Jamie Perse
Goldman Sachs Group, Inc.
All right. Good morning, everyone. I'm Jamie Perse of Goldman Sachs. Welcome to the Goldman Sachs Healthcare Conference. This is the first session of the day, so I have to make a couple of disclosures. We're required to make some disclosures in public appearances by Goldman Sachs in relations to the companies that we discuss. The disclosures related to investment banking relationships, compensation received or 1% or more ownership. We're prepared to read aloud disclosures for any issue upon request. However these disclosures are available to you in our most recent reports to U.S. clients on our firm portals.
All right. So with that out of the way, we're kicking off today with UHS, and we have Steve Filton, CFO. Thank you for joining.
Steve Filton
Executive VP, CFO & Secretary
Jamie Perse
Goldman Sachs Group, Inc.
So I wanted to focus mostly on fundamentals today. I'll ask a couple of policy questions at the end. But starting with fundamentals on the acute care side of the business. Utilization is obviously coming off a couple of very strong years. I think people were expecting moderation. We've seen some of that but it's still a pretty healthy utilization environment. What's your perspective on just where we are from a utilization perspective and how things are likely to progress from here?
Steve Filton
Executive VP, CFO & Secretary
Yes. We've talked a lot about the idea that 2024 seem like a transition year post-COVID into a sort of a post-COVID year, and 2025 certainly feels like maybe the first full post-COVID year. And it feels like our acute care metrics are mirroring the traditional metrics that we tended to experience pre-COVID. So mid-single-digit revenue growth, call that 5%, 6%, 7% talking about, let's say, 6% at the midpoint, split pretty evenly between price and volume. So 2.5%, 3%, 3.5% adjusted admission growth, 2.5%, 3%, 3.5% pricing growth. And that's kind of what we've been running and it feels to us like that's a sustainable level of acute care performance.
I'll say that I think we've talked about in the last few quarters, I think as have our public acute care hospital peers, somewhat softer procedural or surgical volumes. I think that tends to be more a comparison issue than anything else in the sense that as we emerge from the pandemic, we definitely, I think, as an industry, experienced this sort of collective catch-up in procedures that had been postponed and deferred during the pandemic. So when we compare first couple of quarters of this year last year, that's a difficult comparison because I think there is still some element of catch-up. But I think other than just slightly softer procedural surgical volumes, I think we're at this kind of historically sustainable level of both volume and pricing in the acute care segment.
Jamie Perse
Goldman Sachs Group, Inc.
I'll come back to some of the specifics, but high level, momentum you saw in the first quarter, anything you can say about the degree to which that's continued so far here in June?
Steve Filton
Executive VP, CFO & Secretary
Well, I think that the momentum that you're alluding to is this idea that now that we've returned to sort of this more normalized revenue growth metric or trajectory, we've also been able to, I think, focus on and execute on our expense structure in a way that was more difficult during the pandemic. There were a lot of pressures during the pandemic, especially on wages and labor. So there was an extremely elevated use of temporary labor, temporary and traveling nurses and others. That's been reduced fairly dramatically. Wage inflation itself has, I'd say decelerated, really, I think I really mean accelerated at a slower rate because there just isn't quite as much competition for the nurses, especially as there was during the pandemic, still a pretty tight labor market.
But again, if you look at our expenses, well controlled, supplies expense has been extremely well controlled. We really have not had any measurable impacts from the tariffs back and forth. So yes, so it's been, I think, a very favorable environment because we've got relatively steady, sustainable revenue growth, well-controlled expenses. And as a consequence, we've had now several years of increasing EBITDA, increasing margins, margin expansion, and we continue on this track to get our acute care margins back to pre-pandemic levels.
Jamie Perse
Goldman Sachs Group, Inc.
And on the kind of -- you framed this 5% to 7% half volume. On the volume side, if you were to further break it down in terms of medical versus surgical, you mentioned some of the comp issues on the surgical side of the business. But looking forward, should those 2 components be fairly equally balanced? I've been surprised with the medical strength on a relative basis. How should we think about those 2 kind of broad categories going forward?
Steve Filton
Executive VP, CFO & Secretary
I think, again, historically, those 2 categories, that is medical admissions, medical activity and surgical admissions or surgical activity have tended to move largely in tandem. So if adjusted admissions were up 3% in a quarter, generally, surgical procedures would be up 2% to 4%, something pretty tightly correlated. And yes, I think that's the expectation once we sort of get past this comparison issue that if adjusted admissions are growing by that 2.5%, 3%, 3.5% metric that surgical procedures will be growing within point or so one way or the other of that.
