for joining us. I'm Sarah James, a healthcare technology analyst here at Cantor, and we're very excited to have here with us DocGo, one of our Overweight rated stocks, and their CEO, Lee Bienstock. So DocGo is really an innovator in last mile issues, whether it's medical transportation for payers, providers, and government agencies, and mobile health segment, which facilitates health treatments at home. And we're incredibly encouraged about some of the growth going on at DocGo lately and refocusing on the core business. So thank you so much for joining us. Thank you, Sarah, and, it's great to be here with you. I know you know the company very well. It's always great to get your input and have a conversation, so great to be here. Perfect. You know, so for those in the audience that are a little bit new to the name, can you give us an overview of the business? What is your mix between the segments, and how do you see this developing? Sure. So DocGo is a mobile healthcare company. Essentially, we bring care to where it's needed, when it's needed. We're one of the largest mobile healthcare companies in the country. We also operate in the U.K. We have about a thousand mobile health vehicles and ambulances across about 29 states and the U.K. About six to seven thousand mobile health clinicians, EMTs, paramedics, nurses, all the way up through advanced practice providers, MDs. And we saw about a million patients last year. We'll do the, you know, probably more than that this year. And so we're very excited about, obviously, the huge opportunity we have in front of us. On our last call, we guided to $600 million-$650 million in revenue, $65 million-$75 million in Adjusted EBITDA. In Q2, we did $172 million in revenue, and $17.2 million. Sorry, $165 million, I believe, in revenue, $17.2 million in Adjusted EBITDA in the quarter. So growing business revenue is up 30% year-over-year in that Q2 call, profitable business, and we're very excited. The segments to answer your question on that, Sarah, we have medical transportation segment. That business is on about a $200 million annual run rate. Essentially, we built Uber for ambulances. We have an integration with Epic as an example, where hospital systems can directly, from the patient's chart, order medical transportation, mostly non-emergency medical transportation, across the hundreds of hospitals that we work with, and then that's about 25% of the business. 75% of the business is mobile healthcare, where we work with hospitals, municipalities, and payers to bring mobile healthcare services to homes and other types of settings outside of the traditional brick-and-mortar healthcare establishment. Great. And maybe we can just go one step deeper into these. So when you think about the medical transportation space, you know, early on clients were big names like Fresenius. So can you talk about how you leverage those relationships to go into a market in a capital efficient way? Yeah. So everyone always asks me, "Lee, how come you don't expand to this market? Or what about this country? Yeah. We need you in our state." And the way we've approached growth is really, we grow into markets, and we grow into service lines with partners. So, as an example, we just launched into Dallas last month, and we launched with a hospital partner doing medical transportation there. And now we'll look to add mobile healthcare, we'll look to add additional customers in that market. And even in the service lines we provide, we'll talk about, I'm sure, but we're doing tremendous growth now in the care gap closure side with our payers. And all the services, all the care gaps that we're providing were really requested to us from our payer partners. So that's the way we approach growth. We approach growth on expansion with a partner. That's how we go to market. We don't just go to a state and hang up a shingle and hope they come. We don't build it and hope they come. We actually build it with a partner in a market, and then even the expansion of our services are usually a request directly from the customers we work with, and that's allowed us to grow very efficiently. It's allowed us to grow profitably. It's allowed us to grow, in my opinion, very intelligently. Great. And as we think about the mobile health area, you guys have had a number of contract wins in that area, but you're also exiting a large contract. Can you talk about what that wind down looks like, on the New York contract, and then maybe contrast it with the growth that you have going on? Yeah. So the contract, Sarah, that I'm sure you're alluding to is the migrant-related services contract that we have with HPD, which is the Department of Housing Preservation and Development of New York City, where essentially in May of 2023, we started helping with the large influx of asylum seekers and migrants to New York. New York essentially was hit with two hundred thousand new New Yorkers coming from southern border and other parts of the world. And so the city was faced with: How are we gonna care for these asylum seekers, these migrants? And they turned to us because we've been working with the city for many years, and we started expanding on that. So, this contract that you're referring to is a $432 million contract to provide services for the migrant population, which we shared on our last call. We're in the process of winding down. We're actually in the later stages of winding that