Good morning, everyone, and welcome to our second day of the Bank of America Home Care Conference. My name is Joanna Gajuk. I'm the Equity Research Analyst at Bank of America, and I cover home health and other home care companies. Thanks for joining us for this for this day today. Together with Kevin Fischbeck, Andy Bressler, Travis Steed, and Julien Ouaddour, it's my pleasure to to host this event virtual this year. We hope you enjoyed the conversations yesterday and we have a lineup also for today, couple of panels and Q&A sessions with companies. We're gonna start today with Amedisys, one of the largest home health and hospice providers in the U.S. Today with us, we have Paul Kusserow, Chairman and CEO, also Scott Ginn, CFO and acting COO, and Nick Muscato, who's the Chief Strategy Officer. Also, I want to make a note to the audience that if you would like me to ask a question on your behalf, please use the Ask Question window that's next to the webcast panel to send your questions, and I'll be more than happy to send it the way of the team here. We're gonna go right into Q&A. I guess, Paul, welcome back in your seat. Good to have you back as CEO. Maybe first, you know, we could hear Paul speak about just, you know, any changes in strategy or operations, or anything you wanna flash out in terms of, you know, as you come back to be CEO. Great. Well, I appreciate it. First of all, thank you, Joanna, and I want to welcome everybody, although you can't see the ambiance we have here. We're in the Virgin Hotel, right down from our offices, and we're transmitting from the Shag Room. We're very excited to be here. It's an unusual place. To answer your question, Joanna, the strategy that we've put together and believe in, is very much intact. We think that... I think one of the things that we saw, particularly over the past year, was an acceleration of some of the market dynamics changing. We believe that actually we have been quite prescient in preparing for what the market is today. Scott and Nick and I have been working on not so much changing the strategy, but where we're gonna emphasize the strategy, to make sure that we implement against the strategy and where we're gonna track on the strategy so that we see some progress. The key thing in our business is to understand which are the most important levers to pull that's gonna drive our business, particularly as the environment is changing, and to make sure that we're ahead of the puck or at least where the puck's gonna go. The areas that we're focused on and we'll be talking about, reporting out, and making progress on, first is the labor. The labor markets have gotten tighter. This is something that's industry-wide. It's not a Amedisys problem. We view it as an opportunity because we're particularly good in this area. There's some. We've gone through, and I think more than anybody, we've spent a lot of time understanding our workforce, understanding the nursing workforce, understanding our caregivers, what they, what they need and what they do. We're focused very much on making sure that we are the best out there. As you know, we've gotten all these awards for being a great place to work. We're gonna continue to drive that. There's some things that we see, near-term levers that we can improve on. And you know, the key to this business is we're, you know, 540 care centers in close to 40 states. It's a healthcare services provider business, highly decentralized. What we need to make sure is there's some continuity around a couple strategic things. As I said, first is labor. That's driven by turnover. We have to make sure that our turnover, it stays at the lowest in the industry. As we've seen and as Nick has done a lot of work on, when we have a stable workforce, what we see is we have higher productivity, we have better outcomes, and we have better margin and EBITDA. We are a staffing company ultimately when we break everything down. If we have great staff, we have a great company. If we have great staff that have been here for a long period of time and are delivering consistent results, then we produce very strong economic as well as quality results. The markets, because they're regional and local, know this and they refer to us. The thing which also is important here is the paradigm shifting due to this. I think it's gonna be interesting, and we're starting to see two paradigm shifts. First is that we're moving from a I'd say a market where we were often commoditized, particularly when it was in relation to managed care. They utilized, they bid us up against each other. They put all these, you know, they drove the pricing down. We're now seeing a market where we're doing some work with McKinsey, and they'd done some interviews in hospitals, and they saw that there's 15% less take-up, inability to be able to send people in the home, that from the discharges. What that's gonna do is it's gonna drive demand up, we're gonna move from a commoditized market to one that is capacity constrained. We need to take advantage of that dynamic, and what we need to do is, one, make sure we have that capacity, make sure we have those people. Two, we need to make sure, which is our second strategic initiative, we need to make sure that we're deploying them to the right places where they can deliver the best care. We need to make sure that if fee-for-service is flat or slightly declining, one, we need to make sure we continue to steal share so that we do get fee-for-service. We know where the world's going. It's going towards Medicare Advantage at about a 7:1 ratio with new sign-ups. We understand that. What we then need to do is because the issue is capacity, we're now going out to the managed care folks who understand