Jamie Perse
Goldman Sachs Group, Inc.
Okay. I wanted to touch on length of stay. It was around 4.6 days pre-COVID, went to the mid-5s during COVID. It's come down some, but it's still 6% or 7% above kind of that baseline. This has obvious dynamics around reimbursement, you're paid per patient, but your costs are per patient day. So I want to get a sense from you if there's further room to moderate length of stay or if this is more structural given the patient mix? Any perspective on length of stay?
Steve Filton
Executive VP, CFO & Secretary
Yes. We think there is an opportunity to further reduce length of stay, and that's an opportunity, as I think your question suggests, to increase the efficiency, the profitability and the margins of the business because as you suggest most of the patients for whom we're being reimbursed are being reimbursed on a per discharge basis. So there's a flat amount that we're being paid for their -- the term of their admission. And if they are discharged earlier appropriately, obviously, if the medical facts support that, then the sooner they're discharged, the more profitable we will be. And to your point, obviously, length of stay rose considerably during the pandemic when we had all these acutely ill COVID patients, has come down, obviously, significantly as the number of those patients has declined dramatically.
But it's still higher than it's been. And I think the main reason for that is the continued challenges that we face on patients who are being discharged into some other mil use. So not all patients who are discharged from an acute care hospital are discharged home. Somewhere between or around 1/3 of them are discharged into some other setting. It could be home health, it could be subacute or rehab, et cetera. And we find often that placing those patients in those types of settings can be challenging and patients stay a day or 2 or 3 days longer just because we don't have a place that can accept them.
And I think that's largely because of generally, labor shortages that were particularly exacerbated or exaggerated during the pandemic where there was such a need for acute care or nurses in an acute care setting that nurses were leaving subacute settings, whether that was, again, home health, nursing homes, in our case, behavioral hospitals and working in acute care settings. Again, I think that dynamic has improved, but we still find that some of these subacute facilities struggle to fill all their vacancies and that sometimes limits their ability to take patients. So yes, I think at the end of the day, there is an opportunity on length of stay. But in large part, the hurdle there or the headwind is largely out of our control, I believe.
Jamie Perse
Goldman Sachs Group, Inc.
I guess just sticking on this point for a minute. Are there particular end markets that are most challenging or improving at differential rates between home health or rehab? Just -- and I guess you mentioned it's out of your control in large part, but are there any initiatives you have or partnerships to -- that you can affect to move the needle here?
Steve Filton
Executive VP, CFO & Secretary
Yes. So as I think our experience has been, and I think this continues to be true about labor vacancies, they vary by geography. They don't always remain the same. So the answer, I think, is yes, I mean, we'll find those challenges in discharging to subacute more challenging in some markets for a period of time, and then it gets better, et cetera. So I wouldn't call out a particular market that's a chronic issue. And you're right. And I probably made too strong a statement when I said this is beyond our control. I was obviously alluding to the fact that this supply-demand issue of labor, I think, is kind of a macro issue. But there are things that we try and do.
Obviously, we try and create relationships, particularly where we have a significant amount of market share in our markets with subacute providers. In some cases, we'll have arrangements where we will actually pay subacute providers to essentially reserve or set aside a certain number of beds for us that sort of thing to make sure that there is availability for our patients. So there are some things we can do. Again, I was just trying to make the point that the broad labor supply-demand dynamic is somewhat out of our control, obviously.
Jamie Perse
Goldman Sachs Group, Inc.
Okay. Great. I wanted to focus on some of the new hospitals. You're in this period of a decent sized build-out across a couple of hospitals. So in rough numbers, out about 300 beds this year between West Henderson and D.C. and then another 300 beds next year with Palm Beach Gardens and the California Hospital, each of those 2 cohorts in isolation add 4% to 5% to your bed count. So how should we think about layering on admissions or adjusted admissions? First, there'll be total not same facility and then as they reach 12 months affecting same facility. How should we think about that layering of growth?
