and less. I think that's part of the reason why they put it in the way they did and restructured it in the way they did. That should drive consolidation. Well, I definitely want to get our special guest. Oh, of course. into the conversation as well. Before I do that, I don't wanna forget. I'm doing sort of a mini survey of one question of all the companies I wanna ask the exact same question to you guys about, and it's about obviously labor. The question is: As you look out with your crystal ball to 2022, do you expect that labor conditions for Amedisys will improve, deteriorate, or remain relatively the same? I would say, we'll have different answers. Well, you go first then. I'm confident, as I said, that there's still more juice in the orange. I mean, the way I look at it and the way I've always been looking at this business, and I think the way our whole team does, is we're fundamentally in the staffing business. We have to be really good at labor, and we have to have really good tools, and we have to be a differentiated place to work, and I think we've created that. I'm very confident that we have all these tools and tricks that we use, you know, using LPNs, which are easier to get and cheaper instead of RNs, PTAs for PTs. We're very heavily involved in Medalogix, so utilization management, we've gotten very good at. You know, there's scheduling is something that really could see a lot of advancement. We're doing some really cool work in scheduling. We're already, I think, the best at recruiting. Our recruiting yields are better than even the staffing. The AMN and the Cross Countrys are even better than that. The retention is the best in the industry. Is that an improvement for you, Paul? I think we will come out better than anybody. I don't know, I'd say neutral, but I'd say we will come out. If there is consolidation in the industry, I think we'll be in very good shape. Yeah. 'Cause we're a good brand out there for quality. I think when some of these shitty places go out of business, it'll be a really good place to pick up staff. Yeah. I think the labor cost is gonna still be a pressure next year. That's not gonna go away immediately. What we're confident in, as Paul's alluding to, is there's enough leverage. We're still hiring, so I mean, we're getting people in the door. I think there's enough leverage for us, we believe, between more utilization of telehealth, more focus on visits per episode, this LP and RN, PT, PTA, all those things out there. You know, better utilization of our PRN workforces, which are, you know, we have more capacity to get out of that. I think there's capacity management that we believe we can do to offset some of that pressure near term into 2022. Okay. I don't think that the top line from a labor, that's still gonna be a pressure point. Got it. All right, we're gonna shift to Contessa for a bit, but let me just pause here and see if there's any questions on anything we've talked about so far. [Sean]? Sure. Are you using much contract labor? Yes. Yeah, we are. More than we like. Yeah, probably about, I think 4.6. We got as high as almost 5% of our visits. That's how we kinda look at it, we're done by contract labor. Yeah, it's been high. It's something we really wanna pull back down. It's very expensive. It's not as good a quality. That's kinda why we wanna, and we're gonna be trying to adopt some technologies to use in order to help maximize that PRN workforce. We think we can use our people to replace those. Quick follow-up. With the recruitment effort that you spoke of, how do you see that contract labor mix kind of on settling down in 2022? Yeah, man, we'd like to see it get into certainly the low 4s. High 3s would be a good number for us. With the goal to certainly do better from an internal metric, but from a public perspective, that would be a win for us. I'd add to that also. We kind of realized that in certain ways, there's a certain segment of the nurse pool who are moving towards a gig economy approach. Scott mentioned PRNs. We have a lot of these folks that fundamentally are part-time, and we use them relatively and efficiently. We need to. That's why scheduling is so important for us. Because we can utilize that pool, we think much better and draw more people into the pool if that flexibility is in there at very reasonable rates. That's interesting to us. That's why we think there's a lot of potential. There are people in PRN pools tend to be people who want more flexibility. They still wanna work, but they wanna be able to work in a more flexible situation. We're doing a lot of research with these folks right now, just understanding what their needs are. We're trying to put together systems, which will continue to utilize them more heavily rather than going out to contract labor. Question at the back. Hey, Paul. Hey, man. We saw United buy Landmark, right? Yeah. After chronic care, you know, the sickest 10% of the population. Right. With Travis Messina, Contessa Health now and, you know, some of your hospital system partnerships, like, do you have the tools today to kind of treat those chronics with hospital at home in there? How quickly can that move? Because it kind