Alignment Healthcare Inc (ALHC) 2022 Q4 法說會逐字稿

Good afternoon, and welcome to Alignment Healthcare's Fourth Quarter 2022 Earnings Conference Call and Webcast. (Operator Instructions) Please note that this event is being recorded. Leading today's call are John Kao, Founder and CEO; and Thomas Freeman, Chief Finance -- Financial Officer.

下午好，歡迎來到 Alignment Healthcare 的 2022 年第四季度收益電話會議和網絡直播。 （操作員說明）請注意，正在記錄此事件。主持今天電話會議的是創始人兼首席執行官 John Kao；和 Thomas Freeman，首席財務 - 財務官。

Before we begin, we would like to remind you that certain statements made during this call will be forward-looking statements as defined by the Private Securities Litigation Reform Act. These forward-looking statements are subject to various risks and uncertainties and reflect our current expectations based on our beliefs, assumptions and information currently available to us. Descriptions of some of the factors that could cause actual results to differ materially from these forward-looking statements are discussed in more detail in our filings with the SEC, including the Risk Factors section of our annual report on Form 10-K for the fiscal year ended December 31, 2022. Although we believe our expectations are reasonable, we undertake no obligation to revise any statements to reflect changes that occur after this call.

在我們開始之前，我們想提醒您，在本次電話會議中所做的某些陳述將是《私人證券訴訟改革法》所定義的前瞻性陳述。這些前瞻性陳述受各種風險和不確定性的影響，反映了我們基於我們目前可獲得的信念、假設和信息的當前預期。我們在提交給美國證券交易委員會的文件中更詳細地討論了可能導致實際結果與這些前瞻性陳述存在重大差異的一些因素的描述，包括我們本財年 10-K 表格年度報告的風險因素部分截至 2022 年 12 月 31 日。儘管我們認為我們的預期是合理的，但我們沒有義務修改任何聲明以反映此次電話會議後發生的變化。

In addition, please note that the company will be discussing certain non-GAAP financial measures that they believe are important in evaluating performance. Details on the relationship between these non-GAAP measures to the most comparable GAAP measures are reconciliation of historical non-GAAP financial measures can be found in the press release that is posted on the company's website and on our Form 10-K for the fiscal year ended December 31, 2022.

此外，請注意，公司將討論他們認為對評估業績很重要的某些非 GAAP 財務指標。有關這些非 GAAP 措施與最具可比性的 GAAP 措施之間關係的詳細信息是對歷史非 GAAP 財務措施的調節，可在公司網站上發布的新聞稿和本財年的 10-K 表格中找到截至 2022 年 12 月 31 日。

With that, I would now like to hand the conference over to your speaker today, John Kao, Founder and CEO. Please go ahead.

有了這個，我現在想把會議交給今天的演講者，創始人兼首席執行官 John Kao。請繼續。

Hello, and welcome to our fourth quarter earnings conference call. We appreciate you joining us. I'd like to start us off by congratulating our employees for a year of outstanding progress and continued dedication to serving our members. As we approach the 10-year anniversary of our founding, I'd like to take a moment to reflect our accomplishments together. We've grown our membership from less than 13,000 in 2014 to over 108,000 today, and have grown revenue from just $130 million to an expected $1.7 billion in 2023.

您好，歡迎來到我們的第四季度收益電話會議。感謝您加入我們。首先，我想祝賀我們的員工在過去一年取得了顯著進步，並繼續致力於為我們的會員服務。在我們成立 10 週年之際，我想花點時間來回顧一下我們共同取得的成就。我們的會員人數從 2014 年的不到 13,000 人增加到今天的 108,000 多人，收入也從僅 1.3 億美元增加到 2023 年的預計 17 億美元。

During our time together, we have focused on quality in all we do. We have helped improve our members' lives by conducting more than 300,000 face-to-face meetings between our members and our Care Anywhere teams, and completing more than 1.5 million grocery and OTC transactions. Through our Care Anywhere model and partnership with providers, our -- our inpatient utilization outcomes represent a combined total of nearly 24,000 fewer hospital stays relative to traditional Medicare, giving our members precious time with their family -- families and loved ones. And this is just the beginning.

在我們在一起的時間裡，我們所做的一切都注重質量。通過在我們的會員和我們的 Care Anywhere 團隊之間進行超過 300,000 次面對面會議，並完成超過 150 萬筆雜貨和非處方藥交易，我們幫助改善了我們會員的生活。通過我們的 Care Anywhere 模式和與供應商的合作夥伴關係，我們的住院患者利用率結果表明，與傳統醫療保險相比，住院總次數減少了近 24,000 次，讓我們的會員有寶貴的時間與家人和親人在一起。而這僅僅是個開始。

Turning to today's results. We are pleased to have concluded the year with strong performance, having met or exceeded our outlook range across each of our 4 key performance indicators for the eighth straight quarter. For the fourth quarter 2022, our total revenue of $362 million represent a 21% growth year-over-year. We ended the quarter with health plan membership of 98,400 members, growing 14% year-over-year. Adjusted gross profit was $38.3 million, resulting in an MBR of 89.4%. Meanwhile, our adjusted EBITDA was negative $23.7 million. Concluding the full year total revenue of $1.434 billion grew 23%. Adjusted gross profit of $193.6 million resulted in an MBR of 86.5%, and adjusted EBITDA was a loss of $26.7 million, all well ahead of our initial and updated expectations.

轉向今天的結果。我們很高興以強勁的表現結束了這一年，連續第八個季度達到或超過了我們 4 項關鍵績效指標中每一項的預期範圍。 2022 年第四季度，我們的總收入為 3.62 億美元，同比增長 21%。本季度末，我們擁有 98,400 名健康計劃會員，同比增長 14%。調整後的毛利潤為 3830 萬美元，MBR 為 89.4%。與此同時，我們調整後的 EBITDA 為負 2370 萬美元。全年總收入為 14.34 億美元，增長 23%。調整後的毛利潤為 1.936 億美元，MBR 為 86.5%，調整後的 EBITDA 為虧損 2670 萬美元，均遠超我們最初和更新後的預期。

Last year, we conveyed expectations for our California market to be slightly adjusted EBITDA positive in 2022. We are proud to share that we exceeded those expectations and produced an MBR of 86.3%, even as we rapidly brought on new members. This result was driven by ongoing clinical engagement with our provider partners and members through our Care Anywhere clinical teams and greater operating scale.

去年，我們表達了對加州市場 2022 年略微調整後 EBITDA 為正的預期。我們很自豪地宣布，我們超出了這些預期，即使我們迅速吸引了新成員，MBR 也達到了 86.3%。這一結果是通過我們的 Care Anywhere 臨床團隊與我們的供應商合作夥伴和成員的持續臨床參與以及更大的運營規模推動的。

Additionally, each one of our new states ran less than 155 inpatient admissions per thousand, a powerful testament to the replicability of our care model. This is similar to our California performance, which has ranged between 155 to 165 admissions per thousand over the past 6 years, and nearly 40% better than the traditional Medicare, which averages over 250 inpatient emissions per thousand.

此外，我們每個新州的每千人入院人數都不到 155 人，這有力地證明了我們護理模式的可複制性。這與我們在加利福尼亞州的表現相似，在過去 6 年中，每千人入院人數在 155 至 165 人之間，比傳統醫療保險（平均每千人住院人數超過 250 人）高出近 40%。

I'd like to share a few statistics that demonstrate how we are consistently improving outcomes across markets by deploying our Care Anywhere clinical engagement model powered by AVA Insights. Number one, members in our Care Anywhere program show a 32% net reduction in institutional claims expense 12 months after engagement versus Care Anywhere eligible members who did not enroll in the program.

我想分享一些統計數據，展示我們如何通過部署由 AVA Insights 提供支持的 Care Anywhere 臨床參與模型來持續改善整個市場的結果。第一，我們的 Care Anywhere 計劃的成員在參與 12 個月後與未加入該計劃的 Care Anywhere 合格成員相比，機構索賠費用淨減少 32%。

Number two, at-risk members across all chronic condition cohorts saw 47% lower ER visits per thousand versus traditional Medicare, including 58% reduction in ER utilization for members with 6 or more chronic conditions. And number three, lastly, at-risk members from our year 1 cohort to our year 6-plus cohorts see a 10% improvement in MBR going from 88% to 78%. The improvement in MBR acts as the funding mechanism for our rich product benefits, and we see even greater opportunity ahead of us as we replicate these results across an increasingly large membership base.

第二，與傳統醫療保險相比，所有慢性病隊列中的高危成員的每千人急診就診次數減少了 47%，其中患有 6 種或更多慢性病的成員的急診使用率降低了 58%。第三，最後，從我們 1 年級隊列到 6 年級以上隊列的高危成員的 MBR 從 88% 提高了 10% 到 78%。 MBR 的改進是我們豐富產品優勢的資金機制，隨著我們在越來越大的會員基礎上複製這些結果，我們看到了更大的機會。

These examples and more are described in greater detail on our latest corporate presentation available on our Investor Relations page. Importantly, they showcase how our AVA-powered Care Anywhere clinical model is making a difference in members' lives, while driving our outstanding MBR results in 2022. Furthermore, we are seeing these clinical outcomes materialize, not just in our Medicare Advantage members, but also in our fee-for-service members. CMS recently released data for direct contracting performance year 2021 results, and despite having the second lowest weighted average benchmark PMPM in the country, we produce top quartile net savings results.