this and saying, "Okay, you're gonna need home health as services. You love it. You've told..." You know, how many payers have said, "Oh, this is where the world's going"? Yes, the world is going there, but you won't have the people to take care of your members unless you start to strike deals with us. Those deals are fundamentally allowing us to manage that care at risk, but managing that care particularly around utilization, case management. Those are the conversations that we're having with payers. Also, we need to get conveners to the table since, as you know, a lot of the conveners out there are deploying different techniques. There's fundamentally four major conveners. What we need to do is make sure that those conveners understand that they need to migrate to not just a delegated risk entity, meaning we'll just beat the heck out of you so that we can get margin, and then we'll drive down utilization and delay care. We've had conversations with all of these conveners. We think there'll be... In order for these folks to survive, we think there will be a migration, we think they're all capable of it, to being more partners, partner-oriented, helping drive more capacity into the system versus some of the techniques that have been deployed in the past of, you know, classic utilization, classic delegated risk management. We think that's where the world's changing. What we're working on now is, you know, there's a sluice that comes out of the other providers that, for largely through physicians and through hospitals. That sluice, you know, right now we take everything that comes down the sluice. At some point when we're capacity constrained and if we have Medicare Advantage business that's per visit and it's not a good contract and we're getting delayed in payments, we're gonna have to make some tough calls on if this is something we should take. At the same time, we're gonna have to balance that with making sure that, you know, we're, we respond well to the providers that are sending business our way and not cherry-picking. It's a very delicate balance. We're going back to the payers and we're having conversations and saying, "This is where the world's going. We're the highest quality. We can deliver. We'll take risk on a variety of different things. We'd like to be doing this with you, but if we can't really continue along these paths, if you wanna play the old game." Most of the sophisticated ones are understanding it. I think there will be some standdowns probably regionally with some of the payers out there. I think it's time. I think the industry should start to do that, particularly since there's increasing constraints on capacity. The payers, I think, that don't do this will start to see less business taken up by the home health agencies. I think their costs will start to go higher because they'll then have no place to place their patients. They'll have to go into institutional settings. That's two. One, labor. Two, mix, making sure we optimize our mix. Three, we call this clinical optimization, which is fundamentally a centralization process. I'm gonna let Scott talk about that because that's what he's gonna be driving. The key here for that centralization process is we get two things. One is we get to save lots of costs by consolidating administrative functions that could be done more efficiently in a centralized environment. Two, we take things off the plate of those 540 care centers that have way too many things to do, and we start to focus it on just doing a couple things really, really well, and that is taking care of patients, retaining people, and bringing in the right mix of business. Yeah, I think, you know, that's the goal here. I mean, I think it's what we've talked about when we, you know, as we talked about the shift to MA. Certainly, we're gonna work as hard as we can and feel good that we're gonna get some better contracts out there, and we continue to show that. With that being said, we're still gonna have to shift the impact of gross margin down to EBITDA margin, and that's gonna be through G&A, and this is kind of our first efforts around it. It's simplifying what's going on in the care centers, where that is about the patient, the quality of care, and our clinicians. Then everything else is gonna be outside of that. Certainly I think we think that's gonna increase the focus and give us ability. If you think about us being able to do deals going forward, it's gonna change the economics around that as well. I think it's an exciting time. We're gonna touch a lot of different things. We're trying to be very careful that it's not disruptive to the business. We've got some great starts to that. We've indicated some of that in our previous call, and we'll continue to give more data and clarity around what we're doing. It's gonna be an ongoing effort through 2023. You know, we'll do some pilots in some areas that are more sensitive. We think it's really, it's time. I think automation's gotta come in play as well within the industry as well as Amedisys. We feel very good about what we'll be able to achieve throughout 2023. Yeah, that's one of the exciting things. I'd say, that's initiative number three. The fourth one is Contessa, proving out Contessa. We've gotten some incredibly good clients in, we're, since I've been gone and now I'm back, we've got some very good wins in terms of, you know, again, extremely strong clients. There's a lot of depth in what we can do there. The question I think now is digging in deep with these folks, implementing, making sure that everybody in the industry knows that this is that this is a very good model. The one thing that you hear about everywhere you go is Hospital in the Home is something