Performant Financial Corporation (NASDAQ:PFMT) Q4 2022 Earnings Call Transcript

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Simeon Kohl: Sure. Yes. So in my prepared remarks, I discussed ’20, I think, in the release, ’21. So the ’20 is referring to the commercial, ’21 is probably including the HHS, so ’20 commercial implementations. And so as we’ve shared before, we continue and I think largely consistent with what we just discussed in terms of our pillar strategy with CMS. We continue to have a very, very strong pipeline of opportunities. We’re converting those opportunities, which translate into additional implementations. And so the point here, George, is that we see we have really strong line of sight into a similar cadence that we experienced in 2022 in 2023 for the commercial plans.

Operator: Thank you. Our next question is from Jacob Stephan with Lake Street Capital Markets. Please proceed with your question.

Jacob Stephan: I just wanted to echo the congrats RAC Region 2. Maybe on the CAQH alliance, could you kind of talk to the program implementations? I know you said you had implemented the first program, but maybe give us a kind of breakdown of how that lays out over the…

Simeon Kohl: Yes. So yes, so look, CAQH, as a reminder, as I shared, CAQH aggregates a tremendous amount of coverage data from the various plans. And so ultimately, the partnership that we have with CAQH is we take their data. They’re out there communicating with plans, engaging with plans. We have similar services, but they make their data available. And what we felt the opportunity here was for CAQH to come in with their data, we supplement it with our data. But most importantly, we supplement it with our services, our subject matter expertise around coordination of benefits. And so what that does is it allows these plans really to get a much, much more material ROI on their investment of the CAQH product. And so as I mentioned, we’ve implemented our first plan, our thesis in terms of how the organizations work together, what the value proposition is for the end client has come together.

And while I can’t tell you specifics in terms of what timing is on the various next ones, I can assure you that the teams are working together, CAQH and Performant, and we do have a number of opportunities in the pipeline, and I expect that we will be having an opportunity to share more as the year progresses.

Jacob Stephan: Okay. Got it. Did I hear that right, commercial payers revenue growth of 66% this year?

Rohit Ramchandani: Yes, you did hear that right.

Jacob Stephan: Okay. That’s great. Could you give us a kind of sense on what we — what kind of growth rate we could see into 2023?

Rohit Ramchandani: Yes. So, as we look at 2023 in consideration of our guidance, I think you’ll see something similar where the commercial growth rate is going to be much stronger. And for our government revenue streams, you’ll see growth, but probably more muted as those programs are more mature and also in consideration of all the implementations we’ve been sharing have been almost entirely commercially focused in line with our strategies.

Operator: Thank you. There are no further questions at this time. I would like to hand the floor back over to Simeon Kohl for any closing comments.

Simeon Kohl: Thank you, operator. As you can see, 2022 is a strong year for Performant, both in terms of our strategic accomplishments and our growth. We remain laser focused at driving additional growth alongside our continued efforts to further scale the business and expedite our implementations. We want to thank our shareholders for their continued support, and I hope that we have a chance to see you in person this year. And again, thanks for spending some time with us today.

Operator: This concludes today’s conference. You may disconnect your lines at this time. Thank you for your participation.

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