這些示例以及更多示例在我們的投資者關係頁面上提供的最新公司介紹中有更詳細的描述。重要的是，它們展示了我們的 AVA 支持的 Care Anywhere 臨床模型如何改變會員的生活，同時推動我們在 2022 年取得出色的 MBR 結果。此外，我們看到這些臨床成果不僅在我們的 Medicare Advantage 會員中實現，而且也在我們的收費服務會員中。 CMS 最近發布了 2021 年直接合同績效數據，儘管加權平均基準 PMPM 在該國排名第二，但我們產生了前四分之一的淨儲蓄結果。

These results underscore the adaptability of our clinical engagement model and our ability to effectively manage costs across Medicare populations. When we first began our DCE efforts in 2021, we balanced the strategic merits working more collaboratively with our provider partners across a broader portion of their senior panel with a cautious attitude toward the long-term economics of the program. With our '21 and '22 performance in mind, we have grown increasingly comfortable that we could generate a positive long-term margin on the ACO reach book of business, and most importantly, continue to leverage the program as a way to drive more strategic and integrated relationships with providers that complement our MA business.

這些結果強調了我們臨床參與模型的適應性以及我們有效管理醫療保險人群成本的能力。當我們在 2021 年首次開始我們的 DCE 工作時，我們平衡了與我們的供應商合作夥伴在更廣泛的高級小組中更加協作的戰略優勢，以及對該項目的長期經濟性持謹慎態度。考慮到我們在 21 年和 22 年的表現，我們越來越相信我們可以在 ACO 業務範圍內產生積極的長期利潤，最重要的是，繼續利用該計劃作為推動更具戰略意義的方式以及與供應商的綜合關係，以補充我們的 MA 業務。

Accordingly, we have continued to invest resources in the ACO reach program for 2023, and began the year with 7,900 aligned beneficiaries, an increase of 52% year-over-year.

因此，我們繼續在 2023 年的 ACO 覆蓋計劃中投入資源，年初有 7,900 名一致受益人，同比增長 52%。

Turning to the results of this annual enrollment period as of January 1, 2023, we had 108,300 Medicare Advantage members, representing approximately 17% growth year-over-year. We previously shared a few highlights from the selling season, including a successful market launch in Fresno, California with 1,800 new members; improved performance in Southern California versus 2022, netting 16% growth year-over-year; a 50 basis point improvement in our California AEP voluntary disenrollment rate; and lastly, positive momentum in our states outside of California, with membership growth of more than 60% year-over-year. These achievements were a direct result of our ability to replicate our AVA insights and Care Anywhere outcomes, giving us the confidence to create market-leading products.

看看截至 2023 年 1 月 1 日的年度註冊期結果，我們擁有 108,300 名 Medicare Advantage 會員，同比增長約 17%。我們之前分享了銷售季的一些亮點，包括在加利福尼亞州弗雷斯諾成功推出市場，吸引了 1,800 名新會員；與 2022 年相比，南加州的業績有所改善，同比增長 16%；我們的加州 AEP 自願退出率提高了 50 個基點；最後，我們在加利福尼亞州以外的州取得了積極的勢頭，會員人數同比增長超過 60%。這些成就是我們複製 AVA 見解和 Care Anywhere 成果的直接結果，讓我們有信心創造市場領先的產品。

As we continue to target 20% top line growth in 2024, we are focused on 4 areas this year that we believe are key to driving repeatable market success in future years. First, we are doubling down on our quality and cost initiatives, which has been the foundational element of our playbook for sustained growth, both inside and outside of California. Maximizing stars outcomes as part of these efforts remains a strategic priority for us heading into 2023, as evidenced by the successful AEP in North Carolina, where we achieved our first five-star plan.

由於我們繼續將 2024 年的收入增長目標定為 20%，因此我們今年將重點放在 4 個領域，我們認為這些領域是在未來幾年推動可重複的市場成功的關鍵。首先，我們正在加倍努力實施質量和成本計劃，這一直是我們在加州內外實現持續增長的基本要素。作為這些努力的一部分，最大化星級成果仍然是我們進入 2023 年的戰略重點，北卡羅來納州成功的 AEP 就是證明，我們在那裡實現了第一個五星級計劃。

Second, we are deepening relationships with our provider partners and expanding our network to create greater access for members. We have established a significant geographic footprint and remain focused on going deep in each one of our markets. Third, we are laser-focused on creating opportunities to increase the richness of our products heading into 2024 without sacrificing MBR, including looking at how we optimize the allocation of our rebate dollars across benefits. And fourth, we are employing a broader, more balanced distribution strategy. We will continue to invest in our durable relationships with third-party brokers that have consistently delivered, while we will add internal sales agents and a greater online sales presence in areas where we need better performance.

其次，我們正在加深與供應商合作夥伴的關係，並擴大我們的網絡，為會員創造更多的機會。我們已經建立了重要的地理足跡，並繼續專注於深入我們的每一個市場。第三，我們專注於創造機會，在不犧牲 MBR 的情況下增加 2024 年產品的豐富性，包括研究我們如何優化返利資金在福利中的分配。第四，我們正在採用更廣泛、更平衡的分銷策略。我們將繼續投資於我們與始終如一地提供服務的第三方經紀人的持久關係，同時我們將增加內部銷售代理，並在我們需要更好業績的領域增加在線銷售業務。

While we are pleased with the establishment of our Florida and Texas beachheads and our early traction of provider engagement, we have identified numerous targeted actions to reconfigure our growth strategies, starting with our 4-pillar playbook, with a noted emphasis on distribution.

雖然我們對佛羅里達和德克薩斯灘頭陣地的建立以及供應商參與的早期吸引力感到高興，但我們已經確定了許多有針對性的行動來重新配置我們的增長戰略，從我們的 4 支柱劇本開始，特別強調分銷。

In summary, we have identified key pillars that we believe will elevate us to the next phase of organizational growth and look forward to sharing our progresses as we move through the year. Looking ahead to 2023, I feel confident that we are positioned for continued success as we continue to make strides across each of our key value drivers.

總而言之，我們已經確定了我們認為將提升我們組織發展下一階段的關鍵支柱，並期待在我們度過這一年時分享我們的進展。展望 2023 年，我相信隨著我們繼續在每個關鍵價值驅動因素上取得長足進步，我們將繼續取得成功。

Now I'll turn the call over to Thomas to cover the fourth quarter financial results as well as our outlook for 2023. Thomas?

現在我將把電話轉給托馬斯，討論第四季度的財務業績以及我們對 2023 年的展望。托馬斯？

Thanks, John. I'd like to echo how proud we are of the milestones we've achieved not only in '22, but throughout our journey over the past 10 years.

謝謝，約翰。我想重複我們對我們不僅在 22 年而且在過去 10 年的整個旅程中所取得的里程碑感到自豪。

Now turning to our year-end results. For the year ending December 2022, our health plan membership of 98,400 increased 14% year-over-year. Over the course of the year, we added approximately 5,700 net members from January 22 to December 2022, which is similar to our past experience. Our total revenue in 2022 grew 23% to $1.434 billion, Further, our adjusted gross profit of $193.6 million reflected an MBR of 86.5% for the full year, driven by a continuation of strong medical outcomes in California, while Care Anywhere and our core medical management capabilities began to produce outcomes in our new states as well. SG&A for the year was $295.6 million. Excluding equity-based compensation expense, our SG&A was $223.1 million.

現在轉向我們的年終業績。在截至 2022 年 12 月的一年中，我們的健康計劃會員人數為 98,400 人，同比增長 14%。在這一年中，從 2022 年 1 月 22 日到 2022 年 12 月，我們增加了大約 5,700 名淨會員，這與我們過去的經歷相似。我們在 2022 年的總收入增長了 23%，達到 14.34 億美元，此外，我們調整後的毛利潤為 1.936 億美元，反映出全年的 MBR 為 86.5%，這得益於加州持續強勁的醫療成果，而 Care Anywhere 和我們的核心醫療管理能力也開始在我們的新州產生成果。當年的 SG&A 為 2.956 億美元。不包括基於股權的補償費用，我們的 SG&A 為 2.231 億美元。

Lastly, our full year adjusted EBITDA was negative $26.7 million. This reflects a margin of negative 1.9%, and represents approximately 90 basis points of improvement year-over-year, even as we grew revenue by over 20%. As we reflect on the year, we're proud to note that we ultimately delivered a $97 million revenue beat and a $16 million adjusted EBITDA beat, both relative to the respective midpoints of our initial 2022 guidance. We aim to strike a continued balance between both our growth and profitability objectives going forward.