Steve Filton
Executive VP, CFO & Secretary
Yes. I mean, historically, we generally have the view that it takes a new hospital somewhere between 18 and 24 months to ramp up to I'll sort of call it, divisional average performance, both from an admissions perspective and margin, et cetera. We know those who follow the company that when we opened hospitals in Las Vegas, they tend to ramp up more quickly. We disclosed in the first quarter that the hospital that opened in West Henderson, a suburb of Las Vegas, in its first full quarter, which was the first quarter was already EBITDA positive, which is really unusual for a new hospital, particularly one, well, just -- it is unusual for a new hospital. But Vegas, I think, is an exception at the hospital in D.C., and I think the others will ramp up a little more slowly.
I think the other thing to consider is each one of the hospitals that you mentioned, Vegas, D.C., Palm Beach Gardens here in Florida, are all opening in markets where we have -- at least existing in Las Vegas, a number of existing hospitals. So there's some amount of cannibalization. But I think if you think about modeling, et cetera, you would think about trying to ramp those hospitals based on their bed size up to sort of divisional average margins, divisional average admissions in kind of an 18- to 24-month period. I would tend to do it ratably. If you want to get specific and ramp the Vegas hospital faster, you can do that. But like we've talked about this year, on a combined basis, we believe that the West Henderson and D.C.
Jamie Perse
Goldman Sachs Group, Inc.
Okay. I'll come back to that point in a second. Just on this 5% to 7% trajectory that you've roughly framed. Is the new bed growth on the acute care side supportive of that or additive to that?
Steve Filton
Executive VP, CFO & Secretary
No. I mean, when I give those sort of metrics about the 5% to 7% growth, really, they're meant to be same-store metrics.
Jamie Perse
Goldman Sachs Group, Inc.
Okay. And on the EBITDA comments, bear with me a little math here. But I think in 2024, average EBITDA per bed was like $180,000 across the network. If we applied that to West Henderson and D.C., that would be like $50 million kind of a run rate. You said you'd be modestly EBITDA positive this year. Is $50 million-ish, is that roughly the trajectory we should think about for '26 as both these hospitals kind of reach maturity?
Steve Filton
Executive VP, CFO & Secretary
Yes. I mean I'd like to caveat a little bit. Sometimes I prefer to have the numbers in front of me when I'm answering a question like that. But I think on the service side, it sounds about right. Again, ramped up over that 18 to 24-month period.
Jamie Perse
Goldman Sachs Group, Inc.
Okay. Fair enough. Shifting targets, just acute care pricing, where are we in the cycle? Obviously, we went through a period of a little bit better contracting, not fully reflecting the inflationary environment, but some of it. Where are we and what's sort of your visibility in terms of the outlook for the next 1 to 2 years?
Steve Filton
Executive VP, CFO & Secretary
Yes. So I would answer this question or I answered this question a bit of a caveat in the sense that I think that contractual pricing in my mind continues to look, I'm going to call it, positive or solid. And I know that's a value term in and of itself. But yes, I think we're seeing commercial contractual pricing, meaning our new contracts or annual increases in our new contracts are in that 4% to 5% range, which I think is generally where we would expect.
What I think people don't focus on as much or maybe because it's a little more difficult to focus is I think where we find our revenue per unit per adjusted admission per adjusted day, however you want to look at it, impacted more than the contractual pricing is through what I'll broadly describe as payer behavior, what payers are doing in terms of denials and nonpayment and delays, et cetera. And to be fair, I don't think that behavior has changed dramatically in the last year. I think it changed some coming out of the pandemic as payers became more aggressive after having been less aggressive during the pandemic. But not so much. But because there's been so much happening in the managed care space, there's been a lot of speculation. And I think you probably know, Jamie, both ways, sort of some speculation that payers would be less aggressive because of some of the focus on their behavior, et cetera, and some speculate that they'd be more aggressive because their profits and they're on the laws, were under some pressure, et cetera.
So like I said, even today, we haven't seen a great deal of change in that behavior and nothing that I would point out is affecting our growth in pricing in any sort of significant way. But something we watch very carefully, something we're very focused on and spent a great deal of time and resources on.
Jamie Perse
Goldman Sachs Group, Inc.
Okay. And just on acute care margins, you've talked a lot about getting back to the 16% to 16.5% margin for that business. Profitability really started to ramp in the first quarter of last year and very much continued into the first quarter of this year. Given the balance of inflation, patient mix, reimbursement and some of the factors we've talked about today, DPP, what's your level of confidence in getting back to that level? And any thoughts on timing?
