Hi, good afternoon, everyone. My name is Norm Rosenberg. I'm DocGo's Chief Financial Officer. I'd like to welcome you all to our very first Investor Day. For those of you joining us here at Nasdaq MarketSite here in New York, we thank you. We welcome you. We thank you for coming in for the meetings. For those of you joining us remotely, we thank you for your participation. Over the next 90 minutes or so, you'll have the opportunity to meet and to hear from key members of DocGo's leadership team, who will share their vision and also describe how some of DocGo's solutions are working for our key customers today. We'll close things out with a Q&A session. First, a little bit of housekeeping. During the course of our presentation and the Q&A session that follows, we will be making forward-looking statements.
These forward-looking statements are subject to risks and uncertainties, including, but not limited to, those that are mentioned in our annual reports on Form 10-K, our quarterly reports on Form 10-Q, and any other reports and statements that we file with the SEC. The actual timing of these events or the results could differ materially from those that are implied or are predicted by these forward-looking statements. DocGo's business, operating results, and financial conditions could therefore be significantly impacted. DocGo has experienced substantial growth since our launch in 2016. We've added new business lines, we've expanded our geographic footprint, we've hired thousands of clinicians, and we've developed and implemented proprietary technology that allows us to deliver care at scale to our patients and our partners across the U.S. and abroad.
We like to think of ourselves as one of the very few healthcare companies that is both growing the top line very rapidly and still generating positive cash flow. Which brings me to our investment thesis. DocGo focuses on a very rapidly expanding part of the healthcare industry, which is the preventative healthcare space. There's a very broad range of potential use cases for our low-cost mobile healthcare services, particularly as it pertains to the underserved populations. We've got a track record of strong revenue growth and positive cash flow generation. All of the pieces are in place, and we'll discuss this later. All of the pieces are in place for margin expansion in the near and intermediate term, and also for some operating leverage as greater scale is achieved.
Finally, we have the financial strength and access to capital today that will allow us to execute our growth strategies. Before I really kick this thing off by introducing our first speaker, I want to tell you a really quick story about the first time that I met Anthony Capone. It was back in December of 2019, and I came in to interview at the company, at the headquarters. I met just about every member of the DocGo leadership team at the time, and I remember Anthony and I spent about an hour together. Looking back, I would say about 55 out of those 60 minutes were spent talking about DocGo's platform, about algorithms, about AI, about machine learning. It was like a geek factor 10 conversation between the two of us.
I came out of that conversation with three distinct thoughts that I want to share with you. My first thought was: Boy, these guys really dress casually around here. My second thought was, Again, we only spent an hour together at that time. This is probably the most passionate, intense corporate leader that I have met in about 25 years. The third thought was: I came in here to this meeting thinking I was coming in to meet with a mobile health company. This is not a mobile health company. This is a technology company. Everything about the company back then, and the same thing now, even more so, everything is driven by the tech. It's all about the tech. It's a way of using technology to solve problems.
I hope that by the time we're done here today with our discussions, that you get most of the same impressions that I got during that meeting, maybe except for the casual dress thing. Everybody's looking pretty spiffy today. Now it's really my pleasure to welcome DocGo's CEO, our leader, Anthony Capone, to discuss the future of healthcare and DocGo's role in driving positive change. Anthony.
Thank you, Norm. Norm is the single most insightful finance executive I've ever worked with. He never misses the forest for the trees. Thank you to everyone in the audience today. We've invited you here to share the story of how the company we've built is well-positioned to transform healthcare in the coming years, our vision for the future. Why is transformation necessary? We firmly believe the U.S. healthcare system is broken. It's inefficient, ineffective, and highly expensive due to its reactive nature, for all its significant cost, I don't believe it has led to better healthcare outcomes. The United States healthcare system is the most expensive on the planet. Our per capita healthcare spend is more than double the average of any other country.
In 2021, Americans spent more than $4.3 trillion on healthcare, nearly 17% of our gross domestic product, double the average of other wealthy countries. That's crazy. With all this spending, you would anticipate the United States would lead the world as one of the healthiest nations, but that is not the case. In fact, Americans have some of the worst healthcare statistics in the developed world. We rank 26 out of 38 among the other wealthy countries that make up the Organisation for Economic Co-operation and Development. Our rates of unmanaged diabetes, asthma, and other chronic diseases are amongst the worst of these same developed countries, and care for these chronic diseases results in 85% of total healthcare spending. Six out of 10 Americans have a chronic disease. Four out of 10 American adults have more than two chronic diseases.
Where does DocGo come in? $612 billion is spent annually on healthcare waste, which DocGo directly impacts, such as unnecessary hospitalizations, decompensations due to unmanaged chronic diseases, and administrative complexity, primarily driven by fee-for-service reimbursement. We believe that the U.S. healthcare system is based on a reactive, episodic model that is broken. DocGo's model is designed to be proactive, managed, and singularly focused on driving value through creating healthier patients. Through our proactive delivery model, we believe that we can tackle the large addressable market of healthcare waste in America's traditional brick-and-mortar, fee-for-service model. In summary, we believe that America's reactive and fee-for-service paradigm makes sick people sicker and poor people poorer. It makes healthcare less accessible to a staggering number of patients. It's time for a change.