that's highly attractive to people. The model that we have put together is attractive to both providers, payers and patients. It checks the box on all three areas. We're getting, you know, we have people that are very interested in continuing to meet and sign us up. I think the key is now to be selective about who we're bringing in and then go deep and start to really show what happens when we can really bring everything into bear there. We have some small SNF initiatives that, again, we wanna show how that works. That's important. We have some palliative programs that, you know, we have going in three places. We have some significant conversations on palliative in other places. Our hope is that we can bring in some of these pieces of business in the next couple months. That's very excited on that. I know there's been some pressure on wins and on losses at Contessa. We're very sanguine on the business. We think it's transformative. It completely distinguishes us from any other players out there. Again, we're the only real people there who look to take risk, who will stand by. Again, being an ex-payer, you know, being at Humana, we understand what it is to take risk. We understand what you need to take risk. The great thing Contessa brings to the table is the actuarial underwriting reinsurance capabilities that if you're really gonna take risk, you need. That's, again, that's where we're excited. The plans are excited about it, that we're talking with. We gotta take the excited people and the very cool chassis, bring them together and start to sell some business. I'd say the last one is predictability of earnings. We haven't hit been predictable on the earnings. That's, that's the reason I'm back. We need to stand by what we say and deliver on what we deliver on our numbers. There's no reason with these initiatives that we should not deliver on our numbers and beat our numbers. And it is. Yeah. Are there challenges short-term? Absolutely. Are there headwinds short-term? Absolutely. As a company, we've always been the ones to turn headwinds into opportunities and to distinguish ourselves by doing that. We're gonna continue to do that. Great. Thank you. Thanks, Paul. That was a lot. That was a long monologue. I hope that worked. Yeah. You know, that was great, 'cause it was very detailed, and you hit on all the topics. Yeah, like you mentioned, labor is number one priority, right, for all the healthcare providers really, given what's been going on. I guess the kind of the sentiment seems to be that, you know, the market, the labor market is improving, but it's slower than expected. Maybe you can talk about, you know, maybe some specifics in terms of what the company is doing maybe differently. You know, what's working, what's not. In terms of also the outlook into next year, how you think about the improvement. Do you see some significant improvement next year? Also with that, you know, specifically around wages, do you expect the kind of the wage inflation to, you know, kind of decelerate from the 2022, you know, wage increases and kind of where do you think it's gonna land over the next couple of years? Yeah. I'll say a very odd thing, which isn't unusual. I will say that Recession will be good for us. If you look at some of the data that's out there on nursing in particular, as we still know, a lot of nurses are still you know, nursing is largely a profession dominated by women. A lot of these are dual income. When recession hits, often they come back to the workforce. Often these are people that move in and out of the workforce. Recession tends to bring people back into the workforce. What I've seen in my past lives, and We haven't really seen it here at Amedisys because we haven't been in one, but we see people returning to the workforce. I anticipate that's gonna be the case, if we do hit a full-blown recession. I think that, and I'm told it's here, some people say it's here, some people say it's coming, but I think that will benefit us as people, look to come back into the workforce. The other thing is there's 6 million nurses out there. There's an opportunity for us, you know, to get our share. We don't need all 6 million, obviously. They're, they're out there in a variety of different ways, and when you look at what nurses want, in particular, PTs aren't as much of a problem bringing them in. If you look at what nurses want, one, they want flexibility in their scheduling. Two, they want a very good leader, and as I talked about, we're highly decentralized. We work out of care centers. Often the leaders that work in these care centers are nurses that generally the best nurses that got promoted, they're not professional managers. We have to start to build that. Most of them actually turn out to be really good managers. We do need to start to build some training and again, make sure that at the top of their list, regardless of anything they do, retention is the key thing. It's very interesting to go into a care center where you do see turnover, and you see what that does to the entire stress of the infrastructure of that care center. It really starts a very hard decline that's very hard to reverse. From our perspective, the number one thing our DOs, Director of Operations, should be focused on is retention. If we see problems there, we need to be all over it with incredible alacrity. That's gonna be something new we're gonna be focusing on. That will be the driver. The nurse we can... Again, due to the natural growth that's there in home health and hospice, it's not a question of is there demand, it's a question of is there supply. You know, we believe pay is important. When you constantly look at the surveys and some of the work we've done on our