Jenny Shen

Jenny Shen asked how Privia Health is evaluating the CMS LEAD Model's alignment with its long-term value-based strategy, and how it plans to maintain consistent performance across cohorts as its value-based book grows and provider mix evolves.

Answer

Parth Mehrotra (CEO, Privia Health Group) stated that Privia will evaluate the LEAD Model, which goes into effect next year, noting that the ACO REACH sunsetting creates opportunities with providers who participated in that program. He explained that the bar is high to switch from a mature MSSP ENHANCED track, and decisions will be made ACO by ACO, depending on patient population, state, and actuarial underwriting. He emphasized that maintaining consistent performance involves a nuanced, local approach, leveraging Privia's core competencies in risk management, underwriting, care delivery influence, data, and technology stack.

Jenny Shen asked how Privia Health is evaluating the CMS transition from ACO REACH to the new LEAD Model and its alignment with their long-term value-based strategy, and how they plan to maintain performance consistency across cohorts as the provider mix evolves.

Answer

Parth Mehrotra, CEO of Privia Health Group, stated that Privia Health is evaluating the new LEAD Model, which goes into effect next year, and its alignment with their strategy. He noted that the ACO REACH sunsetting creates opportunities with providers who participated in that program. He explained that for mature ACOs in MSSP ENHANCED track, the bar is high to switch to a new program, and decisions will be made ACO by ACO, state by state, based on patient population and actuarial underwriting. He emphasized that maintaining performance consistency is nuanced, varying by ACO, patient pool, benchmarks, and contracts, highlighting Privia Health's core competence in risk management, underwriting, and care delivery.

Jenny Shen, on behalf of David Larsen, asked about the potential impact of the 'big beautiful bill' on Privia, particularly concerning Medicaid or Medicare membership.

Answer

CEO Parth Mehrotra stated they do not expect a major impact. He noted that while the bill could affect Medicaid enrollment and the exchange business, these are small parts of Privia's overall book. He explained that patients who lose coverage often shift to other commercial plans where Privia's reimbursement rates are actually higher, creating a slight net positive. Furthermore, high patient demand means any lost volume is quickly backfilled.

Jenny Shen asked about Doximity's relationship and technology's integration with large pharma CRMs like Veeva, Salesforce, and IQVIA, inquiring if the new portal and Doximity's solution complement or compete with them.

Answer

CEO Jeff Tangney described Doximity's relationship with Veeva as complementary, having worked with them for three years. He noted Salesforce has fewer clients in this space. He explained that Doximity's portal focuses on digital marketing insights, which is distinct from Veeva's historical focus on in-person sales, especially as more doctors become "no-see physicians."

Jenny Shen of BTIG inquired about the demand environment and sales pipeline, noting that major hospital systems have reported slowdowns, and asked if this is translating into more cautious spending.

Answer

Johnny Hecker, CRO & EVP of Operations, responded that Consensus is not experiencing a slowdown and recently closed significant deals with large health systems. Hecker explained that the company's resilience stems from its diverse customer base across various healthcare sub-verticals (providers, payers, pharma) and its product's clear ROI in driving efficiency, which remains attractive even when providers face financial strain.

Jenny Shen of BTIG inquired about the demand environment and sales pipeline, asking if the reported slowdown in hospital volumes was translating into more cautious spending from healthcare systems.

Answer

Johnny Hecker, CRO & EVP of Operations, responded that Consensus is not experiencing a slowdown from hospital clients, citing recent significant deals with large health systems. Hecker attributed this resilience to the company's broad customer base across diverse healthcare sub-verticals and the clear ROI of its efficiency-driving services, which remain attractive to providers even under financial strain.

Jenny Shen of BTIG asked about the demand environment and sales pipeline, questioning if the slowdown seen at major hospital systems is translating into more cautious spending from Consensus's clients.

Answer

Johnny Hecker, CRO & EVP of Operations, stated that Consensus is not experiencing a slowdown and has recently closed significant deals with large health systems. He explained that the company's resilience stems from its broad customer base across diverse healthcare sub-verticals (providers, payers, pharma) and the clear ROI its efficiency-driving solutions provide, making them attractive even when clients face financial pressure.

Jenny Shen inquired about the current operating environment for hospital customers, specifically regarding labor and inflation trends, and the potential impacts from the recent U.S. election and the CMS physician fee schedule.

Answer

Johnny Hecker, CRO and EVP of Operations, noted a mixed environment where some hospitals struggle while others, particularly in specialty and multi-location healthcare, show accelerated interest. He stated there is no current business impact from the CMS rules. CEO Scott Turicchi added that while it's too early to determine the election's full impact, there is generally a weak direct correlation with their customer acquisition, though broad economic shifts could be a factor.

Jenny Shen, on for David Larson at BTIG, LLC, asked about overall utilization trends beyond oncology, noting reports of lighter volumes in ortho/MSK from hospitals and inquiring what Evolent was seeing in its other specialty areas.

Answer

CFO John Johnson reported that cardiology trends have been elevated but consistent with their expectations for the year. For MSK, radiology, and other specialties where Evolent does not take risk, he stated they have not observed any particularly significant shifts in volume within their book of business.

Jenny Shen, on behalf of David Larsen at BTIG, asked for an updated view on the impact of tariffs, including cost absorption and the ability to pass on costs to customers.

Answer

Dr. Mark Sawicki, Chief Scientific Officer, responded that the company has seen no material impact from tariffs. He clarified that if any significant tariffs were to affect the business, they would be passed through to clients, a practice for which there is historical precedent.