We need to shift from the current reactive healthcare model that fails so many patients to a proactive care delivery model, a nimble, technology-powered approach that reduces waste, anticipates need, and brings care to patients on their terms. A model that transforms how healthcare is delivered in the U.S. and abroad. We believe that the solution to the current reactive model is proactive healthcare. DocGo is designed to deliver proactive healthcare at scale. We call it the proactive healthcare revolution. It looks like this. That's just a little taste of the courses we'll be serving throughout this program. Let's begin by understanding our model. Proactive healthcare is care that moves and acts early based upon anticipated need. Our thousands of skilled clinicians deliver on-site treatment to patients, enabled by our advanced AI-powered technology platform, before they need to be hospitalized.
DocGo brings care to patients on their terms, outside of the four walls of the traditional medical establishment. The clinical care delivery model combines software, hardware, and proprietary clinical workflows to manage patients and populations for their conditions and circumstances, and provides treatment in more efficient and effective ways. DocGo's agility, technology, and flexibility help us deliver efficient treatment and improved outcomes. Whether that's infusing diuretics in an elderly person's home, or performing wound care to a homeless person right on the street, or treating a rural patient in the back of a mobile clinic in a Dollar General parking lot. We deliver care in the patient's environment, not ours. We believe that proactive healthcare provides tools for people to live healthier lives. It allows us to monitor patients remotely and intervene before minor issues become major crises.
It helps us bring care to lower acuity patients where they are, when they need it, freeing up specialists and hospitals to focus on the higher acuity patients who truly require their attention. We have spent many years understanding this problem, and we believe we've built a solution. Now let's show you how DocGo's proactive care delivery model aims to disrupt the U.S. broken healthcare system with a differentiated solution based on three key pillars. Number one, mobile care delivery. Number two, advanced technology. Number three, aligned reimbursement. I'll give a brief introduction to each pillar and then invite our leadership to provide a more detailed description and some demonstrations of our core capabilities. The first pillar is our mobile care delivery. We believe that the power of our model is the modality of care, specifically its scalability and lowered cost basis.
We aim to combine the efficiency of telehealth by virtually pairing a specialized physician assistant with an on-site, generally trained LPN in the home to be that PA's eyes, ears, hands, and feet. The second pillar is advanced technology. At our core, DocGo is a tech company. Let me repeat that again. DocGo is a tech company. When DocGo was a private company, we raised almost $140 million. Of that, we spent approximately 50% and wrote millions of lines of code to build out our proprietary technology system. For example, this investment allowed us to be the first app in the Epic marketplace that can be used to order both medical transportation and mobile care services for post-acute visits.
Think about this, every day, in a fully automated system, we send thousands of healthcare providers into the field using our proprietary automated platform, which we've meticulously optimized over the past seven years. A massive, highly sophisticated medical logistic backbone that pairs, in real time, patient medical need with the clinical competency of over 1,000 mobile medical teams across our vast footprint. The final pillar, a critical pillar, is aligned reimbursement. We aim to flip the traditional ineffective reimbursement model on its head. The vast majority of our business is not fee for service. Instead of tying our model to services provided, we prefer to attach our reimbursement to the value created for our patients and partners. We're dedicated to the care of the patient, dedicated to specific outcomes, dedicated to achieving specific objectives as opposed to just treat and release.
We are increasingly targeting value-based per member per month and leased hour payment models. We're geared to achieve specific patient outcomes and system performance metrics. It's our software, it's our vehicles, it's our clinicians, all brought together into a single technology-enabled platform. To be clear, we are not a broker. We aim to control the end-to-end delivery. Customers and patients seem to love our solution. Our 2022 patient net promoter score was an 85, as compared to the average healthcare industry NPS score of a 58. Now, before I like to introduce our President and Chief Operating Officer, Lee Bienstock, it's amazing. It took us many years to steal Lee away from Google, where he led extraordinary growth for over 10 years across numerous divisions, from ads to fiber and beyond. It's truly my honor to partner with Lee as we take DocGo to the next level.
Lee?
Thank you, Anthony. It's great to be here with everyone. I joined DocGo about a year and a half ago. Ever since I joined, I've consistently gotten the same questions over and over again: Where does your growth come from? Why do customers choose you? Why do you win? Different flavors of the same question. Today I wanna answer that question for you. It's actually pretty simple. We help people stay out of the hospital. Think about it. Is there anything more important in the world? Is there anything you wouldn't do to keep your loved ones out of the hospital? You want your aging parents to be healthy and comfortable at home for as long as possible. Your friends and family certainly want you to stay out of the hospital. That's the answer. We help people stay out of the hospital.