own, pay is about fourth on the list. It's only fourth if it is are you paying me fairly, market rates, which we do. We pay actually a little better than that. Are you paying me fairly, and do I have good benefits with that? If you're in the game, and if these are folks that are in your industry, you will attract these people. The other things are, you know, one, do I have a really good manager? Two, do I have flexibility in my scheduling? Then three, am I part of a team? Those cultural issues are so important as well as flexibility. Because remember, this is, you know, the more flexible we are, the more nurses that do have special situations will then come to work with us. Schedule flexibility is what we're gonna be working on as well. Nick made a really nice investment in a company that we're working with currently that does fundamentally flexible nursing. Those people that have done it have alleviated the pressure of recruitment because frankly, We are much different than a hospital in the fact that we have the ability to be flexible. Our patients, frankly, can be flexible, more flexible. We could go see a patient at 7:00 P.M. at night. We could go see one on Saturday or Friday afternoon. We have to make sure that that's part of our culture, that is we help the patients. We go to where the patients are, and that we also the paradigm, as I said, is gonna shift due to the fact that capacity is constrained. The employees are gonna now start to dictate more what they want and what they're willing to do. We have to be aligned with that and be willing to satisfy those needs. If we do that, we will have lots of nurses. Before it was, you know, for most of the history of nursing, it was, you know, hospital, show up to your 12-hour shift three days a week, and then, that's it. That paradigm is changing. Oh, I didn't answer inflation. I'm gonna let you do that. Yeah, no. Thanks. No, you know, it's still, you're right. I mean, I would say it's improving. Things are improving slowly. I mean, I think we've done a good job with the employees we have when you think about our normal cycle of raises, when we're able to keep people, keep them motivated and just in our normal cycles, things go well. We're kind of predictable there. When our rates of turnover are high and we're having to rapidly replace people in the field, that's when it becomes problematic and you see costs. That's really what's driven kind of off-cycle issues out there. We think we've addressed a lot of those, but I think it's still gonna be a challenge in 2023 until there's enough volume of heads within the organization, where we're not seeing the same rate of turnover, and get some stability there. It's still gonna be something that's gonna be challenging for us. You know, we were able to offset that during 2022 a fair amount. If you look at, you know, as we've switched to this cost per episode view, as you look to our ability to take down, and we still saw declines in visits per episode, you know, that'll be muted next year. I think we're kind of at a stable point there that'll move slightly based on some things and normal seasonality around what's happening with PTO, weather issues, or whatever else is out there. I think inflation is still something we'll have to manage through. We really wanna focus on contractors. I mean, that's the other lever. We probably spend close to $40 million a year on contractors. That'll never go to zero, if we get the hiring stages right, that'll be a great way to off-cycle that or offset that. You know, as you're having to turn over and replace staffing, there's a cost to that. The productivity is not there. A lot of that is in our control, but some of the other market pressures I don't think alleviate for a little bit now and maybe the second half of next year. I still think the first half's gonna be, we're gonna still see some of those higher rates. You mentioned, you know, the hiring trends and you need to increase the number of staff into next year. I guess on the third quarter call you mentioned some slowdown in new candidates, right? I don't know whether this was seasonality. Can you talk about what your explanation or what you think that was happening in third quarter and also what are you seeing in fourth quarter so far in terms of, you know, net hiring? I guess to that end, you know, with the reasons why the slowdown or maybe things are getting slow, are you seeing increased competition from other settings outside of home health? Is that what driving the kind of the difficulty in hiring here? I mean, I think there was probably some seasonality in Q3, but, you know, I would point to it as we transition, we just brought on a new head of HR, a CHRO. We brought in a new lead in talent acquisition. You know, so I think we lost something in that transition that certainly didn't help us, and we missed the mark around our hiring. You know, if I was to, you know, just a preview on the start in October, then, you know, we're filing the numbers here in November. October, we saw much, much improvement from where we did in Q3. Actually net positive there. We're seeing good candidate flow, but it's still, you know, we got to increase the number of candidates per application or per opening. That's our what we're working on right now. I feel good about kind of the changes within the talent acquisition department. We're seeing some productivity. Really, you know, we had targeted, there's about 14 care centers that we considered high growth care centers, where we're seeing from a fee-for-service perspective, and we needed staffing. It really we took a nice turn here recently in the past probably five weeks around that, where we've actually, if you were to go chart that, a