Operator: Our next question comes from Whit Mayo of Leerink.
Benjamin Mayo: I know you guys are still going through the planning process for 2024, but I just wanted to sort of dial in to maybe some of the top strategic priorities you have for the behavioral health business that might be different than some of the initiatives in prior years? You’ve covered your labor agenda pretty well on this call and the progress — the small progress, I think, that you’re seeing there. But just anything else you’d call out, any organizational changes, anything that gets you excited or less excited about next year?
Steve Filton: Yes. I mean, so Whit, I think as we’ve discussed, obviously, staffing, recruitment retention remains a top priority and focus, and honestly, I think will continue to be for the foreseeable future. Like I said, I think we feel like we’ve made a significant amount of progress, but it continues to be a major focus because, again, I think we have a belief that to the degree that we can hire appropriate clinical personnel, particularly in very specific geographies, very specific hospitals. We absolutely have the ability to increase occupancy significantly. There are other initiatives, I think we have to increase occupancy. I think broadly, increasing occupancy is sort of the most significant opportunity we see in our behavioral business.
In a business where pricing has been strong, where I think what Q3 reflects is that cost controls have been improving. We’ve been reducing contract labor. We’ve been reducing over time. I think that increased occupancy is the most significant opportunity we had in [indiscernible] going forward. And I think we believe it’s a significant opportunity. Recruitment retention is a big way to get there, but we’re looking at broadening our continuum, focusing on certain service lines like substance abuse and MAT and telehealth and outpatient and broadening sort of the continuum of care that we already, I think, offer a pretty broad continuum of care, but broadening that even more and broadening our payer mixes that we reach out to, we have a pretty strong presence in both the active and retired military but I think have a number of initiatives to increase our penetration there.
So there’s a handful of important initiatives in behavioral. But all I think would fall under this umbrella of being able to increase occupancy.
Benjamin Mayo: Got it. Steve, just looking at the guidance, I know that you’re reiterating it, but my math, if I just apply very simple normal seasonality looking at the DPP program in Florida you can easily get to the high end of the range. And I know that you’re very respectful of the volatile operating environment, but just sort of anything that I’m missing or any refresh views as you kind of look within the range and kind of how you feel like you’re tracking next.
Steve Filton: Yes. I mean I feel like — and I will say that we don’t pay a great deal of attention to consensus estimates, but the last time that I looked at consensus estimates, I think they were sort of in the midpoint of our revised guidance. It seems like a reasonable target at the moment. I think as we’ve discussed on the call, in my mind, clearly, the two upsides for us, number one, as we just discussed, is if we’re able, over the fourth quarter to increase behavioral volumes and occupancy, I think that would be extremely helpful and create a significant amount of upside. And on the acute side, being able to push that pricing number up, recapture some of the sort of disputed amounts from our managed care payers, increased acuity, that sort of thing. So I think we’ve largely discussed what the upsides are and that if we were able to achieve those things, maybe we could get beyond where the consensus targets have us now.
Operator: Our final question comes from Joshua Raskin of Nephron Research.
Joshua Raskin: Just on the physician staffing costs again. Can you just remind us how much of the staffing may be for ED anesthesiology, how much of that is outsourced or if any of it’s in-sourced at this point? And then separately, how are your employee physicians performing? Is it really just an issue of specialists that we’re billing for specific out-of-network issues? Or are you seeing some of that internally as well?
Steve Filton: Yes. So first of all, for us, Josh, all of these contract services have historically been outsourced at least ER and anesthesiology. We have, in the last 3 or 4 months, brought some of those services in-house where we thought it made economic sense to do it, but historically, they’ve all been outsourced. I think it’s a very different dynamic. And I think again, it’s very specific to these house-based physicians, anesthesiology, ER being by far the highest ones. But we’re seeing it some in radiology, some in intensivist or labors or whatever. But clearly, ER and anesthesiology being the two largest. Our employed physicians who are just either regular primary care or specialists. I don’t think they’ve been affected in a material way by the No Surprise Billing Act.
Essentially, those physicians are in network with virtually all of the payers that we’re in network with. So it’s really not an issue with them. So this dynamic, I think, is very specific to the hospital-based physicians.
Joshua Raskin: That makes sense. And then just one last one on ’24. I know you’re talking about this normalization. But when I look at some of the same-store revenue growth numbers, mid- to very — mid-to-high single digits in the acute side, very high single digits to low double digits on the behavioral side. It just seems like pretty tough comps. And so do you think this is just more of a catch-up reset year and that next year we’ll be back in that, pick a number, 5%, 6% range overall?
Steve Filton: Yes. And again, I think I made those comments earlier. I mean, I think, yes, I think we think that in both cases, revenue growth, whether it’s exactly in the beginning of 2024 later. But I think we think it moderates to sort of more historically normative levels. And I would also say a more historically normative split. So on the acute side, I do think volumes are likely to come down over time, but I think acuity will come up. And again, we’ll get back to kind of mid-single-digit pricing. I think in behavioral, we’re likely to see pricing moderate a little bit, but also see volumes come up and again, get to kind of mid-to-upper single-digit pricing or upper single-digit revenue growth. And in both cases, I think with the moderation in costs with physician expense on the acute side coming into better control with contract labor coming down and overtime coming down, it should put us in a position where we’re back on that trajectory of getting — being on a path to get back to pre-pandemic margins in both segments.
Operator: I am showing no further questions at this time. I would now like to turn it back to Steve Filton for closing remarks.
Steve Filton: Thank you. We’d just like to thank everybody for their time and look forward to speaking with everybody next quarter.
Operator: Thank you for your participation in today’s conference. This does conclude the program. You may now disconnect.
