P3 Health Partners Q1 2025 Earnings Call Transcript

Key Takeaways

  • We are reiterating our 2025 guidance, expecting three of four markets to be breakeven or better in Q1 and aiming to deliver sequential growth through execution of a $130 million EBITDA improvement plan.
  • Operating expenses declined 18% sequentially and 11% year-over-year in Q1, achieving the first $20 million of targeted OpEx savings while reinvesting in frontline teams.
  • Q1 reported an adjusted EBITDA loss of $22 million, driven by a single underperforming payer contract with a $9 million prior-period claim adjustment, though the rest of the business operated near breakeven.
  • Clinical initiatives are yielding lower utilization, with admits per 1,000 down 3.2%, ED visits per 1,000 down 21%, SNF admits down 22%, and high-cost claims declining 11%, helping improve medical loss ratio from 96% to 89%.
  • Membership fell 8% year-over-year to 116,000 as part of network rationalization, while per-member funding rose 8% to $10.63 PMPM, reflecting more accurate capture of disease burden.
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Earnings Conference Call
P3 Health Partners Q1 2025
00:00 / 00:00

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Operator

Good day, and welcome to the P3 Health Partners First Quarter twenty twenty five Earnings Conference Call. All participants will be in listen only mode. Please note this event is being recorded. I would now like to turn the conference over to Brian Halstead. Please go ahead.

Ryan Halsted
Managing Director at Gilmartin Group

Thank you, operator, and thank you for joining us today. Before we proceed with the call, I would like to remind everyone that certain statements made during this call are forward looking statements under The U. S. Federal securities laws, including statements regarding our financial outlook and long term target. These forward looking statements are only predictions and are based largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations.

Ryan Halsted
Managing Director at Gilmartin Group

These statements are subject to risks and uncertainties that could cause actual results to differ materially from historical experience or present expectations. Additional information concerning factors that could cause actual results to differ from statements made on this call is contained in our periodic reports filed with the SEC. The forward looking statements made during this call speak only as of the date hereof, and the company undertakes no obligation to update or revise these forward looking statements. We will refer to certain non GAAP financial measures on this call, including adjusted operating expense, adjusted EBITDA, adjusted EBITDA per member per month, medical margin, medical margin per member per month and cash flow. These non GAAP financial measures are in addition to and not a substitute for or superior to the measures of financial performance prepared in accordance with GAAP.

Ryan Halsted
Managing Director at Gilmartin Group

There are a number of limitations related to the use of these non GAAP financial measures. For example, other companies may calculate similarly titled non GAAP financial measures differently. Please refer to the appendix of our earnings release for a reconciliation of these non GAAP financial measures to the most directly comparable GAAP measures. Information presented on this call is contained in the press release that we issued today and in our SEC filings, which may be accessed from the Investors page of the P3 Health Partners website. I will now turn the call over to Eric Kaufman, CEO of P3 Health Partners.

Aric Coffman
Aric Coffman
CEO at P3 Health Partners

Thank you, Ryan, and thank you all for joining us today. The quarter was in line with our expectations. I'm going to cover the following topics in my remarks: first, our 2025 guidance second, an update on our strategic initiatives that we announced on our Q3 twenty twenty four call and third, a high level view of our quarter. Laith will go into more financial detail shortly. First, we are reiterating our guidance for 2025 based on the following facts.

Aric Coffman
Aric Coffman
CEO at P3 Health Partners

Three of our four markets are breakeven or better in Q1 and we expect operating metrics from our most recent initiatives to hit in Q2 and grow sequentially throughout the rest of the year. We have one payer that is an outlier in performance. They have been a collaborative partner helping to contractually resolve the performance issues in 2025 with more improvements ahead in 2026. Given some of the 2025 insurance benefit design changes, we are seeing that start to flow through into better financial performance across our markets. Additionally, we saw increased funding across our markets by 8% on a PMPM basis, indicating more accurate capture of disease burden even with V-twenty eight changes.

