Danish Qureshi: So, this is Danish. I will take that. So, some of them are within the same states or markets that the initial 36 may have had and we may have had closures in. Others are in new markets. The way that we looked at this was, with the initial 36, that was sort of what I would characterize as the obvious closures. They were all acquired locations that were suboptimal in either the footprint, the layout, the quality of the build, and most importantly, the in-person utilization of the space. With this next go rounds, it’s looking more broadly to say, these centers may not check every single box, but there is a compelling reason. The largest one being in-person utilization and proximity to other centers where we can consolidate some of that visit volume and both patient traffic and clinician workspace.
So, it’s a mixed bag to answer your specific question, which is, in some cases, they may be brand new markets that were not part of the initial 36, in other cases, that may occur in the same market.
Operator: Next question comes from Kevin Caliendo with UBS. Your line is open.
Kevin Caliendo: Thanks. Thanks for taking my question. You mentioned you are sort of two quarters into a two year plan here in terms of updating, improving operations. I know a lot of the heavy lifting is done. But maybe can you talk about some of the initiatives you have going forward. And are those, again, to be margin enhancements, operational enhancements, revenue enhancements, all of the above? Just love to hear a little bit more detail on what you could share at least with sort of the next 18 months of this plan?
Ken Burdick: Sure, Kevin. This is Ken. I want to be really clear. While we are pleased with the progress, we literally are only a quarter of the way through. There is two year investment phase where we have every intention of fortifying the foundation so that we can continue to build and grow a strong company. So, none of us at LifeStance would decide — would declare that the heavy lifting is done. We are — there is plenty of heavy lifting that remains over the next 18 months. Having said that, I view the progress as solid and steady, but we are far from declaring victory. To the second part of your question, it really is all of the above. The work that we are doing is going to improve our operational performance. That will drive improved administrative costs, operating leverage, if you will.
But we are also doing things that will improve revenue. So, it’s across the Board and that’s why we talk about it as transformational because we are taking an incredibly high growth business, and we are taking just a bit of a pause to invest for two years so that we have a rock solid foundation upon which to grow going forward.
Kevin Caliendo: A quick follow-up, if I might. Are you in terms of demand for services or patient traffic or the, like, are you finding that just being in network is enough to fill your schedules or is there any additional outreach that needs to be done advertising and the like? Just sort of trying to understand the dynamics of where demand is currently and where you think its heading?
Danish Qureshi: Hi, Kevin, this is Danish. I can take that. So, in general as a starting point from an industry perspective, patient demand outstrip supply. So regardless of LifeStance in general, we are all positioned well just based on the overwhelming demand for mental health services across the country.
