George Hill: Yes. Good morning guys. I kind of have a follow-up on Jailendra’s line of questioning, which is on the market macro backdrop. And with the onboarding of Providence and the acquisition of Acclara, has this kind of increased or decreased is at the sales funnel looking forward? And how are you guys thinking about capacity as it relates to whether this is attracting more business interest or like or potential clients seeing this is like, as you guys is the safe place to go down or are people worried that you guys have a lot on your plate, just kind of be interested in the sales pipeline in the sales model. Thanks.
Lee Rivas: George, short answer is no impact. Short-term in nature on the pipeline, modular pipeline, we are still seeing plenty of opportunities and increases in some areas like AR and denials. And same on the end-to-end pipeline, we are feeling very good about what’s happening there, seeing many or several medium, small and medium-sized systems. We are very active in discussions across the board there. So, no changes across if anything, that just heightens the awareness of needing good partners that can deploy technology and services. And I would also add, George, on your Providence question. Look, these are separate teams, very focused teams, no impact to onboarding Providence or integrating Acclara.
Operator: Your next question comes from the line of Jack Wallace from Guggenheim Securities. Please go ahead.
Jack Wallace: Hi. Thanks for taking my questions. Jennifer, I just want to make sure that I have got the net impact first quarter EBITDA correct. And then give me an opportunity to tell us just how much outperformance there looked under the surface. So, if I recall correctly, first quarter EBITDA is expected to be down about $20 million quarter-over-quarter related to some of the transactions we discussed. We are only down about $16 million, that also included what, $9 million or $10 million of change. So, are we right to under the circumstances about $13 million or $14 million of EBITDA beat in the quarter?
Jennifer Williams: We did have a good quarter with our core business. We also – and I alluded to it in the prepared remarks, some of our first quarter favorability was driven by timing of the investments on the Providence onboarding. So, there are some one-time costs that we incur on onboarding related to things like technology licenses and some other technology costs that we expect will come in Q2 and Q3. So, some of that is timing, but we did have a great quarter.
Operator: Your next question comes from the line of Michael Cherny from Leerink Partners. Please go ahead.
Michael Cherny: Good morning. Thanks for taking my questions. And I apologize if I missed this, but did you give any update on Sutter either in the current ongoing onboarding process, or how are you thinking about the changes in management there, what it means for Phase 2?
Lee Rivas: Thanks Michael. I will take that. I would say this is a very important customer, another West Coast customer that we won several years ago. Broadly performing well, like any customer, there is always opportunities for improvement as we manage an important part of their business. I would think of what you have called Phase 2 as like with many of our end-to-end customers an opportunity going forward.
Operator: Your next question is from the line of Sarah James from Cantor Fitzgerald. Your line is open. Sarah, your line is open.
Sarah James: Yes. Sorry about that. Is there an opportunity to cover some of the switching costs with – related to change to other vendors through business interruption insurance? And are those changes of vendors permanent? And then if you could give us any color on the seasonality of impact of change to net operating revenue. Thanks.
Lee Rivas: So, Sarah, first part of your question, I don’t want to give any specifics, but clearly, we, like many other companies are pursuing different options regarding insurance. The second part of your question is an important one, we, going forward, will never be single-threaded through any one technology on a large use case, whether it’s clearing house or otherwise. I would think of this as us diversifying our base of options regarding this area. Some of those will be more permanent than others. But for the most part, any of our customers will have multiple options and deploy not just one for this use case.
Jennifer Williams: And then on your last question related to the timing of base fees, we really think it will be a large impact fluctuation and shift in timing between Q3 and Q4 base fee revenue, probably in the range of somewhere between $25 million to $30 million.
Operator: Your next question comes from the line of Daniel Grosslight from Citi. Please go ahead.
Daniel Grosslight: Hi guys. Thanks for taking the questions. More of a macro question on my end and really about the managed care environment, particularly given some difficulties in Medicare Advantage. I am wondering if some of those headwinds that Medicare Advantage faces in 2025 and possibly beyond, if that’s going to cause, do you think an increase in utilization management tools? And how may that impact collections on your end and incentive fees on your end? And then I guess longer term, how may that drive demand for some of your more modular solutions?