Steve Filton
Executive VP, CFO & Secretary
Yes. I mean, again, as you pointed out, we've made a lot of progress in the last, let's call, 1.5 years or so, and that momentum seems to be sustainable for the reasons that I talked about that even relatively, I'll call it, modest top line growth in that 5%, 6%, 7% range is generating continued margin expansion in an environment where we're in a better position to control costs. That looks like it's going to continue. Of all the things that you mentioned, labor is better controlled. We ultimately like to think that in the end, there won't be a huge impact from tariffs on our supply costs. So presuming that you mentioned DPP, we'll probably return to that when we talk about policy later, but assuming that those numbers remain relatively stable, Yes, I think there's a general sense that we can get closer to, if not back to pre-COVID margins on the acute side in the next 18 to 24 months.
Jamie Perse
Goldman Sachs Group, Inc.
Okay. Great. Let's move on to the behavioral business. Starting with volumes, you've obviously had a lot of questions on this, just given the volume trajectory, which has been a little bit slower than I think you and us externally had imagined. You've been pretty kind of same level of conviction that you can get back to this 2% to 3% volume trajectory. What underpins that confidence?
Steve Filton
Executive VP, CFO & Secretary
I think that our sort of confidence as you described it in the -- our ability to get back to sort of 2.5%, 3% volume growth, which historically has been a relatively sort of modest volume growth level in the behavioral business is really based on kind of two broad perspectives on the market. One is, I'll call it, internal or micro, which is our own experience. The amount of incoming inquiries we have from patients, from referral sources, about patient need and placing patients, et cetera. And we have found in the last couple of years is that we haven't always been able to meet all those needs for a variety of reasons, probably most notably staffing constraints where we had available beds or available capacity, but didn't necessarily have the appropriate number of nurses or the appropriate number of therapists or the appropriate number of mental health technicians or aids to treat those patients and therefore, had to defer certain admissions or to deflect certain admissions.
We believe that over time, that dynamic has gotten better. If you look at last year, 2024 is dynamic, patient day growth was getting better throughout the year until very late in the year. And so that's one perspective. And the other is just the outside perspective that to the degree that there are industry-wide metrics available on diagnoses and incidents of mental illness and the need for mental health treatment, all those metrics seem to be growing and really across the board, meaning across diagnoses, across ages, across payers, and so again, the general sense that we have is the onus is on us to solve the issues that have been preventing us from taking all those patients, mostly labor scarcity, sometimes the physical availability of beds, sometimes the acuity of the patients that are being asked to be treated.
All those things are things that we should be able to deal with over time. I think you said I was very emphatic about being able to get to the 2.5%, 3% growth, patient day growth this year, maybe too emphatic. What I did also add, however, was, if we didn't get to that volume growth, I thought we'd still get to our targeted revenue growth and again, the mid-single digits by virtue of the strong pricing that we've continued to experience.
Jamie Perse
Goldman Sachs Group, Inc.
You've made some comments recently just about the strong pricing in the market and that attracting more competition. How does that factor into your ability to get back to that trajectory?
Steve Filton
Executive VP, CFO & Secretary
Yes, that's a part of it. I mean, the reality is because I think there is a healthy demand environment in behavioral, because I think there is a healthy pricing environment, both in terms of contractual pricing with payers and some of the more recent Medicaid supplemental programs that some states have implemented. We've seen an increase in competition and new entrants into the market. Particularly, I think we've made the point, I think, in our last couple of earnings calls on the outpatient side of the business, we historically have had, I think, a fairly significant SKU and focus on inpatient care. And I don't need to be perfectly candid. I don't know that we've got our, I'll call it, fair share, again, sort of a value judgment word, but our fair share of that incremental outpatient business, of which I think there's a significant amount.
I think we're correcting that, both in terms of tightening up our own policies and procedures to make sure that the patients that are in our facilities and are being discharged into outpatient programs are being discharged into our own outpatient programs where clinically appropriate and also though capturing the what we call the step-in outpatient business in this industry, and these are patients who are entering the behavioral system, not on the inpatient side of things, but on the outpatient side, they may never need inpatient care, although some of them probably will. And that, which is really more of a freestanding facility, freestanding outpatient facility business is a business that we have not played in, in a very significant way historically, and I think are increasing our footprint there pretty rapidly.
Jamie Perse
Goldman Sachs Group, Inc.
You mentioned labor being one of the bottlenecks in this. If I look back the last 2 years, salary wage and benefits in the behavioral business are up likely 14% versus admissions down. I realize that's like picking a very specific time period and you don't have numbers in front of you, but just roughly speaking, how much of that is added unit cost per nurse or whatever versus increased headcount that can allow you to absorb more capacity?