down. And I think by the end of the year, we'll be out of that contract. And that contract got politicized. We're very proud of the work that we did. We ran a wonderful operation caring for people, and we never wanted to get involved in the politics. Whether people get to come, how long they get to stay for, was never... You know, we're a medical services provider. We have an obligation if somebody needs a vaccination or somebody needs urgent care, or somebody needs crisis intervention or suicide prevention. That's what we're here to do for everybody and not get involved in any of the politics, so unfortunately that contract was involved in a lot of the politics, and so we'll be exiting that in the next, I'd say, 60-90 days as we wind down the year. As we shifted the resources and the focus from that work, we started placing a tremendous amount of effort, which we had already started doing last year, but really starting to supercharge our growth with the payer business, particularly. So we've signed multiple new contracts with insurance providers to help bring care to patients' homes, to their members' homes for chronically ill patients and patients that really haven't seen their doctor in quite some time, and the reason why we are very, very excited about that business is me, I always look for is everybody aligned to do you know, is it all the incentives aligned? and so for the patient that hasn't been able to access care, might have mobility issues, we're bringing care, we're meeting them where they are, and making them healthier and helping them manage their chronic conditions, so and ultimately keep them out of the hospital, which is what everybody wants, which we'll talk about, and then for the insurance provider, they want their members to be healthier. Healthier members, obviously great, for the health plan, but healthier members are also cheaper for the system overall because they're not in the hospital, they're not having precipitating conditions. Their chronic conditions are not getting worse, and we could talk about lots of examples. And so the patient is doing better, the health plan is doing better, the overall healthcare system is doing better, and that allows us to do better and to do well as well as we're bringing care and signing more and more contracts. So all of the incentives are wonderfully aligned. We're very excited about it. We've been helping thousands of patients. We've really expanded that business over the last, I would say, over the last 6 months, 3 months, particularly, the last 3 months, particularly ramping very, very nicely, and we're very focused on that. So exactly as you outlined, Sarah, we've been moving really some of our great resources and attention over to that business and other opportunities that we're working on that I think are gonna bear fruit for the company and are very exciting. Can you give us an idea of the scale of it now versus 3 months ago or 6 months ago? Yeah. So, I'll rewind a little bit more. Yeah ... than that, if you'll let me. Sure. I wanna rewind, not 9 months, not six months, but 9 months, if that's okay. Okay. So we really started building this model where we go to patient's home. Again, it's like Amazon or Uber for healthcare, right? The patient can see when we're arriving on their phone or via text message link. The provider can order, your physician or your hospital system can order our services, again, directly from within Epic, which we have an integration with. And so they could see exactly when our clinician's gonna arrive. We started building that really in 2022, and that was built off of the medical transportation tech platform that we had built. So all of this has been building. In December of last year, we signed our first care gap, proactive care contract to go and try to close as many care gaps as we could between December second. I'll never forget that date, December second, and they say to us: "DocGo, can you help us close care gaps for this list of 2,000 members? Here's their names, here's their chronic conditions, here's the care gap they need. Can you go engage them and go to their home and close their care gaps?" 2,000 lists. I remember thinking to myself: Oh, wow, that's 2,000. How are we ever gonna get to that? And again, people on this list need colon cancer screenings, they need diabetic retinal exams, they need bone density scans, they need vaccinations. These are really important gaps in their care that we can address, and we can. You know, not a day goes by or a week goes by that we don't find. We do a diabetic retinal exam, and a diabetes patient has elevated levels. They're at risk of blindness, right? I mean, we're really going in and having profound impact on these patients. The list was 2,000 on December second. Including Christmas, we worked, including all the holidays, we work every day, 24/7, 365, and we really had a profound impact. Fast forward 9 months to, you know, 9 or 10 months where we are right now, and we have, we're working across at least a half dozen payers for lists that range from, you know, in the hundreds of thousands of patients. So we really scale this significantly. We have a lot of work to do to scale all of the operation, and that's really what we do well, is execute. But the opportunity is right there in front of us, and I'll tell you, the teams are back at the office and in California and across the country right now working really hard, day