of accelerates your business from, you know, what used to be a 5% volume and some price to, you know, going after and capturing this huge, huge, huge PNCM. Can you capture those patients today? Do you have contracts to do that today? Or how long will it take to. More of a chance of it now that we have Contessa because we can move up the acuity chain. Adam Boehler, who moved here now, after he founded and sold Landmark to United, and he's doing it all over again. He just bought US Medical Management, which is fundamentally a broken Landmark. It's got all the tools there, but it's kind of a dumpster fire right now. I think that'll come back, that concept. The concept was, we got involved with them in a variety of different ways, but the concept's pretty simple. High complex patients, pretty much close to pre-hospice, very early push into hospice. They were very early into hospice, had their own version of palliative. These were really people at the end of the line. We think that a lot of the stuff we saw at Landmark potentially in a different way could be thought of and utilized at Contessa. I mean, we do see Landmark where we're outbidding for things that are taking care of higher acuity patients. Can I come in? Go. Yeah, please. Yeah. Mainly through our palliative care programs, we have that same or similar capability as Landmark. Whereas Landmark's focusing on the top 10%, palliative is really geared towards that top 2.5%-3%. Depending upon the way in which you structure your contract, you can either have an engagement model where you get kind of, call it $400-$500 per engaged member per month, or you can get a full attribution model, which, you know, the economics are really attractive. Obviously, you have to appropriately manage those patients or members. We have those capabilities. We've announced two of those partnerships, one with Mount Sinai in New York, and then secondly, with the Henry Ford Health System in Detroit, which we'll be launching in 2022. Great. Well, I think that's a perfect segue into it. By the way, Paul, having covered Centene the whole time, they had U.S. Medical Management. A dumpster fire was an accurate. ...accurate summary of the financial contribution it had for them. All right. Great. Well, Travis, maybe we can bring it a bit high level first- Absolutely. It's for investors that aren't as familiar with Contessa, if you just wanna provide a you know introduction to the company. In particular, you know, if you could talk about what's distinctive about the model. You know, how do you differentiate in terms of driving value for customers? Absolutely. For those that aren't familiar with our business model at its highest level, we focus on patients or members that require institutional level care, most typically hospital level care. Think of a patient that meets the criteria to be admitted to a general medical bed on the floor of a hospital or to patients that meet the criteria to be discharged to skilled nursing facilities. We identify those patients through partnerships with health systems and render that same level of care in the patient's home over a 30- or 60-day episode of care. There's a number of complexities as it relates to the way in which the care is delivered. As I think of the differentiation first from the core capabilities of Amedisys, you know, we truly are focusing on those higher acuity members that again are typically generating a revenue per episode somewhere in the $8,000-$10,000 range on the hospital at home, and then a little north of $10,000 per episode on the SNF at home. We are heavily focused on Medicare Advantage. Before the pandemic, that was our primary source of revenue. Obviously, there's a waiver now that enables us to treat fee-for-service beneficiaries. I'd say in terms of differentiation from our competitors, there's three core components. The breadth of the capabilities of our clinical models. We treat hospital-level patients, excuse me, SNF-level patients, and then palliative-level patients. A lot of the other home-based models that you're seeing out there are really kind of point solutions for lack of a better description. They'll focus on urgent level care in the home or ED level care in the home, or solely hospital level care in the home. I'd say secondly, our reimbursement structure. All of our contracts with managed care organizations are in value-based arrangements. They're 30- or 60-day episodic cap arrangements. And all of the tools and skill sets that we've built to take on that risk, pay those claims, is something that's highly unique. Then lastly, I'd say we built a proprietary informatics platform that supports both the clinical delivery as well as the administration of the risk arrangements. Those are kind of the core components I would speak to. Great. The other thing I'd add to that, which is what I love, is because they're so efficient in delivering, because they get the protection of the DRG. First of all, hospitals, these are DRGs that hospitals don't like. You know, in my seven years at Tenet, there was stuff that we lost money on. They had to go. They didn't have any other place to go to the hospital. This is where the hospitals can actually make some money. The other thing is we can discount it also for the payers. There, instead of, they're paying less. Hospitals actually make money on it. We also use the hospital services. Then you go to the patients. The patients, given the choice, 90% of the time will go to the home. Then when you look at the statistics that are produced there, the readmission rates are what? 40% less, something like that. I'm sorry. Yeah. 44. 