Jenny Shen of BTIG inquired about LifeMD's insurance business, including its current scale, state coverage, and the margin profile of insured members versus cash-pay. She also asked about the company's relationships with Novo Nordisk and Eli Lilly.

Answer

CEO Justin Schreiber explained that LifeMD is contracted with over 100 insurance plans across 40 states, covering nearly 80 million lives, and expects that coverage to double by year-end. He noted that while it's a small part of the business now, it is expected to scale significantly in 2026 with strong unit economics. He also confirmed that integrations with Lilly Direct and NovoCare are in place for branded therapies.

Representing Dave Larson of BTIG, Jenny Shen asked for more detail on the components of the medical cost trend, particularly any areas with higher-than-expected utilization.

Answer

CFO Jeff Schwaneke identified the primary pressure points in the cost trend as continued high inpatient costs and Part B drugs, specifically within oncology. He noted that this was a consistent theme carrying over from the end of the previous year into the first quarter.

Jenny Shen, on for David Lawson, asked about drug pricing dynamics for members where agilon still carries risk and sought views on a recent executive order related to drug pricing.

Answer

CEO Steven Sell reiterated that agilon's strategy is to eliminate Part D risk entirely because the company cannot materially manage it without control over prescribing, formularies, or rebates. He noted exposure is below 30% and continues to decline, but stated he did not have significant insight on the specific policy's impact.

Jenny Shen, on for David Larsen, asked for details on churn rates for the quarter compared to the previous quarter and year, and also inquired about the competitive environment, noting strong results from other pharma services companies and asking if Definitive Healthcare competes with them.

Answer

An executive stated that Q1 renewal rates were stable compared to the second half of 2024 but down versus Q1 2024, which continues to pressure net dollar retention. They added that the competitive landscape has not seen radical shifts. CFO Richard Booth elaborated that Definitive Healthcare does not have Stage 1 clinical assets, which are seeing a recovery. The company focuses on later-stage commercialization, which experiences a lag. He acknowledged that industry-wide pressures like funding uncertainty and longer decision cycles are affecting the business, consistent with peers.

Jenny Shen, on for David Larsen, questioned if a shift in pharma marketing budgets from digital to in-person channels was contributing to customer downsells. She also asked if pressure on large Contract Research Organizations (CROs) was impacting Definitive Healthcare's business.

Answer

CEO Kevin Coop responded that the primary pressure in life sciences stems from the broader macro and funding environment, not a specific shift from digital to in-person marketing. He clarified that Definitive Healthcare's market position is more of a lag indicator and is not significantly impacted by pressures on early-stage clinical trials or CROs.

Jenny Shen, on behalf of David Hynes, inquired about the overall demand environment within the pharmaceutical sector, asking if Definitive Healthcare is experiencing pressures similar to CROs due to factors like the IRA, especially given that many pharma companies are reporting strong results.

Answer

CEO Kevin Coop explained that while there are pressures in the life sciences market, Definitive Healthcare's business is less exposed to early-stage clinical trial dynamics. He noted that the company typically engages with clients at Stage 2 clinical trials or later, leading to a delayed impact from broader market improvements. Coop emphasized that the immediate focus is on reducing customer churn to stabilize the business and return to growth.

Jenny Shen, on for David Larsen, asked for a comparison of the margin profile of the migrant-related revenue versus the core business. She also inquired about potential tariff risks on medical equipment and wearables, extending beyond the vehicle fleet.

Answer

CFO Norman Rosenberg stated the migrant program's gross margin was consistently around 34%. He explained its wind-down, combined with the ramp-up of the lower-margin Payer business, negatively impacted the overall Mobile Health margin mix in Q1. CEO Lee Bienstock addressed tariffs primarily in the context of the vehicle fleet, noting that pre-placed orders for the year mitigated immediate impact. Rosenberg added that while some costs may rise, lower fuel prices could provide a partial offset.

Jenny Shen, on behalf of David Larsen at BTIG, inquired about the current rate of annual price increases and client acceptance levels amid the uncertain macroeconomic environment.

Answer

CEO Dan Burton stated that annual price increases on technology contracts are typically in the mid-single digits and have been well-accepted by clients. He contrasted this with older TEMS (services) contracts, which generally have lower, low-single-digit escalators. The company's growth is primarily coming from the tech contracts with higher annual increases.

Jenny Shen, on for David Larsen, asked about the competitive environment, particularly regarding aggressive pricing from private competitors, and inquired about Progyny's international business opportunities.

Answer

President Michael Sturmer stated that Progyny focuses on demonstrating broader, long-term value rather than competing on price, which he views as an unsustainable short-term strategy for rivals. CEO Peter Anevski added that Progyny won every jumbo account in the last sales season against these competitors. Sturmer also noted that a recent acquisition enhances their global services for large employers.

Jenny Shen, on for Dave Windley, asked for the reason behind the significant spike in the Medical Care Ratio (MCR) during the quarter, questioning why it wasn't more gradual. She also inquired about the MCR outlook for Q4 and if a sudden step-down should be expected in Q1 2025.

Answer

CEO Aric Coffman explained that the MCR spike was largely due to delayed claims information from non-delegated health plan partners, which masked escalating costs until the data was received. For Q1 2025, he stated that while they expect benefit design changes to have an immediate positive effect on utilization, the precise financial impact won't be clear until after the open enrollment period concludes and final membership is known.