and night, seven days a week, to really scale and ramp to serve these hundreds of thousands of patients that the health plans are entrusting us with. And it just shows also the need that's in the market right now to go and help and bring care to these patients because they have a gap in care for a reason. They have accessibility issues, they have mobility issues, they can't get to their primary care provider. The areas where they live maybe have a lack or dearth of primary care and proactive care availability for them. And so, you know, we're really serving that need, and that's what we're seeing. So we're scaling to it right now, and we think there's a tremendous opportunity in front of us. How do you handle that from an operational standpoint? I mean, it, it's a very personal visit, so there's, like, the staffing component, but there's also technology and strategy and analytics. So, how do you go from covering 2,000 - 100,000? What does that look like? Yeah. So it's funny you mention that, Sarah. The way I think about it is, the doctor coming to your home is actually an old idea. People say: "Oh, Lee, your company is so innovative. You're really forging new ground." I'm like: Mm, this is kind of the way it was, I'm told, at least in the previous generations, the doctor used to come to your house. So it's kind of an old idea. The reason why it stopped happening is 'cause incredibly inefficient for a highly trained physician, and both my brothers are physicians, you know, to go from house to house and all of that, you know, time in between the patient. It's much easier for the physician to sit back and have the patients basically just come to their office and sit in the waiting rooms and all the experiences we've had, you know, going to see the doctor. So we really, the only way to put it back the way it was, which we could all agree, is much better. When you're sick, the last thing you wanna do is not be home. You wanna be home, you certainly wanna be with your loved ones, you certainly don't wanna be in a waiting room with other sick people, and so on. So the only way to put it back to that better experience is to use technology to try to bridge the gap and make it more efficient, which is basically what we've done. So what we do is, we send our entry-level clinicians out into the field in our vehicles. They're the ones driving around. They're operating at the top end of their licensure, so they're extremely excited. They're not sitting in the back room of a dusty doctor's office. They're out in the field. They're the hero in the story. They're the hands-on. And then, yes, our physicians and our advanced practice providers are sitting back in the office waiting for the patients to stream in, except they're streaming in digitally and virtually, and then they're directing the visit. So it's a wonderful patient experience. They get to be in their living room. They get to be in their den. They get to see exactly when we're arriving. They get to be with their loved ones surrounding them, the caregivers that are involved in their care, and then it's efficient for us, so that we can see as many patients as we can for the most efficient, you know, cost-effective way, and that's how we've been able to do it profitably. So that's the way we use technology to kind of put it in scale. And so we scale. The other piece that's crucial for us, in terms of scaling, obviously, we have that labor piece that I was just describing, the technology, but the other way we scale is we vertically integrated a lot of the aspects of our business, which again, makes us very unique and increases the competitive moat around our business. So we have our own physicians practice. It's our own physicians practice that we operate in 38 states, licensed in 38 states. We operate in 29 today. It's our own vehicles, it's our own W-2 clinicians, for the most part, and it's our own tech stack, it's our own wholesale pharmacy, and so we're able to scale those pieces, and we have our own staffing agency as well that allows us to staff up quickly. So we've put all those pieces together in order to be able to scale and own that, scaling, and we're not relying on, you know, point solutions and partners to help us scale. And then part of it is also culture, which, you know, we were talking about back at the office. We have a significant magic to our culture of the company, where everybody's, you know, action-oriented. People are, again, the hero in the story. Our clinicians are driving, literally and figuratively driving, to see the patients, and so we're ramping pretty significantly, but a lot of it comes from owning a large piece of the value chain. Can you talk about the revenue model for that business? How are you working that out, and when should we start to see it impact overall revenue numbers? Yeah, so the revenue model, we'll work back from the kind of end state, which is where the whole healthcare industry is going, and it's not a secret. And in this election season, I just wrote a piece about this, this week. In this election season, pretty much nobody agrees on anything except for this, which is, in healthcare, we wanna reward and incentivize providers and healthcare clinicians and healthcare organizations on the outcomes of the patient. Is the patient healthier or not? That's how you should be rewarded. Not on how many tests you can do and how many codes you can bill and those sorts of