Steve Filton
Executive VP, CFO & Secretary
Yes, I think it's a combination. Obviously, and I alluded to this a little earlier, one of the dynamics that I think almost all subacute providers experienced during the pandemic behavioral home health, skilled nursing, nursing homes experience was they were losing nurses, in particular, but potentially other clinicians and employees to the acute care setting where they were able to make significant premiums on their pay. I think that nurses in the acute care setting have always historically made more than nurses in a subacute setting.
But that difference and that gap widened considerably during the pandemic. And I think what you saw coming out of the pandemic is that some acute providers writ large, including us as behavioral providers, were readjusting our salary structures to be more competitive in that regard. So I think that's a piece of what you're seeing. And then some of it is also, as you point out, we're staffing up and that takes some time. And so for a period of time, what we're -- what you're going to see, I think, reflected in our financial statements is a lot of cost of new hires, which essentially is nonproductive cost.
You were talking about salaries and then admissions or revenue. And so in the beginning, when we hire new nurses and new techs, et cetera, there's a period of time depending on their experience, in particular, where we're training them and orienting them. And again, in some cases, if they're new graduates or really have no experience in the behavioral industry, we could be training them for months at a time and so you make this investment in salaries and wages that then is not being reflected in revenues and profits for a period of time.
Ultimately, we think it's the right investment, particularly if we can control our turnover rates and reduce turnover. That's another way of sort of increasing the effectiveness of that investment. But yes, I think that's also some of what you're seeing in the data that you're citing to me.
Jamie Perse
Goldman Sachs Group, Inc.
I think that dynamic is tied to this next question as well, but you've added 140 beds in the behavioral business in 2024. You go back a few years, that was like 300, 400. I guess what do you need to see in the labor markets and otherwise, to get back to a more aggressive cadence of new bed growth in behavioral?
Steve Filton
Executive VP, CFO & Secretary
Yes. So it's an absolutely valid observation that we slowed our bed additions, again, during the pandemic, the argument being if we couldn't staff the beds that we already had, what was the point of building new beds and to your point, I think now that we've emerged from the worst of those labor shortages and this really is a market-by-market determination, but we've resumed a lot of that bed addition, bed building that had been paused during the pandemic.
Now again, there's time frames associated with that, permitting the actual construction time ramping up, getting those new bed staff, et cetera. So it takes some time. But to your point, I think over the next several years, you'll see the number of bed additions and new hospitals. We also have some new hospitals coming on. We just opened a new hospital in Michigan and I have a few more on the Board over the next few years. So you'll see both bed additions to existing hospitals and de novo facilities. More of those coming out in the next few years.
Jamie Perse
Goldman Sachs Group, Inc.
Okay. And then pricing has obviously been very strong in this business. I think 3 of the last 4 years was 6% or better been more of the mix of that 5% to 7% algorithm and this business has been pricing. Is there a point we reach a new equilibrium? How sustainable is this kind of trajectory in the near? And as you think about the next couple of years, again, do we reach a new equilibrium that's a little lower than you've been seeing lately?
Steve Filton
Executive VP, CFO & Secretary
So we've argued, I think, for the last several years that there is this sort of interplay between pricing and volumes. And to some degree, the reason that we've been able to achieve, I'll call it, outsized or certainly larger than historical pricing levels, is the very lack of capacity that I've been talking about on the volume side of things. So that's been a headwind for us on the volume side. But the flip side is, as payers struggle to sometimes and in some markets, find adequate access and capacity for their subscribers and their patients, I think they're willing to pay a higher rate to be in network and essentially to be assured access to facilities in the market and to beds in the market and outpatient capacity, whatever it may be.
And so yes, we know -- again, I think what we've seen over the last several years is this lower than historical volume growth and higher than historical pricing. And I think what we've argued is that using your term that there would be, over the next few years, more of an equilibrium that pricing would start to moderate as volumes came up. And the truth of the matter is, as I think you commented in an earlier sort of question or commentary was, it's been a slower process than we originally imagined. Volumes have been slower to recover back to historical levels than we might have imagined and expected and I think even guided to. But at the same time, I think pricing has remained strong. And again, our long-term view or I'll call it, intermediate and long-term view is that pricing will moderate some volumes will come up. I think at the end of the day, in combination, we're still going to be tracking that sort of mid-single-digit same-store revenue growth that I talked about earlier in that kind of 6%, 7%, 8% range.