Aric Coffman
Aric Coffman
CEO at P3 Health Partners

As we outlined in our prior remarks, we began implementing our programs in the back half of twenty twenty four and are rapidly scaling in 2025, making future performance even brighter. Now on to execution. We are executing our programmatic initiatives ahead of schedule, representing over $130,000,000 of adjusted EBITDA improvements across our three buckets: operating efficiency, contracting and operational execution. On operating efficiency, we have achieved the goal of a $20,000,000 year over year improvement and have identified additional efficiencies that we are executing against in Q2 and throughout the remainder of the year. Operating expenses 1Q twenty twenty five declined 18% sequentially and 11% year over year.

Aric Coffman
Aric Coffman
CEO at P3 Health Partners

This improvement reflects streamlining corporate overhead functions and driving efficiencies in delegated services. At the same time, we've strategically reinvested dollars into our market operating teams to support frontline execution and drive long term growth. For contracting, we are ahead of schedule on the $35,000,000 in incremental EBITDA improvements and are now working on realizing additional opportunities in our remaining contracts that will impact 2025 and 2026. We have already renegotiated payer contracts to reduce Part D exposure, improve funding and are continuing to work with our one outlier payer partner on additional opportunities for improvements after addressing some of the issues we saw in 2024 and 2025. In network contracting, we had 20 10s that we disclosed that were on our watch list and 18 of the 20 have made significant improvements, while two contracts were eliminated based on a comprehensive performance analysis.

Aric Coffman
Aric Coffman
CEO at P3 Health Partners

Demand from payers and primary care providers for strong value based care partners is high. Growth remains a lever we can control, thanks to our consistent track record of achieving utilization rates better than local fee for service benchmarks and quality scores nearing or exceeding. On operational execution, the care enablement model is bearing fruit and gaining momentum in reducing medical expense and improving outcomes. The model encompasses enhanced data sharing, improved point of care decision making and real time tools supporting more comprehensive evaluations. The highest level of engagement with the deepest deployment of people and tools are what we refer to as Tier one providers, and we refer to the percentage based on the number of members in that tier.

Aric Coffman
Aric Coffman
CEO at P3 Health Partners

There has been a steady ramp of converting groups into our Tier one category, indicating the highest level of collaboration and engagement. Beginning this year, Oregon lagged the rest of the markets with the percentage of Tier one at 20% and now we are on track to have 60% enrolled by the beginning of Q3. On the medical expense side of the equation, our complex care program, which includes palliative care and hospice care is on track to deliver over $30,000,000 of savings for 2025 through three primary value creation levers: increasing clinically appropriate referrals, reducing hospital referring site of care mix and increasing the ninety to one hundred day non hospital referring site of care mix. We expect these numbers to begin to show in Q2 and continue through the second half of the year. Next, our quality performance, which is trending positively, saw a nearly 30% improvement in Part C measures when comparing April 2024 to March 2025.

Aric Coffman
Aric Coffman
CEO at P3 Health Partners

Amir will comment further on his section on the impacts across our metrics. For Q1 results, we reported membership and revenue in line with expectation. Total revenue is $373,000,000 a 4% decrease from the prior year, reflecting our intentional network and payer rationalization. Our Q1 membership decreased by 8% year over year, consistent with our prior commentary and guidance range. Our per member funding increased by 8% to $10.63 dollars on a PMPM basis compared to full year 2024, reflecting both improved capture of disease burden and favorable impact of our strategic contract renegotiations.

Aric Coffman
Aric Coffman
CEO at P3 Health Partners

We continue to enhance our ability to more thoroughly and accurately address our members' health conditions, ensuring appropriate care planning and gap closure. In doing so, we are generating more value from our existing membership base even as we've strategically exited certain partnerships and payer plans to optimize our network. I'll add a few comments on ACO reach as well. Over the past year, our ACO membership has increased by 60% and is now growing profitably. We are confident in our ACO operations contributing $8,000,000 of EBITDA as reflected in our full year guidance.

Aric Coffman
Aric Coffman
CEO at P3 Health Partners

With that, I'll hand it over to Leif to walk through our financial results in more detail.