things. So all of that movement basically is called value-based care, and you're incentivizing- The clinical care and value that you're providing to the patient, and that's basically where we're driving to as well, and we're trying to push the industry forward in that way and be a participant, really, in that new paradigm, because that's really what's gonna take to make the U.S. healthcare system healthier from where it is right now, which is quite sick. Essentially, what we do is, we go to the home to close care gaps, and when we close those care gaps, we get a per visit fee. So we may close more than one care gap in that visit. We're there to close as many care gaps as we possibly can. We get a per visit fee, which is essentially a custom rate that we've negotiated with the health plans we work with. But that's really the first step. Once we're in the home, you could think about it, we have a tremendously rich understanding and deep understanding of what the patient's environment is like. Is their home safe? Are they really getting the care that they need in the home? What are some of the barriers to their care? What are their social determinants of health? Perhaps we do a home health assessment, and so now we can start to really envelop the patient in a lot more holistic care 'cause we're in their home. They've invited us in, so to speak, and we take that very, very seriously. So once we're there, if they don't have a primary care doctor, we could become their primary care physician as part of the physicians practice that I had mentioned. Now we're closing care gaps, we're in the patient's home, we're their primary care provider, we're quarterbacking their care, is the way I like to describe it, and so now we're entering into capitated arrangements, and we're getting a PMPM, getting essentially reimbursements for the primary care that we're providing in the home. Now, if you think about it, again, this is, in my opinion, if I do say so myself, the genius of our strategy is, we're closing gaps in care, we're quarterbacking their care, we're their primary care provider. At that point, I think we're in a unique position to take risk. It's what it's called, take risk in the value-based contracts, and we'll do it intelligently when we feel like we have enough data and enough experience for all the patients that we're providing care to. So that's the full continuum of what we're building out. We're again, we're in the early innings of that. We're doing the care gaps right now. We just launched our primary care offering last quarter, and then eventually down the road, I think we're gonna be in a great position to enter into those value-based arrangements, take risk alongside the payers, take risk alongside, you know, the managed care plans, and really own, essentially, the outcomes that we're bettering for the patients. Of those half dozen payers that you're working with now, how penetrated into their book are you of their members that need care gap closures? Is there opportunity to expand your relationship? Yeah. I think we're only scratching the surface. So the payers that we work with, they have millions of members, and I talked about us across all the payers having hundreds of thousands of lives. So we can go from hundreds of thousands to millions, in a sense, but the other piece that the payers are working with us, they work across multiple states. So, you know, some of the payers had asked us: "Can you help us in Kansas?" as an example, where we don't provide services today. "Can you help us in Rhode Island?" again, where we don't provide services today. But we'll go to those markets with a partner, together. We'll go to those markets. So I think there's an expansive opportunity for us to work on both in the markets we're currently working on, but also to other states. And once we prove the tremendous value we're having in the states we're operating in with the partners we have, we can expand geographically as well, 'cause they're gonna wanna take us to the other states and municipalities and communities that they serve, that are in need of the types of services and access to care that we're helping provide. Another important relationship that DocGo has is your relationship with municipalities. And I know you guys just launched a new one with New York for mobile X-rays. Maybe can you talk about what that looks like and the opportunity to expand, that type of program? Yeah, so municipalities, well, we've been working with for many years, and really, the mission of the company is to bring highly accessible, highly affordable care to all, right? If we're doing it for just a strata of the population, then we're really not doing what we were meant to do as a company, which is to use technology to democratize access to care, to bring care to everybody, and we really can't make the healthcare system healthier if we're really not addressing everybody that needs access, and particularly underserved communities. So municipalities work with us to basically bring care to those underserved communities or populations that have barriers to access to care. So a great example of that, we're here in New York. A great example of that is we have a Street Health Outreach and Wellness program with the city of New York, where we operate a fleet of mobile clinics throughout the 5 boroughs that are bringing care to the unsheltered homeless population, right? And so the idea is