最後，我們全年調整後的 EBITDA 為負 2670 萬美元。這反映了 1.9% 的負利潤率，即使我們的收入增長了 20% 以上，也比去年同期提高了約 90 個基點。當我們回顧這一年時，我們很自豪地註意到，我們最終實現了 9700 萬美元的收入超預期和 1600 萬美元的調整後 EBITDA 超預期，兩者均相對於我們 2022 年初始指導的各自中點。我們的目標是在未來的增長和盈利目標之間取得持續的平衡。

Turning to the balance sheet. We ended the quarter with $245 million in net cash. The sequential step down in cash compared to the third quarter included the previously discussed timing impact of an early payment from CMS of approximately $117 million, which temporarily inflated the prior quarter ending balance. This had no impact on a full year basis.

轉向資產負債表。我們在本季度結束時擁有 2.45 億美元的淨現金。與第三季度相比現金連續減少包括先前討論的 CMS 提前付款的時間影響約 1.17 億美元，這暫時誇大了上一季度的期末餘額。這對全年沒有影響。

Moving to our 2023 guidance. For the first quarter, we expect health plan membership to be between 109,300 and 109,500 members, revenue to be in the range of $429 million and $434 million, adjusted gross profit to be between $38 million and $41 million, and adjusted EBITDA to be in the range of a loss of $17 million to a loss of $14 million. For the full year 2023, we expect health plan membership to be between 113,000 and 115,000 members, revenue to be in the range of $1.705 billion and $1.730 billion, adjusted gross profit to be between $205 million and $217 million, and adjusted EBITDA to be in the range of a loss of $34 million to a loss of $20 million.

轉到我們的 2023 年指南。第一季度，我們預計健康計劃會員人數將在 109,300 至 109,500 人之間，收入將在 4.29 億美元至 4.34 億美元之間，調整後的毛利將在 3800 萬至 4100 萬美元之間，調整後的 EBITDA 將在損失 1700 萬美元到 1400 萬美元不等。對於 2023 年全年，我們預計健康計劃會員人數將在 113,000 至 115,000 人之間，收入將在 17.05 億美元至 17.30 億美元之間，調整後的毛利將在 2.05 億美元至 2.17 億美元之間，調整後的 EBITDA 將在損失 3400 萬美元到 2000 萬美元之間。

Consistent with our long-term outlook, the midpoint of our 2023 revenue guidance represents approximately 20% growth year-over-year. As part of our forecast, we are assuming continued growth of our health plan membership throughout 2023, comparable to our experience from January to December in prior years. Our health plan revenue per member per month forecast contemplates a few moving parts. First, our returning member revenue PMPM is increasing year-over-year, partially offset by new member growth, which on average comes in at lower PMPM.

與我們的長期展望一致，我們 2023 年收入指引的中點代表同比增長約 20%。作為我們預測的一部分，我們假設我們的健康計劃會員人數在整個 2023 年持續增長，與往年 1 月至 12 月的經歷相當。我們每個成員每月的健康計劃收入預測考慮了幾個變動部分。首先，我們的回歸會員收入 PMPM 同比增長，部分被新會員增長所抵消，新會員增長平均以較低的 PMPM 出現。

Second, we will realize the full adverse impact of the return of sequestration, which began phasing in during the second quarter last year, and represents a roughly 75 basis point headwind to revenue PMPMs in 2023 versus full year results in 2022. Additionally, our ACO reach membership is increasing year-over-year, and we expect total program revenue of approximately $130 million, which represents over 150% growth compared to 2022 DCE revenue. While we don't include ACO reach beneficiaries in our health plan membership count guidance, the associated benchmark revenue is recognized on our income statement and is included in our guidance.

其次，我們將意識到封存回歸的全部不利影響，封存於去年第二季度開始逐步實施，與 2022 年的全年業績相比，2023 年 PMPM 收入的逆風約為 75 個基點。此外，我們的 ACO Reach 會員人數逐年增加，我們預計計劃總收入約為 1.3 億美元，與 2022 年 DCE 收入相比增長超過 150%。雖然我們的健康計劃會員人數指南中沒有包括 ACO 受益人，但相關的基準收入已在我們的損益表中確認並包含在我們的指南中。

Moving to MBR utilization. We'd like to note a few factors that impact the year-over-year comparison. First, our previously mentioned growth in ACO reach membership is expected to weigh on our consolidated MBR in 2023. At this time, we are forecasting the program to run close to 100% in 2023, presenting a drag on consolidated MBR of roughly 60 basis points year-over-year, but also creating meaningful operating leverage across our SG&A spend. We remain confident in medical improvement over time as we deploy our AVA and Care Anywhere resources and continue to view the ACO reach program as a strategic extension of our relationships with our participating provider partners.

轉向 MBR 利用率。我們想指出一些影響同比比較的因素。首先，我們之前提到的 ACO 覆蓋面成員的增長預計將在 2023 年對我們的綜合 MBR 造成壓力。目前，我們預測該計劃將在 2023 年接近 100%，對綜合 MBR 造成大約 60 個基點的拖累同比增長，但也在我們的 SG&A 支出中創造了有意義的運營槓桿。隨著我們部署 AVA 和 Care Anywhere 資源，並繼續將 ACO 覆蓋計劃視為我們與參與的供應商合作夥伴關係的戰略延伸，我們對隨著時間的推移醫療改善充滿信心。

It's also worth noting that the MBR implied in our guidance, excluding both ACO reach medical expense and revenue, is approximately 86.8% at the midpoint. Second, we expect new member growth to increase consolidated MBR by approximately 55 basis points this year and trend down in future years as we engage these new members with our Care Anywhere teams.

還值得注意的是，我們指南中隱含的 MBR（不包括 ACO 醫療費用和收入）約為中點的 86.8%。其次，我們預計今年新成員的增長將使綜合 MBR 增加約 55 個基點，並在未來幾年呈下降趨勢，因為我們讓這些新成員加入我們的 Care Anywhere 團隊。

Consistent with our past cohort experience, we are seeing strong year-over-year improvement in MBR results with our returning members, including continuing to expect non-California inpatient admissions per thousand of less than 165 in 2023. Third, we will realize the full year impact of sequestration this year, which we expect to weigh on our consolidated MBR by approximately 15 basis points. Normalizing for these 3 factors, our core MBR of 86.4% at the midpoint of our guidance reflects a continuation of strong underlying trends, and we now also expect an incremental $2 million to $4 million of additional embedded earnings power in our ACO reach members over time as they mature toward our target margins in the future.

與我們過去的隊列經驗一致，我們看到回歸成員的 MBR 結果逐年大幅改善，包括繼續預計 2023 年非加州住院患者的每千人入院人數將低於 165 人。第三，我們將實現全面今年封存的年度影響，我們預計這將對我們的合併 MBR 產生約 15 個基點的壓力。將這 3 個因素歸一化，我們的核心 MBR 為 86.4%，處於我們指導的中點，反映了強勁的潛在趨勢的延續，我們現在還預計隨著時間的推移，我們的 ACO 覆蓋成員的額外嵌入式盈利能力將增加 200 萬至 400 萬美元隨著他們在未來走向我們的目標利潤率。

Lastly, our first quarter guidance contemplates an increase in admissions per thousand, similar to our past seasonal experience. This resulted in a higher MBR in the first quarter and implies MBR over the remainder of the year will be lower than the full year MBR on average. Overall, we feel confident that we are well positioned to deliver on our full year adjusted gross profit objectives. We expect to add significant operating leverage in 2023, with $240 million of operating expense implying an SG&A ratio of 13.9%, an improvement of 140 basis points year-over-year. This is a result of our disciplined focus on deriving economies of scale as we continue to grow, along with the additional benefit from growth in our ACO reach book of business.

最後，我們的第一季度指南考慮增加每千人的入學率，這與我們過去的季節性經驗相似。這導致第一季度的 MBR 較高，這意味著今年剩餘時間的 MBR 將低於全年的平均 MBR。總的來說，我們相信我們有能力實現全年調整後的毛利目標。我們預計 2023 年將顯著增加運營槓桿，運營費用為 2.4 億美元，這意味著 SG&A 比率為 13.9%，同比提高 140 個基點。這是我們在持續增長的同時嚴格專注於獲得規模經濟的結果，以及我們 ACO 業務範圍的增長帶來的額外好處。

While we believe the long-term MBR profile of the MA business is more attractive than ACO reach, the incremental SG&A required to grow our ACO reach business is significantly less than MA. Lastly, our adjusted EBITDA outlook range takes each of these factors into account and reflects a margin of negative 1.5%, a 40 basis point improvement year-over-year and on pace with our adjusted EBITDA breakeven objective in 2024.

雖然我們認為 MA 業務的長期 MBR 概況比 ACO 範圍更具吸引力，但發展我們的 ACO 範圍業務所需的增量 SG&A 遠低於 MA。最後，我們調整後的 EBITDA 展望範圍考慮了所有這些因素，反映出負 1.5% 的利潤率，同比提高 40 個基點，與我們調整後的 2024 年 EBITDA 盈虧平衡目標保持一致。

As John mentioned earlier, our California franchise was adjusted EBITDA positive in 2022, and we expect this to continue in 2023. Our consolidated adjusted EBITDA loss guidance in 2023, therefore, continues to reflect the investments we're making to support growth in markets outside of California and future expansion initiatives. As we continue to scale, we foresee a high degree of visibility into the leverage we will achieve over our corporate resources, clinical model costs and public company expenses.