Leif Pedersen
Leif Pedersen
Chief Financial Officer at P3 Health Partners

Thanks, Eric. I'll start by providing context for our first quarter financial results and then turn to our 2025 guidance and liquidity position. Average membership for Q1 twenty twenty five was approximately 116,000 compared to 126,000 in Q1 twenty twenty four. This 8% year over year decline was intentional and aligned with our strategy to exit unprofitable plans and remove non viable providers from our network ahead of 2025. Notably, our ACO reach population now accounts for approximately 15% of our total membership at the end of Q1.

Leif Pedersen
Leif Pedersen
Chief Financial Officer at P3 Health Partners

For the first quarter twenty twenty five, capitated revenue totaled $370,000,000 and total revenue reached $373,000,000 both in line with expectations. This represents a 4% decrease year over year, primarily driven by membership decrease noted above. On a per member basis, funding increased by 8% compared to full year 2024, reflecting enhanced burden of illness documentation accuracy and improved contract terms. Medical margin for Q1 twenty twenty five was approximately $17,000,000 or $49 pmpm compared to $37,000,000 or $96 pmpm in Q1 twenty twenty four. Q1 '20 '20 '5 included a $23,000,000 negative impact from prior year claims related to a single regional payer partner.

Leif Pedersen
Leif Pedersen
Chief Financial Officer at P3 Health Partners

After normalizing this, Q1 twenty twenty five medical loss ratio was approximately 89% compared to a full year normalized 2024 MLR of 96%. Adjusted operating expenses decreased by $3,000,000 compared to the first quarter of twenty twenty four, representing an 11% year over year improvement. The full impact of our planned cost reductions will materialize over the coming quarters. We remain diligent in reviewing our operating costs to drive efficiency across delegated services and eliminate waste within corporate overhead, while continuing to seek opportunities to enhance our effectiveness in provider and payer partnerships. Adjusted EBITDA for the quarter was a loss of $22,000,000 or $64 TMPM.

Leif Pedersen
Leif Pedersen
Chief Financial Officer at P3 Health Partners

The majority of this loss is attributable to a single underperforming contract with $9,000,000 net coming from a prior period adjustment. The breakout of the $9,000,000 is $23,000,000 in claims, as noted previously, offset by a positive $14,000,000 in retro adjustment to supplemental benefits. When normalizing for this, adjusted EBITDA would have been a loss of $13,000,000 The $13,000,000 loss was wholly attributable to a single payer performance, which is being actively remediated, the rest of the business is operating at or near breakeven. ACO Reach contributed $2,000,000 of positive EBITDA in Q1 twenty twenty five, representing a 5,000,000 sequential improvement and a $2,000,000 year over year increase. Looking ahead to the remainder of 2025, I want to reiterate our full year guidance.

Leif Pedersen
Leif Pedersen
Chief Financial Officer at P3 Health Partners

We remain confident in our ability to meet our full year targets for the year for the following primary reasons. Excluding a single payer partner who we are actively collaborating with to resolve performance issues, our markets are performing at breakeven or better in the first quarter. '2, as Eric noted, P3 is on schedule in executing the $130,000,000 operating improvement plan and has identified additional opportunities across payment integrity initiatives, end of life care management and payer reconciliations. The timing around when these additional items will materialize within our P and L is still being refined. As Amir will discuss, results from our clinical initiatives in improving utilization, including admit per thousand and ED per thousand and higher provider engagement with our care enablement model.

Leif Pedersen
Leif Pedersen
Chief Financial Officer at P3 Health Partners

Turning to the balance sheet. We ended the quarter with approximately $40,000,000 in cash. We are actively managing our liquidity and have multiple levers available to ensure adequate cash flow in 2025 and continue to receive strong support from our investors for our strategic initiatives. With that, I'll turn the call over to Amir to discuss our clinical performance.

Amir Bacchus
Amir Bacchus
Co-Founder and Chief Medical Officer at P3 Health Partners

Thanks, Leif. I'd like to focus on the clinical initiatives that are driving our performance improvement and early positive trends we're seeing across our markets. In comparing Q1 twenty twenty five to fiscal year twenty twenty four, our utilization metrics have trended positively for acute admissions, emergency department utilization and post acute care admissions with observation usage remaining the same due to the increased focus of the two midnight rule by the hospitals. Using current census data, admits per 1,000 decreased three point two percent. The emergency department per 1,000, a 21% decrease and SNF per 1,000 admits decreased 22%.

