Privia Health Group, Inc. (NASDAQ:PRVA) Q4 2022 Earnings Call Transcript

Joshua Raskin : 2023 guidance, that includes, call it, USD 200 million to USD 300 million incremental attributed lives. So I was wondering if you could just give some color on the categories. I think you gave us the MA, but just sort of where those lives are coming from? And how do we think about that in the — that number in the future, just the gross number of incremental attributed lives sort of based on your pipeline and what you’re looking at. Should we think of that as a relatively consistent number of patients that can convert over time? Or should we think about that as sort of an abnormal year or does it grow over time?

Parth Mehrotra : So if you compare our bubble chart on Slide 12 to previous quarters, you can see the growth year-over-year on those lives. We added Connecticut and we added Delaware and both of those came with 180,000 and then 12,000 lives, respectively. And so we made the appropriate disclosures. So you can see it’s mainly MSSP, some commercial and some MA in those 2 states. That’s all included in the $1.1 million. There’s also organic growth in the existing states as we’ve grown our provider footprint. So there’s some growth across all lines of business in lives from there. And then to your second question, we’ll just take a judicious approach on when we move to downside arrangements. You’ve seen we’ve gone from 0 to 40,000 in 2 years here.

It will not be a linear line. I think we’ll just evaluate it year-by-year. And in our model where we are sharing the economics, 60-40 up and down with our physician partners, it’s a joint decision, and we’ll try and do it when we think it’s profitable and successful to doing so.

Operator: Our next question comes from Jailendra Singh with Truist.

Jailendra Singh : This is Jailendra Singh from Truist Securities. With respect to EBITDA guidance, including approximately USD 8 million to USD 10 million in start-up costs for new geographies and ACOs. I was wondering if you could share some color around the quarterly cadence of those costs and any other puts and takes we should keep in mind as we think about the quarterly EBITDA cadence in general for ’23?

Parth Mehrotra : Yes. I think you should expect the quarterly cadence to be pretty consistent with previous years. From an EBITDA perspective, our spend is pretty even across the years — across the year in different quarters. So it should not be materially different from 2022.

Operator: Our next question comes from Andrew Mok of UBS.

Unidentified Analyst: This is Thomas on for Andrew. Do you have a target for converting a certain share for Privia Care Partners providers to fully implemented providers? Just trying to figure out the general progression you’re expecting and whether converting those providers is a priority in the near term.

Parth Mehrotra : Yes, it is a pretty high priority. We have a good relationship with those doctors and our hope is that they convert to the full stack. We have our internal targets, but obviously don’t disclose that publicly, but you should expect for us to target those 1,440 providers and over time move as many of them to the full stack.

Operator: Our next question comes from Ryan Daniels of William Blair.

Ryan Daniels : Quick one on the guidance. The implemented provider range is reasonably tight 12% to 15% growth. But if I look at the attributed lives, it’s 23% to 34% growth, so a bigger range there. And I’m curious if there’s any nuances between those 2 metrics, larger provider groups coming on with more patient panels or anything unique that it describes kind of the larger range on lives under management?