正如約翰之前提到的，我們在加州的特許經營權在 2022 年調整後的 EBITDA 為正，我們預計這種情況將在 2023 年繼續。因此，我們在 2023 年的綜合調整後 EBITDA 損失指導繼續反映我們為支持外部市場增長而進行的投資加州和未來的擴張計劃。隨著我們繼續擴大規模，我們預計我們將在公司資源、臨床模型成本和上市公司費用方面實現的槓桿作用具有高度可見性。

Importantly, our strong balance sheet position and operating projections give us confidence that we will not require additional financing to fund our organic growth objectives in the future. I'm proud of how we are positioned today, and we look forward to updating you all on our progress throughout the year.

重要的是，我們強大的資產負債表狀況和運營預測讓我們相信，我們未來不需要額外融資來為我們的有機增長目標提供資金。我為我們今天的定位感到自豪，我們期待著向大家介紹我們全年的最新進展。

With that, let's open the call to questions. Operator?

有了這個，讓我們打開問題的電話。操作員？

(Operator Instructions) Our first question comes from the line of Connor Massari of Morgan Stanley.

（操作員說明）我們的第一個問題來自摩根士丹利的 Connor Massari。

Connor Massari ?

康納馬薩里？

Our question comes from the line of Whit Mayo of SVB.

我們的問題來自 SVB 的 Whit Mayo。

Can you hear me?

你能聽到我嗎？

Yes.

是的。

John, I just wanted to go back to your prepared comments and kind of unpack some of the initiatives you have around stars, just where you're focused, where you're not particularly happy where you think you can advance some improvement. You sit pretty close on some of the cut points on your largest age contract? And maybe just provide some thinking around how you're sort of reviewing the rebate dollars?

約翰，我只想回到你準備好的評論，並解開你圍繞明星提出的一些倡議，就在你關注的地方，在你認為可以推進一些改進的地方，你不是特別高興的地方。你非常接近你最大年齡合同的一些削減點？也許只是提供一些關於您如何審查回扣美元的想法？

Whit, great question. We are still one of the first, and I think there may be somebody else that got in the early days of our company's history, got from 3 stars to 4.5 stars. And that focus was on ensuring that stars was not just a departmental function, but really a corporate initiative and a corporate commitment all the way from our Board to me, to the entire company. And so we've kind of reinstituted that kind of thinking really with enterprise-wide training along all the star measures. And I think -- I think it's something that we have to do to address just the industry-wide increase in cut points across all the different measures. And to be -- 4 stars today is you got to get better to stay in 4 stars.

惠特，好問題。我們仍然是第一批，我認為在我們公司歷史的早期可能還有其他人，從 3 星到 4.5 星。重點是確保明星不僅僅是一個部門職能，而是真正的企業倡議和企業承諾，從我們的董事會到我，再到整個公司。因此，我們通過所有明星措施的企業範圍培訓，重新建立了這種思維方式。而且我認為 - 我認為這是我們必須做的事情，以解決整個行業在所有不同措施中削減點的增加。成為——今天的 4 星是你必須變得更好才能留在 4 星。

And I think with respect to the rebate concept -- I think we're a good company right now. And we did a good job in 22 stars. I think 23 stars is going to be harder also. And so we have to get better along those lines moving towards 4.5 to 5 stars in every one of our markets. And we have to get better on, -- I mean, our MLR engine. Our medical management and clinical operations is really, really good, like really good. I'm really proud of what the team is doing there. But there's opportunities for us to improve there as well. All of which, I think, address kind of the rebate question, which is really something that I think we have to get better at to drive the kind of membership growth in MA that we want.

我認為關於回扣概念——我認為我們現在是一家好公司。而我們在22星方面做得很好。我認為 23 星也會更難。因此，我們必須在我們的每個市場中朝著 4.5 到 5 星的目標邁進。我們必須做得更好——我的意思是，我們的 MLR 引擎。我們的醫療管理和臨床操作真的非常非常好，非常好。我為團隊在那裡所做的事情感到非常自豪。但我們也有機會在這方面進行改進。我認為，所有這些都解決了某種回扣問題，我認為這確實是我們必須更好地推動我們想要的 MA 會員增長的事情。

And so it's really across the board Whit, on pretty much everything we do, just because I think, in the 23 measures, we were notified, and the industry was notified, that the cut points were even going to be higher. And so we have to do it on an enterprise level. And I'm encouraged with the feedback from the employees and the call to arms, so to speak, and just really proud of the team for stepping up.

所以它真的是全面的惠特，在我們所做的幾乎所有事情上，只是因為我認為，在 23 項措施中，我們被通知，並且行業被通知，削減點甚至會更高。所以我們必須在企業層面上這樣做。我對員工的反饋和戰鬥的號召感到鼓舞，可以這麼說，我真的為團隊的挺身而出感到自豪。

Last question for me is just looking at some of the new markets, North Carolina, Arizona, Nevada, maybe just an update around some of the inroads you're making on physician partnerships and just engagement efforts, gain-sharing strategies? Anything that you've learned.

我的最後一個問題只是關註一些新市場，北卡羅來納州、亞利桑那州、內華達州，也許只是圍繞您在醫生合作夥伴關係和參與努力、收益分享策略方面取得的一些進展的最新進展？你學到的任何東西。

Yes, lots of lessons learned, obviously, from Florida and Texas. And we really concluded, you really need all 4, we call them these growth pillars that have to work, and it starts with stars. It starts with quality and stars. And what we learned in North Carolina was when you get 5 stars, you got a lot of tailwinds as a new market entrant because it brings legitimacy and credibility to your brand in a new market. And so a lot of the emphasis in Texas, Florida and all the other markets now is really getting to that star rating.

是的，很明顯，從佛羅里達州和德克薩斯州吸取了很多教訓。我們真的得出結論，你真的需要所有 4 個，我們稱它們為必鬚髮揮作用的增長支柱，它從明星開始。它始於質量和明星。我們在北卡羅來納州學到的是，當你獲得 5 星時，作為新的市場進入者你會得到很多順風，因為它為你的品牌在新市場中帶來了合法性和可信度。因此，得克薩斯州、佛羅里達州和所有其他市場現在的很多重點都真正達到了星級評級。

And that's just not enough. That combined with the medical management and AVA Career Anywhere deployment, which, again, I'm really proud of how that's being executed. We're running about 155-ish admissions per thousand outside of California, which is really one of the core reasons why we're able to beat in 2022 is the performance in these new markets excelled with what we expected. And so then even with that, you got to have good products, and we had pretty good products in all of these new markets. But really, the key thing that we learned was the distribution strategy has to be more reliable, more controllable, and we're making adjustments to the distribution.

這還不夠。這與醫療管理和 AVA Career Anywhere 部署相結合，我再次為它的執行方式感到自豪。我們在加利福尼亞州以外的地區每千人中大約有 155 人入場，這實際上是我們能夠在 2022 年擊敗的核心原因之一，因為這些新市場的表現超出了我們的預期。所以即使這樣，你也必須有好的產品，我們在所有這些新市場上都有很好的產品。但實際上，我們學到的關鍵是分發策略必須更可靠、更可控，我們正在對分發進行調整。

You need all 4 of these components to -- not just enter a market or grow a market, but really win in a market. And I think that's kind of the standard that we're holding ourselves to is if we get into a market and we're going to make investments, we can't just enter, we need to win, which is pretty consistent with pretty much every market that we've entered in California. And so we need to do the same outside of California. But those are some lessons that we're operationalizing right now as we speak.

你需要所有這 4 個組成部分——不僅僅是進入市場或發展市場，而是真正贏得市場。而且我認為這是我們堅持的標準，如果我們進入一個市場並且我們要進行投資，我們不能只是進入，我們需要贏，這與幾乎一致我們在加利福尼亞進入的每個市場。所以我們需要在加州以外的地方做同樣的事情。但這些是我們現在正在實施的一些經驗教訓。

One moment for our next question, which comes from the line of Ryan Daniels.

請稍等一下，我們的下一個問題來自 Ryan Daniels。

First one on ACO reach. I appreciate all the color there. Nice to see you're going to push more into it given your experience there. But I want to try to pair the commentary of the positive experience with experiencing 100% MBR. Is that mostly due to just the rapid growth in kind of newer patients coming in with a much higher MBR contrasted to existing patients that are lower? And if so, can you give us any color on the delta between those 2 groups?