Amir Bacchus
Amir Bacchus
Co-Founder and Chief Medical Officer at P3 Health Partners

Observation rates remain flat. Furthermore, we've seen a 1% decrease in readmissions despite seasonality and our SNF average length of stay for our delegated lives have decreased from 19 to 14, a greater than 25 drop. High cost claims greater than $20,000 have decreased by 11% in January, February of twenty twenty four versus January, February of twenty twenty five. Overall, as Leif stated above, our medical loss ratio decreased from ninety six percent in fiscal year twenty twenty four to eighty nine percent in quarter one of twenty twenty five with more opportunities to come. Our clinical programs are showing initial positive results, particularly in oncology cost management and targeted initiatives for high cost disease states.

Amir Bacchus
Amir Bacchus
Co-Founder and Chief Medical Officer at P3 Health Partners

In our delegated markets, we decreased high cost elective procedures through better care coordination and appropriate site of care management. Our PCP education program velocity has significantly increased with the number of education sessions up 235% year over year, the number of educated providers up 141% year over year and the number of unique educated providers up 65% year over year. Our care enablement model is producing more frequent interactions with our providers and driving more patient visits and improved engagement. This engagement led to the adoption of a new point of care tool by our clinicians, which notably improves workflow. This is fundamental to our clinical strategy.

Amir Bacchus
Amir Bacchus
Co-Founder and Chief Medical Officer at P3 Health Partners

To date, we are already seeing a six percent plus improvement in the burden of illness capture. Moreover, we've increased our quality gap closures that would become evident in quarter two of twenty twenty five. Our complex illness program is exceeding budgeted targets with January performance above our projections and showing even more momentum as we progress into quarter two. In fact, thirty six percent of our selected members are now enrolled, putting us ahead of our goal to achieve the $30,000,000 plus as Eric and Leif described. We continue to expand our disease specific programs.

Amir Bacchus
Amir Bacchus
Co-Founder and Chief Medical Officer at P3 Health Partners

Our COPD pulmonary management program is showing positive results in reducing hospital admissions and emergency department visits for these patients. Additionally, we've launched a polypharmacy management initiative to address medication issues in our complex patients and improve medication adherence. Our P3 RESTORE program, which provides personalized one on one sessions with a physician coach aimed at reducing physician burnout, continues to receive positive feedback from our provider network. This program is a crucial part of our strategy to transform healthcare and improve engagement, yielding better patient outcomes and longer clinician tenure. Our Innovaccer implementation is now fully operational in Nevada with strong adoption across our provider partners.

Amir Bacchus
Amir Bacchus
Co-Founder and Chief Medical Officer at P3 Health Partners

The system continues to track on schedule for complete deployment across our entire population by mid summer, enabling us to standardize our data infrastructure and analytics capabilities across all markets, bring AI capabilities into our toolbox and allow us to more efficiently provide needed information to our physician partners. The fundamental clinical metrics driving our business forward are trending in the right direction. We remain confident in our ability to achieve our 2025 targets. With that, let me turn the call back to Eric for closing remarks. Eric?

Aric Coffman
Aric Coffman
CEO at P3 Health Partners

Thanks, Amir. I want to emphasize several key points to demonstrate our momentum in 2025. While there are still some headwinds facing the overall industry, we are reaffirming our guidance across all metrics based on the positive progress we are seeing as a result of the many aforementioned initiatives. Three of our four markets have already achieved breakeven or better in Q1 with our operational initiatives expected to deliver increasing benefits starting in Q2 and building throughout the year. While we do have one payer partner performing below our targets, they have been collaborative in addressing these challenges for 2025 with additional improvements on the horizon for 2026.

