Christopher Reading: Yes. If I was in the predict what Medicare CMS is going to do business. I probably need a couple more jobs. So I’m not sure exactly. I think we get out of the system that we’re in completely in 2026. We were actually just a big group of us in D.C. Now it’s been 3 weeks ago. We had a meeting at the White House, meeting at HHS. We met with the head of AARP, the regulatory head. We met with a couple of consumer-facing groups. We have a bill right now on fall prevention. There could be some additional directed volume for us. And we met with MedPAC. And I would say the MedPAC meeting was the meeting where we’ve got more opportunity to help educate them their original calculations with respect to the physician fee schedule as it impacted us was based on a misunderstanding of the code set under which we bill.
In short, they were trying to cut the reimbursement to what they thought were the highest income level of physicians across their fee schedule — physician fee schedule, so included physiatrists, pain management doctors in some cases, orthopedic surgeons, portions of our code set, but we make up — physical therapy makes up 85% of that code set. And again, physical therapists making somewhere in $70,000 to $90,000 a year range, and they had no idea of that. And yet their recommendation to CMS was to cut because they thought they were knocking these highly compensated physicians back, and we ended up being what they called collateral damage that mistakes don’t get fixed quickly in Washington but we’ve got good line of communication. We’ve got better data over a period of years with studies and other things that we’ve done on how much physical therapy saves the system when entered and accessed on a primary care basis, really physical therapy first for muscotoskeletal problems.
And so — while this isn’t an easy fight. I think it’s a fight where facts matter and facts and reasonableness on our side. We’ve just got to continue to drive home the message and and be more effective and more diligent with our dealing in Washington. It’s a little frustrating, but we’re committed to the whole industry with APTQI kind of in a leadership role now alongside the APTA, we’re very focused on making progress.
Larry Solow: Got it. I appreciate that that’s all interest. I guess just last question or this point. I just — I noticed that you had a net six closed or closed facilities. Is that just — is that — did you happen to accelerate on some underperforming facility closures? Or what’s sort of the outlook for net openings in 2024?
Christopher Reading: Yes. I think you’ll see us with strong openings similar to what we’ve done in the last couple of years, we’re having a good organic de novo opening schedule for the remaining part of the year. We’re in good shape through the end of April. And then we’re finding tuck-ins at very, very reasonable prices where we can fold those into strong existing partnerships. So we expect that to go well. The closures really are a result of just what we believe is a healthy pairing of facilities that have been around some of those for multiple decades. And at the end — at the end of their useful life, and the leases just happen to be up. And so they don’t carry with them a lot of closure costs. It allows us to focus efforts on where we can get the greatest return. It’s kind of like trimming of fruit tree you got to prune some branches to have more fruit at the end of the day. So that’s what we do. Timing is kind of no message there.
Operator: [Operator Instructions] We’ll take our next question from Mike Petusky with Barrington Research.
Mike Petusky: So on injury prevention, Chris, I think maybe 1.5 years, 2 years ago or so, you sort of express some caution hey, some companies are pulling back on these types of services, concerned about recession and all the rest. I mean do you feel like in light of the something you mean about demand improving. I mean do you feel like most of these executives have sort of somehow made piece with the economic backdrop? Or can you just speak to your sense of that?
Christopher Reading: Sure. Sure. Thanks, Mike. Mike, you know us, you’ve known us for on the entirety of the time I’ve been here 21 years now, and we tell everybody what we think and what we’re seeing and feeling and hearing and going into last year, we felt like we were seeing from the CEOs and CFOs who make these decisions in some sectors that they were anxious, and they were pulling back, not just with us, but with a lot of vendors in a lot of areas. We’re not feeling that right now. And while there may be individual sectors or companies that are still a little tepid relative to the interest rate environment. Look, I think people demand — consumer demand continues to be high. What’s in part driving some of the inflation that we’re seeing.
— employment still pretty good. And I think there’s a sense that the Fed isn’t going to run to the rescue anytime soon, and this is going to be the state of the state for a while. And we’re just feeling really good about what we’re onboarding. We’re seeing good opportunities. We’re winning some good fights. And I think you’re hearing what we think the year is going to look like, just like you heard last year that we thought things were going to be a little slower. So that’s just kind of where we are.
Mike Petusky: And then maybe for Carey or anybody should take this. In terms of the place you are and the multiyear effort to sort of get better more appropriate reimbursement from commercial payers. I mean, how much work there do you feel like is — I understand it will be ongoing for a while. But in terms of the heavy lift, what you really want to accomplish, how far into this do you feel like you are at this point?
Carey Hendrickson: Yes. I’d say we’re through about 2/3 of the initial heavy lift, if you will. But it’s — as you noted, it’s an ongoing effort. So when we get done with this, we’re just start right back over again and go through it. There’s always opportunities and we’re — so it’s a never-ending process. But we’re — I’d say from the initial lift, we’re probably 2/3 of the way through.
Mike Petusky: And then just, I guess, last question on just M&A. And Chris, I heard you say, hey, we’re seeing some really reasonable prices for some tuck-ins. And I’m just curious, in terms of the conversations you’re having, are there bigger sort of needle-moving deals out there where you would say, “Hey, there’s active discussions. The timing of it could come in 6 months. It could come in 2 years. But are there larger deals out there or larger partnerships out there that are looking for exit strategies and where you guys could be a reasonable option?