ACO 範圍內的第一個。我欣賞那裡所有的顏色。很高興看到您將根據您在那裡的經驗投入更多精力。但我想嘗試將積極體驗的評論與體驗 100% MBR 結合起來。這主要是因為與現有較低的 MBR 患者相比，MBR 更高的新患者的快速增長嗎？如果是這樣，你能給我們關於這兩組之間的三角洲的任何顏色嗎？

Ryan, this is Thomas here. Happy to take that question. So in terms of the overall outlook for '23, I think what you're seeing from us is just maybe a prudent sort of expectation setting exercise as we think about the considerable growth we're seeing, where you're right, we're kind of going from 5,000 to 7,900 to start the year. But that also includes a pretty significant mix shift just kind of by participating provider by region, et cetera.

瑞安，我是托馬斯。很高興回答這個問題。因此，就 23 年的整體前景而言，我認為你從我們這裡看到的可能只是一種謹慎的預期設定練習，因為我們考慮到我們看到的可觀增長，你是對的，我們'今年開始時從 5,000 增加到 7,900。但這也包括一個相當重要的混合轉變，就像按地區等參與的供應商一樣。

So it's pretty much a new population for us in many respects. And so I think -- you know us, we tend to be cautious with respect to our comments on our outlook until we get our arms around new members and new groups. That being said, I think we're really very proud of our results in the 2021 outcomes that are released by CMS recently, as John mentioned, we were the second lowest benchmark in the country, which obviously means there's not as much opportunity to really bend the cost curve, yet we were still able to produce top quartile results. And I think our savings rate for 2021 calendar year was right around something like 6% in terms of how CMS measures that program.

所以在很多方面對我們來說這幾乎是一個新的人口。所以我認為 - 你了解我們，在我們獲得新成員和新團體之前，我們往往對我們對前景的評論持謹慎態度。話雖如此，我認為我們對 CMS 最近發布的 2021 年成果感到非常自豪，正如 John 提到的那樣，我們是該國第二低的基準，這顯然意味著沒有那麼多機會真正彎曲成本曲線，但我們仍然能夠產生前四分之一的結果。而且我認為，就 CMS 如何衡量該計劃而言，我們 2021 日曆年的儲蓄率大約在 6% 左右。

And I think we feel good about our 2022 results also. So I think we have a lot of confidence that this can be an accretive line of business for us and something that we can continue to grow in combination with our MA relationships. I don't think this is something where you're going to see us grow it in a really significant or material way in lieu of MA. In other words, I think our 20% revenue goal for MA kind of stands in the future. And this is really, I think, something that could be an incremental and again, accretive opportunity for us as we continue to work with these providers across a broader portion of their senior panel.

而且我認為我們對 2022 年的結果也感到滿意。因此，我認為我們有很大的信心，這對我們來說可以成為一個增值業務線，並且我們可以結合我們的 MA 關係繼續發展。我不認為這是你會看到我們以真正重要或物質的方式代替 MA 來發展它的東西。換句話說，我認為我們未來 20% 的 MA 收入目標是可行的。我認為，隨著我們繼續與這些供應商在更廣泛的高級小組中合作，這對我們來說確實是一個漸進式的機會，也是一次增值機會。

Okay. That's very helpful. And then as my follow-up, this one is for John. As you discussed your 4-pillar playbook, one of the things you mentioned, and you discussed this in the Q&A already, is optimizing rebate dollars across benefits. And I think in the context of lower potential MA rate increases for 2024, that becomes even more important.

好的。這很有幫助。然後作為我的後續行動，這是給約翰的。當你討論你的 4 支柱劇本時，你提到的其中一件事，你已經在問答中討論過，是優化福利中的回扣美元。而且我認為在 2024 年潛在 MA 利率增長較低的背景下，這變得更加重要。

So I'm curious just how you think about that maybe specific opportunities there, especially given what might be lower rebate dollars given the rate outlook for '24. Kind of what is the organization really focused on there? Is it going to differ market by market? Or are there certain benefits that you really want to push the pedal on because you've seen more engagement with consumers, et cetera? Would love some color there.

所以我很好奇你是如何看待那裡的特定機會的，特別是考慮到 24 年的利率前景，退稅美元可能會更低。該組織真正關注的是什麼？它會因市場而異嗎？還是因為您已經看到與消費者的更多互動等等，所以您真的想要踩下踏板的某些好處？會喜歡那裡的一些顏色。

Ryan, of course, great question as usual. I think just the general increase in standards across the board from CMS on star ratings -- in terms of increased cut points, in terms of reimbursement -- I actually think it will be a strategic advantage to us in the long term. And we've kind of reiterated that theme for many of you, and the company was built on ensuring that we had high quality at a low cost. And that ultimately will be the formula for the highest value creation for consumers.

Ryan，當然，像往常一樣問得好。我認為只是 CMS 在星級評定方面全面提高標準——在增加的切點和報銷方面——我認為從長遠來看，這對我們來說將是一個戰略優勢。我們已經為你們中的許多人重申了這個主題，公司建立在確保我們以低成本獲得高質量的基礎上。這最終將成為為消費者創造最高價值的公式。

I think that given some of the -- kind of the -- call it, COVID-related artificial metrics in stars -- the past several years and some of the reimbursement for the past several years, I don't think we're sustainable. I think it's going to -- the market is going to start rationalizing to our favor. That's what I think. And again, have this kind of sustainable benefit design, sustainable coverages, sustainable supplemental benefits and some of the crazy stuff that we've seen is not going to be sustainable. And I think the tightening is going to be impacting people that have been relying on some of those short-term subsidies, so to speak.

我認為，考慮到過去幾年的一些——可以稱之為——明星中與 COVID 相關的人工指標——以及過去幾年的一些報銷，我認為我們不可持續.我認為它會 - 市場將開始合理化以對我們有利。那就是我所想的。再一次，擁有這種可持續的福利設計、可持續的覆蓋範圍、可持續的補充福利以及我們所看到的一些瘋狂的東西是不可持續的。而且我認為緊縮將影響那些一直依賴其中一些短期補貼的人，可以這麼說。

So I think that we're waiting -- we're all waiting for the final notice. And I think it's going to be a really interesting bid cycle this year. I think it's going to be a lot of strategy with respect to how aggressive people are going to be in sustaining those rebate dollars and the benefits, how much people are going to pull back. But at the end of the day, if you got the best cost structure, you ought to be in the best position to still add the most value.

所以我認為我們正在等待——我們都在等待最終通知。我認為今年將是一個非常有趣的投標週期。我認為，關於人們在維持這些回扣美元和收益方面的積極性，以及人們將撤回多少，這將是很多策略。但歸根結底，如果你有最好的成本結構，你應該處於最佳位置，仍然可以增加最大的價值。

And you can combine that thought with Whit's question, you say, we just -- we got to continue to get better in stars. We got to get -- continue to get better in -- MLR, medical management. And we're good. I'm not saying we're not good. We're good. We just have to get better. That's what's going to drive that incremental rebate value to consumers. And I think a lot of these artificial kind of engineering strategies are going to go by the wayside.

你可以將這個想法與 Whit 的問題結合起來，你說，我們只是 - 我們必須繼續在明星方面變得更好。我們必須——繼續在——MLR、醫療管理方面做得更好。我們很好。我並不是說我們不好。我們很好。我們只需要變得更好。這就是將增加的回扣價值推向消費者的原因。而且我認為很多這些人為的工程策略都會被擱置一旁。

And I think your color on using AVA and the results you're achieving, not only in existing markets but new markets, is a pretty powerful testament of how you can do that.

我認為您對使用 AVA 的看法以及您在現有市場和新市場中取得的成果，都有力地證明了您如何做到這一點。

Our next question comes from the line of Michael Ha of Morgan Stanley.

我們的下一個問題來自摩根士丹利的 Michael Ha。

And maybe just to come back on the last question, piggybacking off of that one. And the advance rate notice, slightly lower than expected. And I just wanted to expand on your thoughts on competitive positioning into '24 because like you said, my thinking is -- when other MA plan may need to slow down or toggle down their benefit to mitigate potential MA rate pressure, this -- I feel like this presents a golden opportunity for the higher-quality MA plan to thrive in.

也許只是回到最後一個問題，借用那個問題。而提前通知的利率，略低於預期。我只是想把你對競爭定位的想法擴展到 24 年，因為就像你說的，我的想法是——當其他 MA 計劃可能需要放慢或切換它們的好處以減輕潛在的 MA 利率壓力時，這——我感覺這為更高質量的 MA 計劃提供了一個千載難逢的機會。

So your superior star rating care delivery model, do you think that presents a stronger possibility for alignment to in '24 perhaps to gain market share, see outsized growth? And just general thoughts around that or expanded thoughts on that?

因此，您的高級星級護理提供模式，您是否認為它更有可能與 24 世紀保持一致，或許可以獲得市場份額，實現超額增長？只是圍繞那個的一般想法還是對此的擴展想法？

Yes, Michael, this is Thomas. I think what you're describing is definitely an interesting dynamic that we're contemplating as we look out to 2024. I don't think we're going to comment too specifically on our bid strategies or our product strategies with respect to how we think that impacts the whole growth versus margin conversation today. And just being very thoughtful about not sharing too much that could adversely impact us from a strategic and competitive standpoint in this next upcoming bid cycle.