44. Okay, not to nitpick them. Anyway. I mean, when you look at that, what's not to like? And then you have satisfaction. I said the satisfaction rates are so good. The point is we found a little piece of the economy that's still well reimbursed, or Travis has. Then the other thing from a toolkit perspective, what attracted us, I think was, one, this ability to move into and double our TAM in an area where and be innovative, which is really interesting for us. 'Cause this is all. This is gonna make us a smarter, more innovative company, obviously at a huge macro level. Rubbing elbows with these guys and them rubbing elbows with us, we're gonna learn a lot from each other. We already have. The other thing is we think the world's moving to risk. This enables us to get there and to be enthusiastic about it and move it in fairly aggressively. No one else who's competing against us has these risk-based capabilities. Just doesn't exist. They're providers, good providers, but they're pure providers. You're gonna have to have that capability if you're gonna grow and thrive. Third thing is platform. As you take care of sicker patients, you need to build a platform so that, you know, you can get DME, you can get infusion, you can get all the care you need and have that on an individualized platform. You know, the development of that platform will create also a unique asset. Then that feeds back into the labor force and into the, you know, into supply chain and all that things. We think this puts us at some very unique capabilities, again, to take risk too. What we do really well, as I was saying before, we've gotten our operations in terms of quality so good that when Travis uses our folks, he can count on the results we're gonna deliver. That's why I think it's a really nice combination. Sorry. No. Want us to follow up just on the pricing model too, because I think the market in terms of would very much broadly agree with the thesis and that we're shifting to risk, value-based care is accelerating. I think there's broad-based buy-in that that's the trend for the future. More short term, I think there is some sensitivity clearly right now around, you know, MA-levered businesses ultimately in terms of if there could ultimately be some changes to risk adjustment or risk scores, and that's clearly an area, you know, that there's a lot of scrutiny. Maybe can you address that, talk to, you know, sort of underneath your contract structures with the MA plans. You know, is there a tie-in to risk adjustment and, you know, ultimately, you know, your thoughts on, you know, the discussions that are occurring in D.C., you know, around making some potential changes to the model. Absolutely. I'll speak to the hospital and SNF at home components first. There is for all intents and purposes no tie to risk adjustment in the hospital and SNF at home. It's anchored to the DRG or the historical spend encountered by the member for the condition for which they're being treated. For example, in hospital at home, if you have a pneumonia patient, we're partnered with the Ascension system here in town. We get claims data from the health plans with which we contract. We look at not only the DRG spend, but all the related spend for that member over a 30-day period of time. DME, infusion, pro fees, all ancillary spend like SNFs, as well as readmission spend. And then we discount off of that historical baseline. One of the protective mechanisms is the fact that we are tied to the DRG of the health system, and often there's escalators in their contracts. There's some protective mechanisms there. As it relates to the palliative care and the polychronic type contracts, there absolutely is risk adjustment factors. Typically for those members, you've had very poor risk adjustment or coding for those members because you know, they've been ignored by the healthcare system. Capturing those allows you to increase your premium revenue, and have more attractive economics. Okay. Is that helpful? Yes, absolutely. Another question, just talking about the long-term growth trajectory. The Amedisys team has been generous enough to provide the street with some long-term- Sure. you know, visibility into anticipated growth, which is quite robust. I think it's got 100% plus CAGR right through. Obviously, off a relatively small base right now. Yep. Over the next four or five years. Travis, you know, love to get, you know, sort of your, I'm sure you concur with what they've said, right? Absolutely. You know, some- Of course. -some of- You're sitting next to him. sitting next to him. He's sitting next to Scott. That's right. He sold it to us. Absolutely. With this, Paul. Ronald. I mean, I think there's a couple things that you have to look at and