Aric Coffman
Aric Coffman
CEO at P3 Health Partners

It's particularly encouraging to see the positive impact of benefit design changes flowing through our financials across the markets as we expected. Despite the V-twenty eight changes, we're experiencing an approximately 8% increase in PMPM funding, reflecting our improved burden of illness capture. This is especially promising considering we are still scaling these initiatives and as we complete this rollout in 2025, our performance trajectory looks even stronger. Looking ahead to 2026, we are encouraged by the approximately 5% increase in the final rate notice from CMS, marking a significant step forward in addressing the rising costs and utilization trends. Operator, I'll now turn it back to you for questions.

Operator

Our first question comes from Brooks O'Neil with Lake Street Capital Markets. Please go ahead.

Aaron Wukmir
Healthcare Equity Research Associate at Lake Street Capital Markets, LLC

Hey, good afternoon guys. This is Aaron on the line for Brooks. Are you able to hear me okay?

Leif Pedersen
Leif Pedersen
Chief Financial Officer at P3 Health Partners

Yes, we hear you great.

Aaron Wukmir
Healthcare Equity Research Associate at Lake Street Capital Markets, LLC

Awesome. So I really appreciate all the color on the call and congrats on the progress so far. Just curious on a couple of things from our end. So I guess in relation to the $130,000,000 in EBITDA initiative, it sounds like you've made some pretty tangible progress there. I'm curious how much of that materialized in Q1 versus what you expected and maybe what we can expect to be layered in throughout the rest of the year here?

Aaron Wukmir
Healthcare Equity Research Associate at Lake Street Capital Markets, LLC

Maybe just some of the key puts and takes there would be great.

Leif Pedersen
Leif Pedersen
Chief Financial Officer at P3 Health Partners

Yes. Aaron, it's Leif here. I appreciate the question. And as it relates to the $130,000,000 of improvement from an EBITDA perspective and actually what's been layered into the P and L or achieved thus far, I would think about it this way. From a top level perspective, we do have some of the improvements back end weighted in 2025.

Leif Pedersen
Leif Pedersen
Chief Financial Officer at P3 Health Partners

So you will see a heavier benefit in the back half of the year than you see in the front half of the year. But if you broke down some of those individual components and thinking about OpEx, we achieved roughly about maybe onefive of our OpEx savings in Q1. And why I say that is, some of the activities that we did exercise to drive our OpEx savings were initiated or have an impact in Q1, and the full run rate will come back in Q2 through Q4. And then from rationalization perspective, most of those are ratably going to be seen as an impact to the P and L across equally across the quarters. So you'll see one fourth approximately come through the P and L from that standpoint.

Leif Pedersen
Leif Pedersen
Chief Financial Officer at P3 Health Partners

Really, the back weighting of from a material perspective on our EBITDA goals are really going to be around those operational execution items, and those are going to be on the back end side where we'll see a disproportionate benefit to the P and L than what you saw in Q1.

Aaron Wukmir
Healthcare Equity Research Associate at Lake Street Capital Markets, LLC

Absolutely. Okay. That makes sense. And I know Amir mentioned this briefly on the call, but I guess I'm curious about engagement and satisfaction trends with the RESTORE program. Curious if you can share any metrics there or just anything you've heard in general that's worth mentioning?

Amir Bacchus
Amir Bacchus
Co-Founder and Chief Medical Officer at P3 Health Partners

Yes. So just overall for the whole care enablement model, the whole engagement strategy that we've been doing with the increased investment with boots on the ground with our providers has been working quite well. This has given us that opportunity to do the point of care tool in the offices that drive better performance on basically everything that we do, which is great. So that's very, very good for us. As far as the P2RESTORE program, we are actively electing key providers within each market to go through the program.

Amir Bacchus
Amir Bacchus
Co-Founder and Chief Medical Officer at P3 Health Partners

And as they go through that three month program and graduate, they become people that actually become ambassadors for other providers. So that is actually working well also. So currently, we have probably nine or so physicians that have already gone through and have been enriched by the understanding what the program can deliver. So we're expecting a lot more to come from that as we disseminate what that program looks like to other physicians when we have our global physician meetings. But as far as actual numbers, as far as overall performance from those, we'll be tracking that from those physicians that have gone through to the performances in their practices.