是的，邁克爾，這是托馬斯。我認為您所描述的絕對是我們在展望 2024 年時正在考慮的一個有趣的動態。我認為我們不會就我們的出價策略或產品策略發表過於具體的評論認為這會影響今天整個增長與利潤率的對話。在下一個即將到來的投標週期中，從戰略和競爭的角度來看，不要分享太多可能對我們產生不利影響的事情要非常周到。

But all that being said, I think you're exactly right. We certainly know there are some competitors in our markets who have benefited from COVID protections around star ratings. They benefited from higher-than-average benchmark increases the last couple of years. And in certain cases, I think have been able to manage some of their benefit offerings in part because they've done a nice job with risk adjustment.

但話雖如此，我認為你是完全正確的。我們當然知道我們市場上有一些競爭對手受益於圍繞星級評級的 COVID 保護。他們受益於過去幾年高於平均水平的基準增長。在某些情況下，我認為能夠管理他們的一些福利產品部分是因為他們在風險調整方面做得很好。

And as some of those things change in the future, and as CMS continues to try to tighten the dial around risk adjustment, I think the overall impact for some of our competitors could be worse than the impact on us. And it's that relative dynamic that I think is most important in terms of our ability to compete and, as John said, win in every market we're in, not just in '24, but really over the long term.

隨著其中一些事情在未來發生變化，隨著 CMS 繼續努力收緊風險調整，我認為對我們的一些競爭對手的整體影響可能比對我們的影響更糟。就我們的競爭能力而言，我認為這種相對動態是最重要的，正如約翰所說，在我們所處的每個市場中取勝，不僅僅是在 24 世紀，而是在長期內。

So as John said, it will be an interesting bid cycle coming up, but I think we feel optimistic as to what this means for the industry and our relative positioning in the years to come.

所以正如約翰所說，這將是一個有趣的投標週期，但我認為我們對這對行業的意義以及我們在未來幾年的相對定位感到樂觀。

That makes sense. Maybe just 1 more question. Looking at California, a great rebound in Southern California, regained your competitive positioning. I'm seeing SCAN, Kaiser, Centene a few top players really taking their foot off the gas pedal in terms of benefit investment. But also now, the competitive dynamics seems to have flipped in Central and North Cal, where you've seen some plans offering really aggressive Part B rebates.

這就說得通了。也許只有 1 個問題。再看加州，南加州大反彈，重新奪回競爭優勢。我看到 SCAN、Kaiser、Centene 中的一些頂級玩家在利益投資方面真的鬆開了油門。但現在，中加州和北加州的競爭態勢似乎也發生了變化，你已經看到一些計劃提供非常激進的 B 部分回扣。

So looking forward, how do you view the competitive marketplace in both SoCal and NorCal? Do you think SoCal is back to being fully rational marketplace? And do you think the aggressive offerings in NorCal are sustainable? And also 1 more question on this. The membership headwind in Central Northern California, how much of that was driven by existing member attrition versus lower-than-expected new members?

那麼展望未來，您如何看待南加州和北加州的競爭市場？你認為 SoCal 回到完全理性的市場了嗎？你認為 NorCal 的激進產品是可持續的嗎？還有 1 個問題。北加州中部的會員逆風，其中有多少是由現有會員流失與低於預期的新會員驅動的？

So in terms of the -- kind of Southern California versus Northern California dynamics, what I would say is, really, from a macro standpoint or from a kind of portfolio management standpoint across our geographies, I think there will always be different competitors who are more aggressive and are kind of more focused on growth in certain years, and other competitors who are less focused on growth and are more focused on margin in certain years.

因此，就南加州與北加州的動態關係而言，我想說的是，實際上，從宏觀角度或從我們各個地區的投資組合管理角度來看，我認為總會有不同的競爭對手更具侵略性，在某些年份更注重增長，而其他競爭對手則不太注重增長，而在某些年份更注重利潤率。

I think that's just the reality of the business, and we've sort of seen this dynamic play out time and time again, really, over the last 8, 9, 10-plus years that we've been operating here in California. So I think, to a certain extent, our belief is that we should expect it. We should expect there's always going to be someone who might be bidding more aggressively than we view is sustainable in the long run. But it's on us to make sure that we have the right product strategies, the right market management strategies, the right broker and distribution and provider relationships, such that we have insulated ourselves from some of those anomalies in any given year to still get to our 20% top line growth target on a consistent basis.

我認為這就是業務的現實，在過去的 8 年、9 年、10 多年裡，我們在加利福尼亞州開展業務，我們已經一次又一次地看到這種動態上演。所以我認為，在某種程度上，我們的信念是我們應該期待它。我們應該預料到，從長遠來看，總會有人出價比我們認為可持續的更激進。但我們有責任確保我們擁有正確的產品戰略、正確的市場管理戰略、正確的經紀人和分銷商以及供應商關係，這樣我們就可以在任何一年中將自己與這些異常情況隔離開來，從而仍然能夠實現我們的目標在一致的基礎上實現 20% 的收入增長目標。

So I don't think it's as simple as 1 competitor in 1 market that's going to kind of dictate our future performance. I think we have to continue to take control of our own destiny, and that's what you'll see from us in the future.

因此，我認為這不會像 1 個市場中的 1 個競爭對手那樣簡單，這將決定我們未來的表現。我認為我們必須繼續掌握自己的命運，這就是你未來會從我們身上看到的。

I think your second part of your question was just in terms of specifically in some of the counties in Northern California where we didn't quite see the growth we had hoped for. It was a bit of a combination, I would say, on both the retention side as well as the incremental new sales side. I think it is worth noting and reiterating that, that was again more than offset from a retention standpoint by our other markets such that California as a state was actually 50 basis points better in terms of our retention this past AEP versus 2022.

我認為你問題的第二部分只是針對北加州的一些縣，我們並沒有完全看到我們所希望的增長。我想說，在保留方面和增量新銷售方面，這有點結合。我認為值得注意並重申的是，這再次抵消了我們其他市場的保留觀點，例如加利福尼亞州在我們過去的 AEP 與 2022 年的保留率方面實際上高了 50 個基點。

Our next question comes from the line of John Ransom of Raymond James.

我們的下一個問題來自 Raymond James 的 John Ransom。

John, my question for you is the advanced notice part of that, of course, is the ICD-10 changes which are complicated, lots of codes going away. So how do you think about that kind of at a plan level, what calibrations you make? And then also what would be downstream at sort of your downstream provider level?

約翰，我的問題是提前通知部分，當然，ICD-10 的變化很複雜，很多代碼都消失了。那麼你如何在計劃層面考慮這種情況，你做了什麼校準？然後在您的下游供應商級別的下游還有什麼？

John, good question. Yes. I think from just a -- from a systems perspective, I think we're very, very well in hand. I think the way in which we engage downstream with our providers, the workflow processes, the data ingestion, all of that is just something that we've been working on for, frankly, a couple of years. So I'm not really worried about that. I think the advanced notice itself, I think is, frankly, consistent with a lot of the kind of industry themes that we've been professing over the last several quarters. And we're kind of working our way through that right now with respect to kind of directional findings.

約翰，好問題。是的。我認為，從系統的角度來看，我認為我們掌握得非常非常好。我認為我們與我們的供應商、工作流程、數據攝取等下游合作的方式，坦率地說，所有這些都是我們多年來一直在努力的事情。所以我對此並不擔心。坦率地說，我認為預先通知本身與我們在過去幾個季度中一直宣稱的許多行業主題是一致的。我們現在正在努力尋找方向性的發現。

I think that there is kind of this 3% kind of hit to risk adjustments, so to speak. Based on some of the preliminary analysis that we've looked at, there is a kind of a disproportional hit to certain populations that are of color and/or lower income in terms of specific chronic diseases impacting those populations. And so we're working our way through that. And I think that how that gets embedded in our product mix, our rebate strategy, the bids, all of that, I think, is going to be something that we're working on right now heading into -- I mean, we're already planning for '24, so to speak. I don't know if that answered your question, John.

我認為可以這麼說，風險調整有 3% 的影響。根據我們研究過的一些初步分析，就影響這些人群的特定慢性病而言，某些有色人種和/或收入較低的人群受到了不成比例的打擊。所以我們正在努力解決這個問題。而且我認為，如何將其嵌入我們的產品組合、我們的回扣策略、出價，所有這些，我認為，將成為我們現在正在努力的事情——我的意思是，我們正在已經在計劃'24，可以這麼說。約翰，我不知道這是否回答了你的問題。

Well, I guess the follow-up is, I mean, what we've heard is that, while it's a 3% hit that certain provider groups with certain profile, it might be a much bigger hit than that, and then others will be just fine. And I guess it gets down to -- at a very simplistic level, are you treating what you're coding for, or you're just coding? If you thought about your physician partners and thought, well, this group may be in a little bit of trouble, that group is going to be fine, or if that's kind of too -- too in the weeds at this point?

