Matt McKee: Yes, Bill over the past 12 months, really, there’s been a number of fees based wins, and some of those states are high density states for us with respect to our client facilities. You think about Florida, Illinois, Pennsylvania more recently, Texas and Ohio. And there’s variability there, right. I mean, although one may classify a reimbursement increase in a particular state as a win, there’s degrees, right, for instance, the state of Ohio just had a pretty substantial dollar PPD increase that was above what was expected, Ohio historically has not been the best state from an operating perspective. You contrast that with Texas, that did in fact get an increase, but it was I’ll say less than what operators were hoping for, it’s been quite some time.
Since the state of Texas did, in fact, get an increase. So you could put that on the board, technically, as a win and that it was an increase that providers were able to secure but still deemed insufficient. Another state would be New York, which was a bit mixed, where there was 6.5% reimbursement rate increase. That was a bit higher than what was initially proposed, but certainly sub what the industry was looking for in light of massively increasing costs for operators in that state, and really quite a lag in time from the prior reimbursement rate increase. So it’s a mixed bag, and certainly something that we pay attention to, Bill, at the state based levels and from an overall regulatory and reimbursement based perspective, but much more important for us, obviously, is how that trickle down and impacts the facility and the operator.
So it’s one component of that overall financial assessment, inclusive of occupancy, payer mix, and how they’re able to staff and manage their nursing departments as well. And the effect that has overall on occupancy.
Bill Sutherland: Okay. I noticed housekeeping revenue was down just a bit quarter-on-quarter. Is that a couple more exits involved there? I’m just curious about the renewal rate.
Matt McKee: Yes, that’s right, Bill, we would — we did exit some business. We would classify that as more normal course exits. So nothing substantial, the full run rate of which was reflected in the quarter. While we’re talking about the segment level revenue, I would note that dining, we saw a bit of a step up there. And that was just a couple of new business ads. Again, nothing substantial. So both the housekeeping exit and the dining ads, really, were fully reflected in the run rate revenue for the quarter.
Bill Sutherland: Okay. And are your contract, the expansion that you’re getting in education, you’re reflecting in the overall numbers. Is that right?
Matt McKee: That’s correct, Bill, they’re reflected, respectively in housekeeping and laundry, and then also dining segment as well.
Bill Sutherland: Okay, and there, is that part of the back half uplift?
Matt McKee: It is. That’s correct.
Bill Sutherland: Okay. And then last one, you mentioned doing least $30 million in free cash for the full year, that’s still look like the right way to think about it.
Matt McKee: Yes, I think looking to the back half of the year, specifically, we’re still targeting that $25 million to $30 million range. So depending on where we fall in that range, or if we exceed that range that could obviously have an impact on the number you just shared, but $20 million to $30 million is our back half of the year target for no free cash flow.