if we can meet patients where they are, again, if we can meet patients where they are, then we can catch precipitating conditions, and we can provide care before it escalates into the need to be hospitalized. And so the hospital systems and the emergency departments are already, you know, at capacity, they're full, and so if we can keep patients out of those emergency departments, it's a great thing for the system overall. You know, another example is we worked with the Disability Rights Michigan group in Michigan to go into the homes of disabled veterans and provide them with vaccinations. And so these are programs that we'll bring to municipalities, and you mentioned the mobile X-ray program, where we have an X-ray on a mobile clinic that patients can step on to get a chest X-ray, and we can see if they have tuberculosis, active tuberculosis. We can provide other X-ray needs. And so bringing that again, bringing the care to where the patient is a big, you know, mission for the company. We're helping municipalities do that, too. So you have several different sales channels here. You're working with the providers, the payers, municipalities directly. How should we think about what the mix looks like today and given the opportunities you see in each market, what it could look like in 5 years? Yeah. Well, let's start with next year, then we can go to 5 years. Yeah. Sarah, that's a good question. You're already trying to get me to give guidance for 5 years from now. That's pretty good. Long-term guidance is always appreciated. So for next year, we shared on the last call- Yeah. ... I know you know, Sarah, for the group. We basically shared that we expect to do $400 million in base business revenue next year, which is the revenue that's outside of these migrant contracts that we talked about. The way it's gonna break out, projected right now, is of the $400 million, $250 million is gonna come from the hospitals that we work with. And that I mentioned that business and on the medical transportation side, we provide to hospital systems today, is a $200 million run rate business. We expect to grow that business from $200 million this year to $250 million next year. Now, that's $50 million of growth. 25 of it will come from us continuing to grow the medical transportation, and 25 of it will come from us continuing to grow the mobile healthcare that we're providing on behalf of hospital systems, and particularly transitions of care. So hospitals do not want you. When they discharge, particularly from the ED, they don't want you to boomerang back to the hospital within thirty days. We have a lot of great data points, which I'd love to brag about if we have the time, on how we're- Go ahead. Okay. Give us your paper. So we are actually. We have some great data around how we're significantly reducing ED readmissions. We have a partner of ours in California that we're working with. We've been able to reduce their hospital readmissions by about 50%-60%. Impressive ... for their most acute, highest, you know, frequent visitors to the ED. So hospitals are very much incentivized because when a patient does boomerang back to the hospital, oftentimes it hurts the quality scores of the hospitals, because why is the patient coming back after they were just discharged? And it impacts reimbursement, because if they're coming back for the same condition, they don't get reimbursed for that a second time. So hospitals are very focused on that. So we feel the $425 million is gonna come from our hospital system partners. As I mentioned, we have hundreds of hospitals that we work with across the country and the U.K. today. $100 million is gonna come from the municipal work that we were talking about. These are our programs that are bringing care to underserved populations... and $50 million is gonna come from this growing, burgeoning business that we have with the payers and the insurance providers, the care gap closure, the PCP, and the remote patient monitoring business, which we have, which we didn't talk about. Today we monitor about 50,000 patients, cardiac patients as well. We have a remote monitoring business. So $250 million from the hospitals, $100 million from the municipal work we do, and $50 million from the payers. That's about $400 million in that base business revenue next year. Five years from now, I don't think we have time for that today. But, we are very, very excited, and we, we did share- Yeah. We expect to grow 20%-30% year over year for the next, you know, foreseeable future here. That's tremendous growth. What does that look like throughout your models? How would you expect your margins to evolve, as you start to- Oh, so we're very focused on margins, as you know. The message I always say to the team is, "In order for us to help others, we have to put our own oxygen mask on first as a business." And so the more we do, the more efficient we can be, the more profitable we can be, the more people we can help. And so, you know, margins today, you know, our goal is, today we're in about the 35% gross margin, adjusted gross margin range, 33%-35%. I think the businesses that we're bringing on, particularly in the remote monitoring business, have higher margins. And some of the work we're doing on the payer side, if we can really manage that risk appropriately, again, I think we'll have big opportunity for us. We, on the $400 million, we shared that we expected about $50 million of Adjusted EBITDA on that, about 11%-12% Adjusted EBITDA for next year, and I think that's a good heuristic as we go through, you know, into next year. How about cash? How much of that is gonna fall to cash, and how do you think about, you know, where you guys are from a balance sheet perspective? You know, Sarah, you saved me. I almost went the whole time without mentioning cash, which is, like, the most important thing a lot of investors are asking. So, so that's, that. So when we originally guided, we guided to $70-80 million of cash flow from operations as our guidance. We actually, in our last call, increased that, to. We went from 60. Yeah, we increased it by $10 million. And the reason why we increased it is because, essentially, as we wind down the migrant contracts, the cash flow that, and all the floating that we're doing for those programs obviously is winding down, and we're collecting the cash and the payments there. And then, and so we feel like the company has, at the end of Q2, we had about $85 million of cash and cash equivalents on the balance sheet, and we're gonna continue to look to add to that. The payments on the migrant contracts will be lumpy. You know, we've shared that. And so as they come in, you know, it'll add to the cash balance, and then we'll look to do investments with those cash that comes in. We have a stock buyback program. We've bought back more than $10 million worth of stock since we launched that. We have a very small line of credit that we could look to pay back. We have about $30 million outstanding with that. But first and foremost, we're gonna use the cash to grow the business and to grow all the things we've been talking about throughout this chat, all the enormous opportunity that we're expanding into. And then maybe you could just go a little bit further on the cash that you are getting from the migrant contract as it winds down. Do you have to hold any of that for costs to be paid out, or are you able to take that all in as you get the payments from the state? Yeah. Most of the costs have been paid out. Okay. That's the reason why you saw the drawdown on the cash, and we still are operating aspects of the program, as I mentioned, for the next, you know, sixty or so days here as we close out the year. So yes, we'll continue to have some cash outflows to help, you know, float that. But we're now collecting balances from earlier in the year, and so the program was much larger earlier in the year, and so those sort of catching up, if you will, to those things. So that's the way it'll play out here over the course of this year and into next year and as we essentially add that back to the balance sheet, because, again, it came off the balance sheet as we were helping scale and meet this emergency, essentially. Then, you know, it'll come in, and then we'll use that, and we have plans for it. We have plans for growth. We have plans to put it to good use. Last question. What do you think investors aren't getting about DocGo right now, and where do you want us to focus on how the company's gonna transform over the next couple of years? Yeah, I think, clearly, I think people are missing the story, that I think, our company is a really unique, special company, where we are delivering proactive care. We're bringing care to where patients are, and we're helping keep them out of the hospital. Patients that need to go to the hospital, obviously, we transport them to the hospital, and they need to be there, and hospitals play a very vital function in our healthcare system. But hospitals don't want patients that have, you know, severe migraines or a urinary tract infection or a less acute care that's needed to be in the hospital system. So we're providing proactive care. We're helping keep patients out of the hospital system. There was a study that got published in 2022. For just the first primary care visit that a patient has in that year, the cost, the burden that they're placing on the system gets reduced by $4,000. If we can just go and deliver that first primary care visit, we can help save the system $4,000 per patient on average, and more for even more chronically ill patients. So I think we've built a really special platform here, where we use technology to bring care to patients' homes. I like to describe it as, you know, the Amazon of healthcare or the Uber of healthcare, which is really kind of the, you know, what, what patients expect. Essentially, as you have the whole consumerization of every industry, I think you're gonna have the consumerization of the healthcare space, and they're gonna expect that healthcare gets delivered like every other thing in their lives, and I think we've built a platform to be able to deliver care to where they are. And it's proven time and time again, if you meet customers, in our case, if you meet patients where they are, you're gonna have a very successful outcome. So we're very excited about that. We have a lot to build. You know, everybody wants our line to be straight up and to the right. That's not gonna necessarily be the case. We're gonna be straight up and to the right, but over time, we're gonna build this. We're in the very early innings, and I think the opportunity, you know, you see hundreds of billions of dollars of care get directed into the home, 'cause ultimately, that's where patients wanna be, and we've built a platform to be able to deliver just that.