好吧，我想後續行動是，我的意思是，我們所聽到的是，雖然某些具有特定知名度的提供商群體的命中率為 3%，但它可能比這大得多，然後其他人會正好。我想這可以歸結為——在一個非常簡單的層面上，你是在處理你正在編碼的東西，還是只是在編碼？如果你想到你的醫生夥伴並且想，好吧，這個小組可能有點麻煩，那個小組會好起來的，或者如果這有點太 - 太在雜草中了？

Yes. I'm not sure we think about it that way. But I mean, we are looking at all the changes to the demographic changes, the non-demographic changes, the impact on different HCCs. But we are seeing some -- again, this is all public stuff, disproportionate impact to diabetes and vascular disease, in particular, certain conditions that relate to, like I said, lower income and people of color, so to speak.

是的。我不確定我們是不是這樣想的。但我的意思是，我們正在研究人口變化的所有變化，非人口變化，以及對不同 HCC 的影響。但我們看到了一些——同樣，這都是公共的東西，對糖尿病和血管疾病的影響不成比例，特別是某些與低收入和有色人種有關的情況，可以這麼說。

So that's something we're looking at. And it will be built into the product strategies and the product designs. But overall, we've heard people, to your point, in that 3%, 4% range, we've heard people say something significantly higher. And it's such a kind of strategic number with respect to how you embed your bid strategies, and it's something that we want to make sure we are very clear on. And obviously, we don't want to talk about any competitive dynamics.

所以這就是我們正在研究的事情。它將被構建到產品策略和產品設計中。但總的來說，我們聽到人們，就你的觀點而言，在 3%、4% 的範圍內，我們聽到人們說的要高得多。這是一個關於如何嵌入出價策略的戰略數字，我們希望確保我們非常清楚這一點。顯然，我們不想談論任何競爭動態。

This question comes from the line of Kevin Fischbeck of BoFA.

這個問題來自 BoFA 的 Kevin Fischbeck 的台詞。

I wanted to dig into the EBITDA guidance, and maybe it's not 100% fair because you just made the comparison more difficult by beating Q4, but it does look like, from an absolute basis, the EBITDA loss is going to be relatively flat year-over-year, and I appreciate the 40 basis points improvement. But ultimately, you're going to have to show actual EBITDA dollar improvement year-over-year, but I guess, particularly thinking about 2024. So I guess they what -- what would you say, is there anything unusual, either in the comparison year-over-year or the impact going on this year that kind of makes less of a dollar EBITDA improvement flow through in this comp?

我想深入研究 EBITDA 指導，也許這不是 100% 公平，因為你只是通過擊敗第四季度讓比較變得更加困難，但從絕對基礎上看，EBITDA 損失確實看起來相對平穩 -一年多來，我感謝 40 個基點的改進。但最終，你將不得不展示實際的 EBITDA 美元同比增長，但我想，特別是考慮到 2024 年。所以我猜他們 - 你會說什麼，有什麼不尋常的，無論是在同比比較或今年發生的影響，這種影響使 EBITDA 的改善在這個比較中有所減少？

Kevin, Thomas here. So I think in terms of the year-over-year comparison, to your point, I think we are pleased to see that we are improving in terms of our margin year-over-year. And as we continue to think about that breakeven target in the years to come, I think it's going to be a combination of both MBR improvement as well as continued operating leverage through the SG&A line item. And I think the kind of beauty of where we stand today is we've shown enough consistency with our cohort MBR performance over time, that I think we're confident that we can continue to replicate those results, not just in California, but now outside of California, where we're starting to see some of that traction materialize.

凱文，托馬斯在這裡。所以我認為就同比比較而言，就你的觀點而言，我認為我們很高興看到我們的利潤率同比有所改善。隨著我們繼續考慮未來幾年的盈虧平衡目標，我認為這將是 MBR 改進以及通過 SG&A 行項目持續運營槓桿的結合。我認為我們今天所處的美妙之處在於，隨著時間的推移，我們已經顯示出與同類 MBR 表現的足夠一致性，我認為我們有信心可以繼續複製這些結果，不僅在加利福尼亞，而且現在在加利福尼亞州以外，我們開始看到一些牽引力的實現。

And I think, on our side, we recognize that the SG&A in terms of the SG&A relative to our size of our revenue and membership, we have to continue to show improvement on to really get to breakeven. And I think if you compare 2021 to 2022, we didn't quite have a lot of improvement just continuing to absorb a lot of new expenses as a public company, but we really are starting to show that improvement now as we look out to 2023.

而且我認為，就我們而言，我們認識到 SG&A 相對於我們的收入和會員規模的 SG&A，我們必須繼續表現出改善才能真正實現收支平衡。而且我認為，如果將 2021 年與 2022 年進行比較，我們並沒有太大的改進，只是作為一家上市公司繼續吸收大量新支出，但我們現在確實開始顯示出這種改進，因為我們展望 2023 年.

So while I think we've had a lot of great proof points around our ability to manage MBR and improve MBR, I think the SG&A side of things is where we needed to continue to show the market that we can demonstrate that operating leverage over time, which is how we feel we're positioned for '23. So with those 2 things in mind, I think we still feel like we have a good shot at working towards breakeven in the future. I think we got to continue to grow. Obviously, as a part of that recipe as we -- and we think about our 2024 breakeven objective. But all things considered, I think our '23 guidance sets us up pretty solid for that objective in '24. And the last thing I'll say is, it's, of course, early, and we'll see how the year plays out. We're only 2 months in.

因此，雖然我認為我們在管理 MBR 和改進 MBR 的能力方面有很多很好的證據，但我認為 SG&A 方面是我們需要繼續向市場展示我們可以證明隨著時間的推移運營槓桿的地方，這就是我們對 23 年的定位。因此，考慮到這兩件事，我認為我們仍然覺得我們有很好的機會在未來努力實現收支平衡。我認為我們必須繼續成長。顯然，作為我們的食譜的一部分——我們考慮了 2024 年的收支平衡目標。但考慮到所有因素，我認為我們的 23 年指南為我們在 24 年的目標奠定了堅實的基礎。我要說的最後一件事是，當然，現在還早，我們將看看今年的結果如何。我們才2個月。

Okay. And then I guess on the MLR bridge, I guess I followed what you were saying on the puts and takes to get to the kind of the core EBITDA, core MLR number. But I guess the one part that I wasn't 100% following was just the 55 basis points of pressure from new members in that number? Because doesn't the 2022 number have a similar 35 basis point headwind in that number as well? So like year-over-year, is that an adjustment to be making?

好的。然後我想在 MLR 橋上，我想我是按照你在看跌期權上所說的話來得出核心 EBITDA 的那種，核心 MLR 數。但我想我沒有 100% 關注的部分只是來自該數字的新成員的 55 個基點壓力？因為 2022 年的數字不也有類似的 35 個基點逆風嗎？因此，與去年同期相比，這是要進行的調整嗎？

Yes, that's -- so the 55 is actually the incremental. So to your point, there's -- the current 2022 new member MBR embedded in our overall '22 results, and really, we're measuring the expected new member MBR in '23 versus the new member MBR in '22. And it's really an incremental 55 sort of year-over-year in terms of the consolidated headwind. And so as we reflect on kind of where the growth is that we've seen so far and our expectations for the year, I would say, based on the distribution of members by market, by product, by provider group, the corresponding new member revenue PMPMs across those different variables and our expected MLR for each of those different again, groups, markets and products, we are expecting our new member MBR to be slightly higher this year than '22.

是的，那是——所以 55 實際上是增量的。因此，就您的觀點而言，當前的 2022 年新成員 MBR 嵌入了我們 22 年的整體結果中，實際上，我們正在衡量 23 年的預期新成員 MBR 與 22 年的新成員 MBR。就綜合逆風而言，這實際上是同比增加 55 種。因此，當我們反思到目前為止我們看到的增長情況以及我們對今年的預期時，我會說，根據市場、產品、提供商組、相應的新成員的成員分佈這些不同變量的收入 PMPM 以及我們對每個不同的群體、市場和產品的預期 MLR，我們預計今年我們的新成員 MBR 將略高於 22 年。

But again, that being said, I think what is most important to us is not necessarily where the new members come in at year 1, where they typically don't really produce much contribution margin anyway. What we're more focused on is our ability to manage those new members and improve those MBRs over time. And I think that we still feel really strongly and kind of confident about today.

但話雖這麼說，我認為對我們來說最重要的不一定是新成員在第一年加入的地方，他們通常不會真正產生太多的邊際貢獻。我們更關注的是我們管理這些新成員並隨著時間的推移改進這些 MBR 的能力。而且我認為我們對今天仍然感到非常強烈和自信。

Okay. So it's not the number of numbers, it's where the numbers are that's causing that year-over-year delta?

好的。所以不是數字的數量，而是數字在哪裡導致了同比增量？

That's right. It's a bit of a mix when you consider geography, product and provider.

這是正確的。當您考慮地理、產品和供應商時，它有點複雜。

This question comes from the line of Lisa Gill of JPMorgan.