steady decline in all 14 of those care centers from June forward. Actually we're ahead of our June numbers right now in those care centers. That's early indications. That's certainly when we focused on 14. We've got to broaden that. It can't just be we hit the marks on just 14 that we're focused on. We've got to be broader and hit the marks across the board. Staffing is gonna be something that really is gonna be my focus. It's, you know, challenge our operators that, you know, your focus has got to be retention. You know, stop some of this turnover out there, and really challenge our HR leads to make sure that we're getting the heads in the door as needed. It's gonna be an effort on both sides to solve this problem, but I'm optimistic that we're gonna get there. I think the other thing, Joanne, is, you know, to follow-up on what Scott was saying. We don't have a recruitment problem if we have no turnover. I mean, is that gonna be... You know, we want a certain amount of turnover because, you know, some people just don't work out. I think the idea is, it can become a vicious cycle if your turnover is accelerating at a rate, and particularly again, in a constrained environment. That's gonna be something that we're, you know, that'll alleviate some of that recruiting pressure that's out there. The other thing we have is, and this has always been the case, is the wobble in the fly in this ointment is always hospitals. They have such a herky-jerky way of going after nurses and, you know, all of a sudden they'll lay them all off, as we saw in the pandemic, and then they'll start hiring everybody and then throwing incredible packages at people. I'd say that sometimes these, they put on huge blitzes and they're very inconsistent about things. What we wanna do is be a consistent employer. It's angered a lot of people, I think a lot due to the decline in the hospital industry as we're seeing, you know, slow, but it's definitely occurring, into more outpatient and ambulatory settings. We're starting to see that, you know, they're really trying to fluctuate and having a hard time settling on what their staff really needs to be. Sometimes we feel the effects of that. Right. I would, you know, and Paul talked about a little bit about flexibility. That's kind of what we learned from when we came out of, you know, Q3 of last year, I think it's, you know, we saw a big increase in the amount of sign-on bonuses, retention bonuses that we put out there in the market. What we saw is there was still a heavy amount of turnover in that group. It kind of makes you pause and say, really, was that the driving force? I think we've gotten much more selective market-wise in where we're putting sign-on retention and the team has helped us kind of find those markets where we really need to have to do that. That was something that we experimented with. We still do it, but the pacing of that has changed. It, it really, when you look back and say, really, is money the driving force? During that same period, what we also saw is we were seeing total hires come in and at a strong pace, but we were having conversions for people going down from full-time to part-time to PRN. We were gaining heads but losing capacity because we had that shift, which points to us when you think, step back, look, if we're unable to provide the flexibility they want, they have the ability to go out and provide their own flexibility by doing that. They could work for multiple companies and adjust their schedules. That's something that we have yet to solve. I think that's, we know today, is top of mind with a clinician. That's, we think that we're gonna have a lot of energy on that. The investment in connectRN is something that we've got to really push on that as a technology solution to help us find that flexibility within our workforce. Yeah. I think there's been some good innovation around us on the idea of staffing. You know, we'll learn from our friends out there. It's something clearly we're gonna be taking some very innovative and serious steps towards. If we win at that game, you know, and you know, looking at all the varieties, making the investments we've made, you know, looking at other investments and partnerships that are out there's been some good innovation out there, and it's not. If you look at other industries too, they really understand how to bring people in, deploy them. We need to expand our thinking, and the good thing is, the bar is so low that I think we can elevate it pretty quickly. I guess, in terms of trying to put some numbers around this effort around, you know, lowering turnover and bringing, you know, new hires to your point, you know, if you keep the turnover, you know, under wraps, so to speak, then, yeah, you don't need to hire. When we're thinking about the ultimate goal, right? 'Cause you need the staff in order to grow volumes, right? How should we think about what's the magnitude of things here in terms of what's, what% I guess, of increase in staff do you need in order for you to grow volumes? I think it's two things. One is there's, you know, Again, I think there's infinite demand. I mean, if you look at the growth rates of our industry, you know, you look at what home health projected to grow at, you know, easily 6%+. You look at hospice, I've seen some projections that it's expected to double in the next 10 years, that demand for that. I think the demand is infinite, frankly. The people that are in this industry, and I think a lot of that's payer-driven, I think they understand finally that home is the place where people wanna be, particularly again, with the onset of the incredible domination of chronic illness, does not demand institutionalization, it demands care in