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.
Operator: Our next question comes from the line of John Ransom of Raymond James.
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?
John Kao: 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. 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.
John Ransom: 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?
John Kao: 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. 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.
Operator: This question comes from the line of Kevin Fischbeck of BofA.