這個問題來自摩根大通的Lisa Gill。

This is Cal Sternick on for Lisa. A couple of clarifications -- is your reach. I guess on the -- have you given what the margin profile of the business is over the long term? Apologies if I missed that. And then in terms of the membership growth, I know you said it's not going to preclude you from hitting your 20%-plus MA target. But how should we think about the growth trajectory of that business going forward? I know there's a much different SG&A load associated with ACO reach, but are there any material incremental investments you need to make to grow that membership?

這是麗莎的卡爾·斯特尼克。幾個澄清 - 是你的範圍。我想關於 - 你是否給出了該業務的長期利潤率？抱歉，如果我錯過了。然後就會員增長而言，我知道你說過這不會阻止你達到 20% 以上的 MA 目標。但是我們應該如何考慮該業務未來的增長軌跡呢？我知道與 ACO 範圍相關的 SG&A 負載有很大不同，但是您是否需要進行任何實質性的增量投資來增加該成員資格？

Cal, so this is Thomas here. In terms of the EBITDA comment, I think our belief today is that the ACO reach book of business is probably in the low to mid-single digits in terms of the EBITDA margin opportunity. And I think we'll continue to learn as we continue to grow that in recognizing that it is a new program, and our experience so far has been limited to a pretty small population in a pretty concentrated geography.

卡爾，這是托馬斯。就 EBITDA 評論而言，我認為我們今天的信念是，就 EBITDA 利潤率機會而言，ACO 業務範圍可能處於中低個位數。而且我認為，隨著我們不斷發展，我們將繼續學習，認識到這是一個新計劃，到目前為止，我們的經驗僅限於相當集中的地理區域中的少數人群。

So I think as we continue to expand that, like we are in '23, adding new providers in California, Florida, Arizona and Nevada, I think we'll start to get more of a broader set of experience that we can draw on that will inform our view of the longer-term margin opportunity. But I'd say that's kind of our current thinking today.

所以我認為，隨著我們繼續擴展它，就像我們在 23 年一樣，在加利福尼亞、佛羅里達、亞利桑那和內華達增加新的供應商，我認為我們將開始獲得更多更廣泛的經驗，我們可以利用這些經驗將告知我們對長期保證金機會的看法。但我想說這是我們目前的想法。

And in terms of the incremental investments required to grow this business, the reason that it's not too significant from an SG&A investment standpoint is because the providers we're partnering with are already providers that we are working with on our MA books of business. So we haven't had to create a massive or significant new business development infrastructure because these are providers and partners that we're already talking to kind of day-to-day, week-to-week as a part of our MA operations.

就發展這項業務所需的增量投資而言，從 SG&A 投資的角度來看它並不太重要的原因是因為我們與之合作的供應商已經是我們正在與我們的 MA 業務簿合作的供應商。因此，我們不必創建大規模或重要的新業務開發基礎設施，因為這些是我們已經在日常、每週的供應商和合作夥伴中進行交流，作為我們 MA 運營的一部分。

And then from a -- sort of shared services and from a fixed cost standpoint, the only real incremental resources we're deploying are in the medical expense line as we bring on more nurses, case managers, et cetera, to deploy a lot of our Care Anywhere programs for this population. But if you compare the kind of core operational aspects of ACO reach versus MA, we don't have to do claims payment. We don't have to do member services, sales and marketing, commissions, UM credentialing, the list goes on. So all these things that we have to do for MA that are obviously capital intensive in terms of SG&A, we really don't have to do for ACO reach, and that's why we're able to grow it in such a capital-efficient manner.

然後從某種共享服務和固定成本的角度來看，我們正在部署的唯一真正的增量資源是在醫療費用方面，因為我們聘請了更多的護士、個案經理等，以部署很多我們針對這一人群的 Care Anywhere 計劃。但是，如果您將 ACO 範圍的核心運營方面與 MA 進行比較，我們就不必進行索賠支付。我們不必提供會員服務、銷售和營銷、佣金、UM 認證，等等。因此，我們必須為 MA 做的所有這些在 SG&A 方面顯然是資本密集型的事情，我們真的不需要為 ACO 範圍做，這就是為什麼我們能夠以如此資本高效的方式發展它.

This question comes from the line of Nathan Rich of Goldman Sachs.

這個問題來自高盛的Nathan Rich。

Thomas, I wanted to follow up on the MBR comments that you made in response to Kevin's question. I guess what I wanted to try to get at is, I think if we make the adjustments for all of the year-over-year items that you mentioned, it seems like it's implying that MBR for returning members is going to be roughly flat year-over-year. I guess, is that roughly right? And if so, are there any factors that you kind of highlight in driving that? I guess I would have thought you'd maybe see some improvement on the MBR for this membership base. So I'd just be curious to get your thoughts there.

Thomas，我想跟進你在回答 Kevin 的問題時發表的 MBR 評論。我想我想說的是，我認為如果我們對你提到的所有同比項目進行調整，這似乎意味著返回會員的 MBR 將大致持平-超過一年。我想，這大致正確嗎？如果是這樣，在推動它的過程中，你有沒有強調什麼因素？我想我會認為您可能會看到針對此會員基礎的 MBR 有所改進。所以我很想知道你的想法。

Nathan, Thomas here. So I think we might look at that a little bit differently to the way you described it. So I think we do expect improvement on our returning members or our loyal members. And that's pretty consistent with what we've shared in terms of our historical cohort data. We're not seeing anything today that would cause us to deviate from our prior experience. So I think when you kind of think about the bridge we shared earlier, what -- again, what we're saying with the new members is that the new members in '22 and the impact of those members on '22 is consistent with the impact on '23, plus an additional 55 basis points on top of that.

內森，這裡是托馬斯。所以我認為我們可能會以與您描述的方式略有不同的方式來看待它。所以我認為我們確實希望我們的回頭客或忠誠會員有所改善。這與我們在歷史隊列數據方面分享的內容非常一致。我們今天沒有看到任何會導致我們偏離以前經驗的事情。所以我想當你考慮我們之前分享的橋樑時，我們對新成員說的是 '22 中的新成員以及這些成員對 '22 的影響與對'23的影響，再加上額外的55個基點。

If you were to actually kind of take that '23 number and we were to break it down between all the loyal and new members, you would see an expectation of the loyal or the returning members improving in '23 versus '22. I think we feel pretty good about how those trends are shaping up, both from a revenue standpoint as well as from a medical cost standpoint.

如果你真的拿那個 23 年的數字，我們要在所有忠誠會員和新會員之間進行分解，你會看到忠誠會員或回頭客的期望在 23 年與 22 年相比有所提高。我認為我們對這些趨勢的形成方式感覺很好，無論是從收入的角度還是從醫療成本的角度。

Okay. Great. And then just a quick follow-up. I guess, for '23, is there anything from an EBITDA cadence standpoint that we should be aware of? And I guess, it seemed like the 1Q EBITDA guidance was maybe a little bit lower than we would have expected relative to the full year. So I just wanted to ask if there's anything from a cadence standpoint?

好的。偉大的。然後只是快速跟進。我想，對於 23 年，從 EBITDA 節奏的角度來看，有什麼我們應該注意的嗎？我猜，相對於全年，第一季度 EBITDA 指引似乎比我們預期的要低一些。所以我只想問從節奏的角度來看是否有什麼？

Yes. So I think in terms of MBR, our guidance for Q1 reflects what we saw in January utilization, where similar to prior experience, it typically is a higher utilization month, and that was very much the case this past January, though we're pleased to share that the February utilization has come back down relative to January. And so I think if you're looking at our guidance for the first quarter of last year in terms of the implied MBR, it would actually look pretty similar to the guidance that we put out today in terms of the MBR.

是的。因此，我認為就 MBR 而言，我們對第一季度的指導反映了我們在 1 月份的利用率中看到的情況，與之前的經驗相似，這通常是利用率較高的月份，而今年 1 月份的情況就是如此，儘管我們很高興分享 2 月份的利用率相對於 1 月份有所回落。因此，我認為，如果您在隱含的 MBR 方面查看我們去年第一季度的指導，它實際上看起來與我們今天在 MBR 方面發布的指導非常相似。

That being said, I recognize we, of course, beat our guidance last year in MBR, and we'll see how this quarter plays out. But I think the seasonality we're contemplating around MBR is fairly consistent with how we might think about a normal operating environment. And then in terms of the SG&A, the last couple of years, we typically had about 55% of our SG&A hit in the back half of the year as opposed to the first half of the year, which is the ramping up of the sales and marketing expense as well as the kind of year 0 market spend around the third and the fourth quarter. So I would expect sort of a similar cadence around SG&A this year as well.

話雖這麼說，我承認我們當然在去年的 MBR 中超過了我們的指導，我們將看到本季度的表現。但我認為我們圍繞 MBR 考慮的季節性與我們對正常運營環境的看法相當一致。然後就 SG&A 而言，過去幾年，我們通常在下半年實現了大約 55% 的 SG&A，而不是在上半年，這是銷售額的增加和營銷費用以及第三和第四季度左右的 0 年市場支出。因此，我預計今年 SG&A 也會出現類似的節奏。

Thank you for your participation in today's conference. This does conclude the program, and you may now disconnect.

感謝您參加今天的會議。這確實結束了程序，您現在可以斷開連接。