the home for a lot of it. I think it's really quite extraordinarily strong demand. I think the game will be won on who has the staff and then the deployment of the staff in the most efficient way. I think, you know, we are very good at utilization management. Right now, the payers want conveners. Some payers want some conveners to do that for us. I think we have an innovative approach, which is a case management system where we drive our own utilization and then redeploy that capacity back to those people, and thus what we do is then we can expand that capacity. Those are the conversations we're starting to have with payers out there in particular. You know, we need a good case rate. If, you know, we aren't gonna do it on a per visit basis, we'll do it on a case rate basis, and then we can redeploy, you know, 25%, 30% of what we can drive down. Maybe it's not that high, but of what we can drive down and redeploy that into that capacity that they're getting currently denied on that they're gonna need. Those are the conversations. A lot of it is utilization management. I think we're good at it. We can always get better. A lot of it's mix, as you know. I mean, we've gone through the RN, LPN methodologies. I do think we have to be a better employer of LPNs. This is a group of people who have very specific needs and are generally not treated particularly well in the industry. I think we could do better there. You know, utilizing that mix, utilizing PTs when we can use them, they were easier to get. You know, also under a managed care scenario where it's fully capitated, utilizing personal care in certain cases, if we're doing full capitation. Has yet to get there, though. Right. Actually on those last points around the Medicare Advantage plans, right? You as part of your strategy, you clearly focused on that. You have these new contracts with that. I guess also when the discussion was on the third quarter call around next year, right? The, this kind of, I guess call it bridge into next year, assume like a $20 million from MA contract improvements. Can you talk about what gives you confidence in this ability to make such a meaningful improvement? 'Cause that sounds like a, you know, like a pretty sizable move in these contracts. Yes. We outlined, I mean, so certainly expanding the contracts we have, getting better rates will be a combination of that. Certainly, you know, as we anticipate closing another one hopefully soon, that certainly gives us a bridge to that. You can think about the magnitude of every $1 increase in a, you know, in per visit, how that drops straight to the bottom line. You can get there pretty quickly doing that math, but we're gonna need to get the contracts. I mean, the bigger payers that we talk about cover about 70% of our business. It makes the decisioning around those other 30% much easier as you go forward. I think we'll be able to be much selective. My goal would be to have, you know, fill it up where we have the better contracts out there, where we're leaving some of the, you know, the tough struggle at the care center level is, you know, if you got all this volume coming in, you know, as you manage your capacity, if you limit the number of contracts out there, you make those decisions easier for them where they're not having the burden of trying to manage that capacity so perfectly. It's something we have to really take some ground on in 2023 around MA, and we just have to get some really the larger payers, we need to get that behind us, so we can be more decisive. Well, I mean, one of the good things, I think one of, you know, one of the positives that occurred when I came back was, I got calls from all the payers, being an ex-payer, you know, saying they want to sit and talk and can we get together and talk about how to work together and how we can reimagine working with them on a home health basis. I think there will be opportunities. That's where I frankly plan on spending most of my time. I'm gonna be spending my time on this new MA book and trying to make sure we move towards that, making sure that, when we do this, we align well and have good contracts that are good for both. I think we'll be taking harder stands on the per visit stuff where it's just, you know, again, being capacity constrained, it doesn't make sense for us. And then the other piece I'll be spending a lot of time on is, again, Contessa, making sure that we bring in some of the palliative deals and that we continue to really show tremendous success on the hospital home. Again, that'll create a lot of differentiation for us and then hopefully it'll start to drive down some of the you know, some of the early anticipated EBITDA losses that we've got. Yeah, on this new contract, right, that you signed with CVS-Aetna, the, you know, the kind of explanation for how these contracts will ramp up into next year was around, you know, improving gross margins. I think there's part of it is like the quality bonus payments and whatnot you're gonna receive, but I think also there was a commentary around over time reducing the number of visits per episode. Can you explain to us, you know, how that's gonna be achieved and kind of where do you find the balance? Because obviously you don't wanna cut the visits per episode too much, right? Because you're gonna lose the outcome and the, and the, you know, the quality outcomes here. Can you frame for us how should we expect this contract improvement progressing through the year, and what are the main drivers? Nick, you know the contracts. Yeah. Yeah, sure, Joanne. The doing our own internal utilization management is really where the gross margin improvement comes from within these contracts, right? If you think about under a