Jason Cassorla: Great. Thanks. Good morning. I just want to ask on behavioral, you’ve talked in the past around the labor backdrop as the gating factor for bed growth. You’ve discussed the portfolio rationalization efforts. I guess occupancy rates are still some 200 basis points to 300 basis points below pre-pandemic levels, with labor improvement, I know you’re expecting volume growth to accelerate in 2024. Can you just give us a sense on what you’re contemplating on the behavioral bed growth side moving forward and maybe just the opportunities a little bit more around that expansion at current facilities against maybe perhaps the pipeline of JVs or potential M&A for behavioral business as well? Thanks.
Steve Filton: Yeah. I mean, so I think, we added somewhere around 250 new beds in behavioral this year. We will probably add a like number, maybe a little bit more next year. But I think, the comment that Marc made is, I think we’re seeing, frankly, just as much opportunity on the outpatient side as well. So we are expanding and expanding our existing outpatient services across all lines of service, including addiction treatment, et cetera, and plan to continue to do that as well. I think as Josh Raskin mentioned, that’s kind of a higher returning, higher margin business. So, that’s attracting more of, I think, our investment dollars there.
Jason Cassorla: Okay. Fair enough. And then just following up on an earlier question a bit, just curious on what your expectation around payer mix dynamics for acute next year, obviously, redeterminations, exchange growth. You’ve talked about this return of low acuity of Medicare volumes in 2023. Just any kind of expectation around how that trends into next year or into 2024? And then can you remind us what percentage of admissions are uninsured at this point, and if — just given the backdrop, if you’re seeing any indication that those uninsured admissions could be picking up, just any color, that would be great? Thanks.
Steve Filton: No. We haven’t seen a significant change in uninsured admissions, which run in certainly mid-single digits, 5% or 6% of our overall admissions. I think what the big change in payer mix, which I think, both the providers and payers have talked about in 2023 is that, as we’ve emerged from the pandemic, I think, we’ve seen more of those lower acuity, I think, especially Medicare, lower acuity procedures that patients had deferred or postponed during the pandemic taking place. And again, as our volumes moderate going forward and they have been moderating, not just for us, but certainly for our peers as well in 2023, I think, it’s those lower acuity volumes that especially are moderating, which I think to a degree is what’s driving the increase, let’s say, in the fourth quarter in our acuity and pricing dynamic.
Operator: Thank you. One moment for our next question. Our next question comes from A.J. Rice with UBS. Please go ahead.
A.J. Rice: Hi, everybody. Maybe just to the comment on premium pay first. I think you said you started the year at $153 million in the first quarter and you were $67 million as you exited the year. Do you think the $67 million is a good run rate? Is there further opportunity? And putting it all together, how much of a tailwind do you have from reduced premium pay in 2024 versus 2023?
Steve Filton: Yeah. So just to clarify, A.J., the $153 million was the first quarter of 2022, not 2023.
A.J. Rice: Okay.
Steve Filton: So, yeah, that number — obviously that number has come down considerably. I think we still think that there is — we ultimately have talked about getting to a premium pay number in the $50 million quarter range. So there’s still $50 million or $60 million of opportunity. A lot of that is dependent on what happens to volumes. I think that premium pay has remained a little bit higher than we originally anticipated because acute volumes have been as strong as they’ve been. But, yeah, I mean, we certainly have the goal of further reducing premium pay. I’m not sure we’re going to get back to the pre-pandemic levels where it ran about $35 million a quarter, but we should be able to get at least part of the way there.
A.J. Rice: And I don’t have the full year number for premium pay, but how much have you just stated $67 million, how much of a tailwind would that create in 2024 versus 2023? Do you have that number by any chance?
Steve Filton: Yeah. So I think that would probably — I’m doing this all the time. I think that would probably on its own be like a $30 million, $40 million improvement, because I think in the first half of the year, we were running about $85 million a quarter.
A.J. Rice: Okay. And then my follow-up question, just to ask a little bit more on Medicaid, both from the supplemental and the redeterminations. On the supplemental, I know we’ve talked about individual programs. When you put it all together, what you got in 2023 versus what you’re expecting in 2024, how much of a change is it? I guess it could be gross or net after provider tax, just trying to understand that. And then you mentioned, I think in the press release, sort of a 10-K, that Medicaid redeterminations were a headwind for the behavioral business. I’m just wondering if you’d flesh that out a little bit more?
Steve Filton: Yeah. So as I think somebody earlier has suggested, I mean, we did some pretty robust disclosure about these Medicaid supplemental programs in the 10-K that we filed last night. I’d refer people to that. But we have a table that shows the supplemental increase from 2023 to estimated 2024. It’s about a $200 million increase. Obviously, the $150 million of the lot is the biggest piece of that. But you can see a lot of the detail…
A.J. Rice: Right.
Steve Filton: … if you take a look at that schedule. And as far as Medicaid redeterminations, I think, what we’ve said, A.J., is that in the states, which probably is most notably Texas on the acute side and some other Texas and some other southern states like Louisiana, Arkansas on the behavioral side, it’s largely affected the child and adolescent population from our perspective and that’s had a relatively minimal effect on the acute business, a bigger effect on the behavioral business. We’ve seen a softness, I think in the last six months of 2023 in our child and adolescent business in the behavioral business that we attribute to a large extent to these redeterminations. We think we’re sort of out of the works with that.
The redeterminations for the most part or the disenrollments have taken place. We’re already starting to see some of these populations re-enrolled either in Medicaid or alternative programs like CHIP or in commercial exchange programs. So I think that we’re imagining that the impact of redeterminations in 2024 will be limited.
A.J. Rice: Okay. All right. Thanks a lot.
Operator: Thank you. One moment for our next question. Our next question comes from Pito Chickering with Deutsche Bank. Please go ahead.
