We opened 35 de novo centers and will continue to intentionally moderate our pace of openings with an expectation of no more than 20 de novos in 2024. Finally, we made tangible progress in standardizing and streamlining the business including moving to a single EHR phone system, KPI suite, and online booking tool, as well as creating a single operating model for our regional support teams. Looking ahead to 2024, there is no shortage of opportunities for improvement with many new initiatives unlocked by the work done in 2023. Delivering an amazing patient and clinician experience remains a top priority for us. I’d like to take a moment to discuss three tangible examples of how we are going to do this while also generating operating leverage.
First, we are continuing to invest in the front office of our centers, focusing our resources on those areas of support that most directly impact the experience of our patients and clinicians. We are increasing our center staffing levels over 25% by year-end and redesigning our processes to better support our patients, clinicians, and administrative support teams. Second, we are making improvements for new patients booking by the phone. We are rolling out a new phone booking tool that leverages the matching capabilities of OB, our online booking tool. This will further enhance the patient-matching experience while significantly reducing complexity and increasing the speed of scheduling over the phone for our intake team. Third, we are piloting a new digital patient check-in tool that will allow us to collect and verify patient information upfront as well as allow patients to pay their balances more easily.
This will reduce stress for our patients and manual complexity for our operations and billing teams. We are doing all three of these things while also meeting our commitments to margin expansion in 2024, demonstrating that delivering improved patient and clinician experiences while also delivering improved operating leverage can be accomplished simultaneously. I’m proud of what our teams have accomplished over the past year and am equally excited about the opportunities in front of us in 2024 and beyond. I’m also particularly proud of the strength of the leadership bench that we have built, which delivered on our commitments for the full year 2023 and will be instrumental in leading the long-term profitable growth of the business. With that, I’ll turn it back to Ken for his closing remarks.
Ken Burdick: Thanks, Danish. In closing, I am encouraged by the progress made in 2023. We remain focused on operational improvements, profitable growth, and disciplined capital deployment. Our 2024 guidance reflects the strong positive momentum of the organization, and we look forward to continuing to invest in the patient and clinician experience while at the same time delivering margin expansion. In particular, I am thrilled that we expect to achieve the important milestone of positive free cash flow for 2024. Along with Dave and Danish, I offer my thanks and appreciation to our 9500 colleagues who demonstrate their dedication to our vision, mission and values in the work they do every day. It is due to their collective efforts that we have made significant strides toward realizing LifeStance’s potential. Operator, please open up the line for Q&A.
Operator: Thank you. [Operator Instructions] We’ll go first to Craig Hettenbach at Morgan Stanley.
Craig Hettenbach: Great. Thank you. Ken, despite the comments of improved track record that you’ve seen in the last five quarters, there’s still some noise out there in terms of clinician turnover and growth. So I’d love to get your take in terms of things you’ve done to kind of steady the ship and expectations going forward on those metrics.
Ken Burdick: Sure. I’m going to let Danish respond to the clinician turnover. Generally, what I would say is obviously, we posted a strong fourth quarter. And as Danish, Dave and I have all said in our prepared remarks, there’s plenty of work that remains to do. And I’ll let Danish perhaps elaborate on some of his comments as it relates to clinician growth and retention.
Danish Qureshi: Sure. Hey Craig, so in terms of clinician retention, it continues to remain stable. We have wins throughout 2023 and feel really good about what we’ve been able to accomplish there. But as I indicated in my prepared remarks, we are continuing to focus on enhancing our value proposition to our clinicians through the way that we are investing in the practice group, things like I mentioned around increasing our front office staffing to have a very tangible and direct feeling of support for our clinicians across the country as one specific example. But as indicated by our net clinician adds of over 1,000, which we’re very proud of, our ability to both attract and retain clinicians remains strong. We continue to be able to do that despite moving to what has essentially been for the last three quarters, 100% organic and delivered net clinician ads above 2022 while moving towards 100% organic strategy. So all in all, we feel great about where we’re at today.
Craig Hettenbach: Got it. And then just a follow up question for Dave, just on operating leverage. I know whether it’s footprint consolidation, payer consolidation, there’s a number of things at play. But this year in particular, are there any that you would single out in terms of that’s going to be important for you to deliver upgrade leverage and then maybe as you go into 2025, does that look the same or different things that come into the fold?
David Bourdon: Craig, it’s Dave. I think I got the gist of your question, which was focused on operating leverage. You were cutting out pretty bad. As far as the operating leverage, yes, we’re guiding to improvements in operating leverage in 2024. I mean 1 of the ways we’re doing that is if you look at our Q1 guide and our full year guide on G&A, it’s pretty flat throughout the year. And the way I explain that is, in the first quarter you’re going to get a pop up in G&A as a result of the resumption of the payroll taxes. And then as that goes away in the subsequent quarters, it’s being replaced by some of the investments that Danish talked about, digital check-in tool and things like that. But having said that, we’re able to keep G&A spend relatively flat because of the efficiencies that we’ve been working on as we’ve been strengthening and fortifying the business.
So we feel really good about the margin expansion that we’re seeing both in the bottom line as well as incentive margin for 2024.
Craig Hettenbach: Good. Thanks for that.
Operator: We’ll move to our next question from Lisa Gill at JP Morgan.
Lisa Gill: Thanks very much and good morning. Ken, I was wondering if you could give us an update on where you are in the managed care payer check-in strategy. How much is left to be done here in 2024? And then when I look at the revenue per clinician, I think you talked about rates getting better in the fourth quarter and holding some claims until the fourth quarter. How do I think about that progression of revenue per clinician going into 2024?