historical per visit arrangement where we're just paid per visit, you know, we never layered in the cost of, you know, Medalogix Care and Medalogix Pulse, right? Which is the product that we use that creates, you know, a truly patient-specific care plan. When we're talking about, you know, being reimbursed on a case rate basis, you know, we're now incentivized to appropriately manage that utilization to make sure that our patients are achieving the best outcomes, but also that we're doing it in the, in the most efficient way. You know, historically per case in a per visit arrangement, we would do about 22 visits, 21.5 visits per admission. When you think about layering on, you know, Medalogix Care and Medalogix Pulse, you know, that number can probably drop to 17.5. Like you've seen within our episodic business, we fully expect that our quality scores will improve as we do that. That one allows us to free up capacity, and as Paul and Scott both said, we'll deploy that capacity back to that payer. It also then, you know, allows for that gross margin to improve. The real interesting part about these case rate deals is it's a win for the plan. The plan gets a discount to what they've historically paid us. They also get a capacity guarantee and quality guarantees. You know, we have incentive to appropriately utilize utilization management ourself, and make sure that we're delivering on all the quality scores for our patients, and then the patients are receiving, you know, kind of the best care that's out there. It's a win for all parties involved. That's kind of that piece is how, you know, you grow gross margin in those contracts. Yeah. Joanne, just the things that keying around there is we talk about you just gotta, you know, between Medicare fee for service or episodic business, we're talking visits per episode. When you go down to these type of deals, you're talking about visits per admission, which means you're impacting, you know, the visits over a normal kind of time period plus what would be a recertification. Just know there's a little bit of shift there in how you think about that. Using that Medalogix data to impact both the visits as well as, you know, who gets recertifications. It's similar, I mean, it's what we do in our book of business around Medicare today. It's applying that Medalogix tool where you may have some patients that, you know, you're gonna do more visits than maybe you're doing today when you really use the data. And then there's some that, you know, certainly would need less. You know, we've looked at that data, and that's why we're comfortable that we'll be able to drive how we do from a visits per admission perspective over time. It's why we invested in Medalogix. No, exactly. Makes sense. Just very last one, I know we're running out of time, but the other big piece into next year is obviously the Medicare rate update. Obviously came in better than the proposal, but still not really where the industry wants the rates to be. I guess when it comes to your bridge into 2023, what does it do to your bridge? You know, having these rates now finalized versus when, you know, we last spoke on third quarter call when you were talking about the bridge. Well, basically, you know, now, I mean, we really didn't give any color on that. Everybody knew what the potential outcome for that. Basically, you're, you know, basically I would say flattish pricing as you move forward. Actually, you're gonna be on the home health side, relatively negative because you still have to come over sequestration next year. You know, so it's kind of was in our outcomes. At that point we didn't know it, so we really didn't put anything on it. Basically, you know, that's gonna mean that the wage inflation becomes more of an issue. You're not covering that. Fortunately, on the hospice side, we're getting a nice rate update, so that'll help it. You know, you do get some flexibility because we're in a per visit model. Certainly, you know, it's a rate cut, they just split it in half. It's something we have to manage through here in a tight labor market. We're fighting it, obviously. We're, you know, again, I'll be spending a lot of my time up in Washington with our colleagues to make sure that we do our best. It's a, it's a, it's a. It's now become a classic move of CMS to scare everybody, come out with huge cuts. We then spend time, effort, and lots of shoe leather up in Washington. CMS backs off a little, gives us a middling cut, and then, you know, they kinda get half of what they want, but then they push it off into next year. We wanna stop that cycle. That's what we're going to be working on this year, which is to, you know, they've, they kinda get away with it, and we wanna make sure that the ardor and the passion is still there to stop this. It's the fundamentally what this was, it was still a cut. Let's face it, 0.7% was still a cut. With the labor inflation, you add that in. Was it as drastic as it could have been? No. I think in you know, big players like ourselves, would a full cut might have been better? Probably. It would have opened up a lot of MA, it would have brought the acuity of the situation to the attention of legislators. It's a kind of a middling approach, and we're making Washington aware of that. All right. I guess we shall hear from Congress hopefully soon around the omnibus bill. This is all the time we have for this discussion. Thank you, gentlemen. Thanks, thanks, Paul. You know, nice to see you back in that seat. Thanks, Joanna. Thanks, everyone for joining us for the conference, and hope you enjoy the rest of the day. Thanks so much, Joanna. We really appreciate the invite. Yeah. Thanks, everybody, for listening. Thank you. Take care.