Aaron Wukmir
Healthcare Equity Research Associate at Lake Street Capital Markets, LLC

Got it. Got it. Yes, that makes sense. Okay. Appreciate it guys. Thanks for taking our questions.

Amir Bacchus
Amir Bacchus
Co-Founder and Chief Medical Officer at P3 Health Partners

Thanks, Aaron.

Operator

The next question comes from Josh Raskin with Nephron Research. Please go ahead.

Joshua Raskin
Partner - Managed Care & Providers at Nephron Research LLC

Hi, thanks. Good evening. I guess I'd like to drill down a little bit on this one specific outlier payer that's giving you some issues. Maybe just some colors at multiple markets, maybe what percentage of capitated revenues are coming from that one? And then more specifically, what's driving the actual cost pressures from that payer?

Aric Coffman
Aric Coffman
CEO at P3 Health Partners

Josh. This is Eric. Thanks for the question. So in terms of overall markets, we don't call out any individual payers by name the way that we think about reporting out. I would say that we don't have any single payer that is more than about 22% of our overall top line revenue across any of our payers.

Aric Coffman
Aric Coffman
CEO at P3 Health Partners

And I would also say that they are being very collaborative in how we rectify some of the things that flowed into 2025 from 2024 as well as 2025 corrections and being really collaborative in how we're working together to look at 2026, including a lot of things in the benefit design.

Joshua Raskin
Partner - Managed Care & Providers at Nephron Research LLC

So I guess maybe, Eric, just like what are the actual costs? Is it more are you seeing inpatient? Are you seeing utilization of sub benefits? Or what exactly is driving those costs? What's the surprise?

Leif Pedersen
Leif Pedersen
Chief Financial Officer at P3 Health Partners

Hey, Josh, it's Leif. Those costs that came in were just to be very clear, were all truly related to 2024, and they were all mostly inpatient or disproportionately weighted to inpatient as opposed to professional services.

Joshua Raskin
Partner - Managed Care & Providers at Nephron Research LLC

Okay. So it's not like the 2025 it's not like the first quarter was running terribly wrong. It's just you've got to So one year was in line with that?

Leif Pedersen
Leif Pedersen
Chief Financial Officer at P3 Health Partners

2023 is completely isolated to 2024. Yes, 2024. Okay.

Aric Coffman
Aric Coffman
CEO at P3 Health Partners

Maybe just to add to that, Josh, in addition, when we look at that overall book of business, it was distributed throughout that geography relatively equally. And that particular payer had some claims migration difficulties is what turned out, which is what caused the delay in getting that information to us.

Joshua Raskin
Partner - Managed Care & Providers at Nephron Research LLC

All right. So they had a systems issue and then obviously it came in late. Got you. Got you. Okay.

Joshua Raskin
Partner - Managed Care & Providers at Nephron Research LLC

And then you guys mentioned and I heard it today as well, but on the last call, you were talking about these sort of payer contracts that you've been working on in terms of getting more efficiencies. And I guess I'm specifically interested in the supplemental benefit changes and maybe some of the impacts of not having the Part D risk. Is everything is that working as expected and maybe some of the highlights there?

Aric Coffman
Aric Coffman
CEO at P3 Health Partners

Yes. I would say it's working as expected and maybe even a little bit ahead of schedule. And I think where we had given guidance around those renegotiations is that we would have we did 25% of the contracts last year. It was a combination of things. It was increase in overall percent of premium that was coming through.

Aric Coffman
Aric Coffman
CEO at P3 Health Partners

It was also on rationalizing some of the supplemental benefits that were going out from a cost perspective. And then as we look into 2026, again, there's going to be additional things that happen around 2026 benefit design. But the level of engagement has been really high. And even where in one example that we have with one of the payers, our network contracts and the network that we hold is a significant improvement over the network that they hold and it's a plan we're not delegated for network. But in that particular situation, they're taking our network as a proxy to say, hey, how can we get this design even in 2025 back into what our programmatic so that we can see the same results that you're seeing in your network.

Aric Coffman
Aric Coffman
CEO at P3 Health Partners

And just across the board, the level of collaboration from our payer partners has been fantastic.

