Surgery Partners, Inc. Presents at J.P. Morgan 42nd Annual Healthcare Conference 2024, Jan-08-2024 02:15 PM Summary

The following is excerpted from the question-and-answer section of the transcript.

Question: Lisa Christine Gill - JPMorgan Chase & Co, Research Division - Analyst : Let me start first with utilization in the fourth quarter. Can you talk about any notable shifts in utilization cancellation rates? And I think also just kind of piggybacking off of that, I think there's still this debate of is there pent-up demand in the marketplace?

Question: Lisa Christine Gill - JPMorgan Chase & Co, Research Division - Analyst : Then as we think about 2024, right, and we think about utilization in '24, you talked about the different service lines as we go into 2024. Just given the acquisitions that you've made, should we see anything different in utilization of those service lines in '24 versus what we've seen, say, in '23?

Question: Lisa Christine Gill - JPMorgan Chase & Co, Research Division - Analyst : I appreciate that. And I appreciated the pre-announcement this morning even though it was very early for me. And at least $495 million of adjusted EBITDA growth in 2024. What are the key items that are going to drive that growth next year when we think about that? It's roughly 13% off of what consensus numbers are today. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JANUARY 08, 2024 / 10:15PM, JPM.N - Surgery Partners, Inc. Presents at J.P. Morgan 42nd Annual Healthcare

Question: Lisa Christine Gill - JPMorgan Chase & Co, Research Division - Analyst : And as we think about contributions from things like de novo facilities, right, you talked about 17 de novo facilities. How do we think about the margin on de novo facilities and the impact that, that will have? Because I would think that those margins are going to be lower, right, than your core book of business, and then it will improve over time?

Question: Lisa Christine Gill - JPMorgan Chase & Co, Research Division - Analyst : Eric, you mentioned construction, right? And construction cost inflation have all increased. Does that change the trajectory of profitability on these?

Question: Lisa Christine Gill - JPMorgan Chase & Co, Research Division - Analyst : And you talked about your capital structure and Bain Capital, your largest shareholder, recently completed a private secondary offering. Recognizing this was Bain's decision, can you maybe just talk through the understanding and the rationale of doing a transaction in this way?

Question: Lisa Christine Gill - JPMorgan Chase & Co, Research Division - Analyst : You also -- in December, you refinanced $1.4 billion of a term loan. I think you brought that up in the presentation as well. Can you speak to the process, the outcome and what you have left to address when we think about any kind of refinancing risk? I think you said there's nothing until 2025.

Question: Lisa Christine Gill - JPMorgan Chase & Co, Research Division - Analyst : When we first started talking 2.5 years ago, we talked a lot about your managed care contracting and where you are in managed care contracting. And I think on the last quarter's call, you talked about 90% of 2024 is locked in on managed care contracting. But when I think about the relationships longer term, can you maybe talk about where you are today on that trajectory from getting the managed care contracts to where you really want them to be? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JANUARY 08, 2024 / 10:15PM, JPM.N - Surgery Partners, Inc. Presents at J.P. Morgan 42nd Annual Healthcare

Question: Lisa Christine Gill - JPMorgan Chase & Co, Research Division - Analyst : And I know we don't have a lot of time left together. But if I think about the opportunity in the shift of procedures to ambulatory surgery from inpatient only, I know you talked a little bit about that today in the presentation, but is there something that you expect to see a shift in 2024?

Question: Lisa Christine Gill - JPMorgan Chase & Co, Research Division - Analyst : Great. I loved your comment of value-based care in the fee-for-service world. I couldn't agree more to this idea of shifting to the lower site care -- cost of care. But thanks very much, everyone, for joining us. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JANUARY 08, 2024 / 10:15PM, JPM.N - Surgery Partners, Inc. Presents at J.P. Morgan 42nd Annual Healthcare

Question: Lisa Christine Gill - JPMorgan Chase & Co, Research Division - Analyst : Thank you so much. I got my next one at 3:00. So good to see you, guys.