that give us a tremendous amount of confidence in our ability to hit those projections. First and foremost, the nascent stage of the business of hospital- and SNF-level care at home when Contessa started, I think there were probably five health systems in America doing it, and three of them were our partners. With the waiver, there are now around 75 health systems signed up. Not all are operational, and a significant portion of those are our partners. The way in which you can achieve those projections is, you know, kind of twofold. First and foremost, new partnerships. We announced, I believe, that we're gonna target five new partnerships or new markets in 2022. Tremendous amount of confidence in the ability to hit that first top-line number. Once you're in a new market, let's take Henry Ford, for example, our recent announcement. There's multiple hospitals that we will launch. We're gonna launch at one, but over typically a two-year period, we add additional admitting sites, and so that increases our volume potential. In conjunction with that, you know, we were the first company to receive reimbursement from a managed care organization for this service. Like, we created it. You have the ability to add more payers. You have the ability to add more care models. Ultimately, because it's a new model, you have the ability to drive better adoption with the clinicians rendering the care. You have multiple levers that you can pull in order to drive growth. In addition to the levers, second thing, you know, Scott mentioned this, there are some acquisition opportunities that are incorporated into those projections. Lastly, for the palliative program, the economics can be quite robust when you're starting to take control, for lack of a better description, of the spend of polychronic members where they could be spending upwards of $2,000 per member per month in those last stages of life. When you're managing and you have an attribution type model, that's how you generate those types of economics. Understood. That's where we cross with the Landmark- Exactly. for the palliative piece. Sorry. Very chunky MA revenues for sure. Yep. Get it how quickly you can scale up the revenues. If we sort of think about that projection and that you can scale this to half a billion-dollar business right over the next four years or so. Yeah. How do you sort of see the margin ramp, you know, sort of, play out over that period? Obviously, this is an investment period for the business. Definitely. If you could scale to that type of revenue yield, you know, what do you think is a sustainable margin? At Contessa, we focused really. You know, we put a tremendous amount of our efforts into focusing on two things. Obviously, I should say quality first, obviously. Then after that, engagement of members and then unit economics. Almost, you know, we're almost punished for it as a, as a venture type company 'cause we were focused on that so intensely, you know, oftentimes at the expense of top-line growth. In some of our partnerships, we've already achieved year-to-date margins on the EBITDA level on the JV of around 19%. They're nowhere near scale. We think we can add a few more points to those, JVs, again, at the, at the JV level. At Contessa, from a contribution perspective, we're in the high teens%, which, you know, can provide quite a bit of contribution to Amedisys corporate at those levels. To speak about the penetration piece, just talk about some of the people that are in, and then what the capacity is. You know, like Ascension, you mentioned Ascension Saint Thomas. Ascension, I don't know how many hospitals they have, but it's going really well at Saint Thomas. Ascension wants to spread it out through their system. That's, you know, Dignity. You know. CommonSpirit. CommonSpirit. Mm-hmm. It's huge. The idea is that you, once you're in and you perform, you can move through the system very well. Yeah. In conjunction with that, I mean, we spent a lot of effort on getting managed care contracts with the national payers, and so we have several of those at a Contessa level. We can apply those to affiliated entities, one of the reasons for the joint venture structure, so that we can have more speed to market. Scott, when we think long term, and obviously, I'm sure there's gonna be continuous investment in the business, right, over the next several years. When we think about the natural economic profile, it sounds like longer term, that it should be neutral to additive to Amedisys' overall consolidated margin profile looking at longer term. Oh, yeah, absolutely. Yeah. I mean, that's, you know, right now, barely, I think we said break even kind of in that year three timeline. You know, if top line really The only reason it would slow down is because top line just took off and we're putting on deals faster than we anticipated, which would be a good thing. I would expect we're gonna be on track, and I think some things will probably develop for us that may make us more opportunistic to reach that earlier. As of right now, I think that's a good goal. Great. Well, we're pretty much out of time, but I did just wanna check if there was one last question out there.