Talkspace, Inc. (NASDAQ:TALK) Q1 2024 Earnings Call Transcript

Jon Cohen: Sure. I’ll go back to Jennifer in a second. But we know we continue to see strong amount of evidence that the people who are on the payer side, who are not consumers, who are coming through the BH benefits are absolutely staying on the platform longer than consumers. We – that data is very clear. And I don’t know what we’re going to give relative to specifics, but we do – we have seen increases in people on the platform relative to the length of time and the number of sessions that they do.

Jennifer Fulk: I’ll just point back, Stephanie, to the metrics that we provide, you really see progress against all of them, right? Of course, covered lives, and that’s been consistent, but also the growth in the members that are completing a session on the platform, total sessions, of course, but that’s driven also by utilization. We’ve only moved in the positive direction across all of these metrics. And I believe we’ve got good line of sight to additional levers, both when it comes to the top of funnel, like I mentioned, but also within product features. So Jon referenced a couple of those features. But we do feel like there’s – we’ve got the teams in place, the focus on them and some really interesting levers to pull when it comes to just improving, reducing the friction throughout the funnel, further increasing the capture rate and the utilization within that capture rate.

I’ll just comment on Medicare. We – this is a new category and TAM for us. And so we’ve stayed – we’re staying relatively conservative just in our outlook but we will be testing a lot of things and figuring out what works for that population as we launch these new lives here in the rest of the year.

Stephanie Davis: And in terms of how you’re thinking of – I know you mentioned that’s not really a big factor in the guidance. But thinking about these new populations coming on, how are you planning on structuring the rollout? And how are you, based on – what are your assumptions in order to get us as you ramp up to this?

Jon Cohen: On the commercial? On the Medicare or commercial?

Stephanie Davis: On the Medicare. On the Medicare side. Just thinking – it’s a new population so [indiscernible] the utilization. We don’t know what sort of durability, what do you assume in?

Jon Cohen: As Jennifer said, we’re being relatively conservative in terms of what we think the uptake will be as we begin to test the multiple [indiscernible], as I mentioned earlier, a significant go-to-market strategy, which involves multiple levers that we’re going to look at both on the marketing side and actually directly to Medicare patients. So we’re – we spend a lot of time thinking through this, quite honestly, and it’s also taken us a fair amount of time, as I’ve discussed before, to get us to the point where we can build and collect Medicare and actually address all the nuances of a secondary payer. But the launch itself to get Medicare patients on board is, as it begins, it will be a test. We have the ability, quite honestly, to move relatively quickly to test things that work and don’t work.

As I said, relative to the same thing we do with the schools. But I – as I sit here today, I can’t tell you what exactly is there. We know what platforms they use. We know what social media platforms they use. We know what’s big with them. We know what they’re going to use, video versus texting because for a variety of other reasons. But we also know that a fair number of them are very tech savvy. All of that has gone into the decisions about how we’re going to approach the market.

Jennifer Fulk: Yes. And maybe I’ll just add real quick because it’s important to everything else we do. On day 1, what we do get is just the synergy with our broad marketing media messages and with our brands. So now if you’re a Medicare patient, if you see an ad or if you just come to talkspace.com, looking for where your insurance team might have benefits that cover therapy, you will now see that you, when you put in Medicare, that you are covered. So on day 1, we get the benefit of capture rate just from that broader just the size of our covered lives and that expanding.

Stephanie Davis: Alright. Super helpful. And last one out of me. Just a quick question on the kind of the shift from B2E to payer coverage, how are you thinking about your cost structure as you do this? Is there a way to repurpose some of the folks on the [indiscernible] side or is this something that just maybe declines importance a bit as you focus more on the payers out of the house?

Jon Cohen: So I would say, first off, we took out – we’ve taken a fair number of people within the last year relative to the size of the commercial operation. We have reconfigured it with new leadership and new people, which I’ve talked about, who’s now been here close to months to a year in terms of what that organization looks like. The organization now, honestly, is right where I think it should be relative to what we’re going after on the DTE side, remember, the DTE side is employers, colleges, universities, teens, subcategories, city states, counties. So there is a very – continue to be a very large opportunity on the DTE side and not just thinking about it as all the employers, and I honestly believe that we are now currently configured the commercial organization to approach all of those opportunities with a very substantial pipeline that we already built.