Joshua Raskin
Partner - Managed Care & Providers at Nephron Research LLC

Okay. Got you. Got you. I'll leave it there.

Aric Coffman
Aric Coffman
CEO at P3 Health Partners

Thanks, Josh.

Operator

Our next question comes from Ryan Langston with TD Cowen. Please go ahead.

Ryan Langston
Director & Senior Analyst - Healthcare Research at TD Cowen

Hey, thanks. I'm sorry if

Ryan Langston
Director & Senior Analyst - Healthcare Research at TD Cowen

I missed this, but there's been some kind of high profile public commentary out in the market about accelerating trends in Medicare Advantage. I just wanted to see if that's what you're seeing, if you're not seeing that, just kind of any maybe early reads on 2Q or just anything related to that would be helpful.

Amir Bacchus
Amir Bacchus
Co-Founder and Chief Medical Officer at P3 Health Partners

Hey, Ryan. Can you help me out a little bit? I just want to make sure I'm a little more clear as far as what you mean as far as the accelerated things that you're seeing in Medicare Advantage, just sort of speaking the same Well,

Ryan Langston
Director & Senior Analyst - Healthcare Research at TD Cowen

there was a very large public payer this week who has really talked about how trends are starting to get worse than they were even say a month ago when they reported. So just wondering if you're seeing sort of a similar trajectory or if you're not?

Amir Bacchus
Amir Bacchus
Co-Founder and Chief Medical Officer at P3 Health Partners

Actually, we're not. We're actually seeing things that from the comments that Eric made as well as Leif, things are actually improving from the benefit structures and what we've been paying or seeing as with the start of 2025 much better as far as utilization from what we see from, I would tell you from just the actual census volumes that are coming into the hospital, etcetera, things like that are actually on decrease. So those things are actually showing us good signs that things are getting better right now. We do know costs are relatively high on a per unit basis, but we do see the overall volume utilization coming down, which is a good monitor going forward.

Aric Coffman
Aric Coffman
CEO at P3 Health Partners

Then maybe one thing to add on that. Ryan, we're seeing the same trend, for what it's worth on ACO reach. When we compare first quarter over first quarter for our membership.

Ryan Langston
Director & Senior Analyst - Healthcare Research at TD Cowen

Great point. That's helpful.

Ryan Langston
Director & Senior Analyst - Healthcare Research at TD Cowen

And then I think Josh asked about kind of that one payer you called out. Maybe I'll ask about the one market. You said three out of four are breakeven. That's pretty good progress. But maybe just give us some details on kind of what's going on in that one market.

Ryan Langston
Director & Senior Analyst - Healthcare Research at TD Cowen

Is that where that payer is located? Or anything else kind of going on there you'd call out?

Leif Pedersen
Leif Pedersen
Chief Financial Officer at P3 Health Partners

Ryan, it's Leif. You kind of hit the nail on the head, leading the horse to water there, right? That one payer is in one market, and that one market is the market that is underperforming currently today. And as we noted, all of our other markets are operating at or near breakeven.

Aric Coffman
Aric Coffman
CEO at P3 Health Partners

And then I would say this is Eric. And within that market, we have more than one payer partner in that market, and we're not seeing the same kind of trend with those other payers in that same market.

Joshua Raskin
Partner - Managed Care & Providers at Nephron Research LLC

That's helpful. Thanks guys.

Amir Bacchus
Amir Bacchus
Co-Founder and Chief Medical Officer at P3 Health Partners

You're welcome. Thanks.

Operator

This is the end of the question and answer session. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

Executives
    • Aric Coffman
      Aric Coffman
      CEO
    • Leif Pedersen
      Leif Pedersen
      Chief Financial Officer
    • Amir Bacchus
      Amir Bacchus
      Co-Founder and Chief Medical Officer
Analysts
    • Ryan Halsted
      Managing Director at Gilmartin Group
    • Aaron Wukmir
      Healthcare Equity Research Associate at Lake Street Capital Markets, LLC
    • Joshua Raskin
      Partner - Managed Care & Providers at Nephron Research LLC
    • Ryan Langston
      Director & Senior Analyst - Healthcare Research at TD Cowen