Jamie Perse
Goldman Sachs Group, Inc.
Is there a way to sort of measure that on a micro basis just in terms of number of payers you're able to give in network contracts to and kind of guarantee that supply and the number who are on the outside that would like more supply and just better gauge where we are from a supply-demand balance perspective?
Steve Filton
Executive VP, CFO & Secretary
Yes. I mean the answer, of course, is yes. I mean we could say these are the number of contracts -- I don't know off the top of my head, by the way, but these are the number of contracts that we've renegotiated in the last several years at a 4 or 5-plus percent annual increase greater than we might normally have, et cetera. And then I think sort of the question I get asked, which I think is kind of where you're going with your question is, well, how much more runway is there? What inning in this game are we in? And that's hard to say.
As I said, I mean, I think the reason the pricing has been more sustainable and has endured more is because the volumes have been challenging, not just for us, I think, but for the industry in general, and capacity is somewhat limited, et cetera. So I think it's a little bit hard to say again, how far along in this process we are, but again, I'm going to say our intermediate long-term view is the equilibrium that you kind of talked about in your question is something that will occur over the next several years.
Jamie Perse
Goldman Sachs Group, Inc.
And then maybe just closing out behavioral. EBITDA margins have been in kind of the upper end of their historical range the last couple of years. Putting these factors together that we've discussed today, I mean, how are you thinking about where margins go from here, is the 22, 23 type of level sustainable? Do you expect margin improvement? Any color there?
Steve Filton
Executive VP, CFO & Secretary
Yes. I mean I think that the historical model for the behavioral business -- and by the way, I think it's very similar to the acute business, as we talked about is if you can achieve that mid- to upper single-digit revenue growth in behavioral, we've been talking 6%, 7%, 8%, let's call it, 7% at the midpoint, which would be 4%, 4.5% price 2%, 2.5% patient day growth or just the patient day growth, then it's unlikely that your expenses will be growing faster than that. And for the best sort of history of the business, they have not. Now again, the pandemic was an exception when all of a sudden, salaries were growing much faster, and we were having to pay for temporary traveling nurses and sign-on bonuses and all sorts of recruitment incentives, et cetera. But all those things have largely either completely disappeared or moderated significantly. And so the notion is, yes, as long as we can grow the revenue side of the business in that 6%, 7%, 8% range that yes, there's still room for margin expansion.
Now to be fair, some of that margin expansion over the last several years, particularly in behavioral has come from these Medicaid supplemental payments. We may touch on that in the last minute or so, those programs likely not to continue to grow in the future as an industry. I think the hope is that they'll be at least sustained at something close to current levels, but that plays a part in this as well.
Jamie Perse
Goldman Sachs Group, Inc.
Yes. Well, I'm glad we were able to focus on fundamentals today. But in the last minute or so, any updates on DPP. I think your latest is the existing programs would be protected. You're waiting on some approvals in Tennessee and D.C.
Steve Filton
Executive VP, CFO & Secretary
Not really. I mean, obviously, the reconciliation bill is now with the Senate. I think there's a lot of lobbying being collectively done by the health care or hospital industry in general, the behavioral industry, the acute industry in terms of sort of firming up the language and trying to ensure that existing programs and programs that have been submitted and awaiting approval are included in the grandfathering provisions that the grandfathering provisions which say they basically their grandfathering existing terms are very specific to what those terms are, the tax rates, average commercial rates, all those sort of things.
As you know, there's a lot of sort of back and forth with the Senate. They may not have the exact same goals as the House, we're not sure how that will play out.
Jamie Perse
Goldman Sachs Group, Inc.
Okay. I'm going to squeeze one last one in here. You previously gave a $50 million to $100 million number for enhanced ACA subsidies, if that went away for next year. given some of the moving parts there, so is that still the right way to think about it?
Steve Filton
Executive VP, CFO & Secretary
Yes. And I would say we were at the lower end range. And to be fair, that was a guesstimate because there are a lot of sort of assumptions and variables that go into that. But yes, we were in that sort of $45 million, $50 million estimate range.
Jamie Perse
Goldman Sachs Group, Inc.
Okay. Great. Thanks, Steve.
Steve Filton
Executive VP, CFO & Secretary
Jamie Perse
Goldman Sachs Group, Inc.