Lee Rivas: Yes. So, it’s a great question. I would say pretty balanced across the board on the macro outlook. So, I love the last part of your question. It does drive demand as some of our customers deal with the nature of payment timelines with MA and some of the technologies they will deploy on the reimbursement side. Some of our customers do have reasonably reasonable sizes of their population on MA. And look, if anything, just to emphasize the importance of having a technology partner that can be as proactive on driving revenue yield and reducing costs. So, pretty balanced across the board. No major changes over the last year plus, Jennifer and I have seen while we are definitely watching that trend going forward. Anything to add, Jennifer?
Operator: Your next question comes from the line of Jeff Garro from Stephens. Your line is open.
Jeff Garro: Yes. Good morning. Thanks for taking the question. I wanted to ask more on the demand environment. And certainly recognize that the business model is evolving, and you guys don’t want to tie yourself to end-to-end NPR targets and also appreciate all the discrete examples of booking success. But want to ask if there is any way you could quantify your booking success or the progression of opportunities through the pipeline or just otherwise support your confidence in the medium-term revenue growth outlook? Thanks.
Lee Rivas: Jeff, I will just touch at a high level on the demand environment. So, I will go a bit deeper on what we have said, meeting providers where they are in the revenue cycle journey. We believe we have the most comprehensive set of capabilities of solutions, whether you want a fully managed deal or on the other spectrum, have us help you drive revenue that you would not otherwise be able to find based on this coding errors, lack of availability of resources to deal with denials or analyze claims that may have been underpaid. And in the middle is what we are calling our managed services or functional partnerships, and we are seeing plenty of situations where it is better for us and better for the potential customer to go down the path of using our people, our technology, our IP offshore to accomplish a task while having the customer manage – still manage the revenue cycle.
So, we see good demand across the board. On the end-to-end side, as I have said, a strong pipeline of medium-size systems that would look to do a fully managed deal. And on the other spectrum, on the modular side, still see very strong demand, where I am seeing – where we are seeing it the most is still on the underpayments optimization area. We see plenty on the denials and AR side. We are seeing demand for physician advisory solutions and continued demand on the coding accuracy side. So, we see strong demand across the industry in a time where we believe providers need it the most.
Operator: Your next question comes from the line of Richard Close from Canaccord Genuity. Please go ahead.
Richard Close: Thanks for the questions and good job helping out all your clients in a hard time here. Jennifer, you mentioned the bankruptcy in your comments on the modular revenue in the quarter. I was wondering if you could provide a little bit more details there. And appreciate the $45 million for the full year that you referenced. But I am curious how you are thinking about the bankruptcy and the impact on your business going forward longer term?
Lee Rivas: Richard, if you don’t mind, I am going to start, just kind of give a little context and hand it over to Jennifer. This is an important customer for both Acclara and Cloudmed, long-standing customer on both sides. I am personally familiar with and our Acclara teams are very familiar with. Multiple solutions sold on both sides. This is a customer that has highly valued the combination of technology, global scale and the solutions we have. They have filed for bankruptcy. As you know, we are committed to helping them through this as we have helped others in similar situations. So, we feel very good about the work we will do for them going forward. Jennifer?
Jennifer Williams: Sure. So, I mentioned in the remarks about $45 million is what the annual revenue is across both pieces of the business, Acclara Solutions and Cloudmed Solutions for this customer. With that said, in the first quarter, we did not recognize any revenue that was not collected. So, we have received cash payments for all the revenue that we recognized in the first quarter. And any of the outstanding AR that we had on the books is fully reserved at the point that they filed for bankruptcy this week. So, there is no exposure from a balance sheet perspective based on the outstanding receivables. This is the same customer, as you may recall from prior earnings calls, where we took a reserve in the latter part of 2023, based on financial challenges we knew this customer had.