Not only do you want to keep your loved ones out of the hospital, turns out your insurance company and Medicare want you to have access to proactive, preventative care that helps prevent you from going to the hospital. Turns out municipal governments want to reduce unnecessary, costly use of the emergency response system and the emergency departments at public hospitals by delivering more timely care directly to their citizens where they are, out of the county hospital. Turns out your physicians and providers are incentivized through at-risk, value-based arrangements to keep you healthy and to prevent unnecessary hospitalizations. Turns out even hospitals themselves want to avoid emergency department readmissions, unnecessary hospital stays, and they wanna manage their beds such that healthy patients are discharged on a timely basis, and those beds and those resources are made available for sick and critical patients who absolutely need it.
Don't misunderstand me. The role of hospitals is absolutely essential. For high acuity health needs, like true emergencies, surgeries, cancer treatments, and more, we need our hospitals to be capable and to be ready, and to have the space and to have the resources, and we help with that. We are perfectly aligned. Turns out everyone wants to keep you out of the hospital. Turns out everyone is financially incentivized to keep you out of the hospital, and that's why we win. That's why we grow. That's why our customers choose us. We help them keep you out of the hospital. I'd love to share four great stories, four great examples of the deals and the partnerships we've won, and the work that our teams are so proud of. One, how we've worked with municipal governments. Two, how we've worked with hospitals and health systems.
Three, how we work with health plans and payers. Four, how we work with providers to keep people healthy, improve patient outcomes, and ultimately fall in love with DocGo. First, an excellent example of our great work with governments and public institutions is our ongoing partnership with the City of New York. Yes, it all started with COVID. When we came to the rescue, testing and vaccinating over 2 million New Yorkers. Think of that scale, 2 million. Lots of companies tested. We, on the other hand, pushed the boundaries and co-created hand in hand with the city, a completely new concept.
The nation's first ever test-to-treat mobile health units, where we not only tested for COVID, and also flu, and also RSV, but if you tested positive, we also treated you on the spot by writing you a prescription for antiviral medication and also dispensing it right on the mobile unit, breaking down barriers to accessing life-saving medication, increasing access, and helping keep people out of the hospital. While other companies tested, only tested, we tested, and we treated, and we wrote prescriptions, and we provided life-saving medication, and that's why the city loves us. That's why the city expanded with us well, well, well beyond COVID. Now, with COVID in the past, it catalyzed us partnering with the city on many more initiatives.
One great example is our Street Health Outreach and Wellness program with NYC Health + Hospitals, which has won multiple awards for its impact in helping bring care to the city's unsheltered homeless population. We've won many awards for this program. We've won the Fast Company World Changing Ideas Awards and the UCSF Digital Health Awards, among others. The SHOW program has provided care to over 200,000 patients, many of whom would have been hospitalized had it not been for our clinicians diagnosing abscesses, infections, decompensating chronic conditions, and behavioral health crises, all that were able to be treated street side before they precipitated a hospitalization. There's just one example. Our work with the city now spans 12 contracts in many different departments.
We now have more than 1,500 clinicians working on mobile health teams, serving public health programs across the city. With that, I'd like to now welcome New York City Mayor Adams, who has allowed us to help deliver exceptional mobile care and access to city residents over the past several years. Mayor Adams, thank you for joining us.
Thank you. Thank you. Thank all of you as well. I recall, going back, during 1984, when I was a rookie police officer. I was a computer geek, actually. I was one of the four or five police officers that created, the first, way of how we analyzed crime. It was the precursor to what was called CompStat. I'm not sure many of you may be outside the city, and if you are from another municipality, you know, I only ask is that, you know, please spend as much money as possible in New York. We changed the way we were thinking about, public safety, and we learned so much in the process, going from being reactive to proactive to eventually predictive.
A few months ago, I stood in a classroom with a group of educators at a summit, I put up a photo of the first telephone that Alexander Graham Bell had, I put up a photo of a classroom and showed the false first telephone in the first classroom. I put up a photo of the smartphone, I put up the photo of the classroom. The smartphone went through several evolutions. The classroom was the same. We were teaching our children how to handle Alexander Graham Bell, while we were having devices that were going far beyond our expectation. That's what DocGo is about. If you don't have Docs on the Go, then you have a retro thinking of healthcare.
It is impossible that we learn from COVID, that although it was a place of pain, it became a place of purpose. We took the devastation of COVID-19 and turned it into the opportunities. Every day, we're seeing these challenges beyond our expectation. To have an entity and a partnership we developed, where we were able to reach people where they are, people who were not able to come inside a health facility because that would have aggravated the problem we were having. DocGo stepped up. It not only stepped up, it allowed us to step ahead of COVID. We were finding that so many people were going to healthcare facilities and infecting others. We were finding that we didn't have a real test and trace opportunities. The previous administration saw the possibilities. We saw the need to continue.
The partnership with NYC Health + Hospitals, the partnership with even our migrant asylum seekers, 70,000 in the city, over 70,000, to be able to have that solid partnership that's continued to evolve is crucial. This is going to cascade throughout the entire country, because all of the mayors across the country, they are all wrestling with the same problem of: how do we have an effective modern-day response to the healthcare crises and the future pandemics that we are going to face? I thank DocGo. When I think about the origin of this company, the story of having a father that could not leave the home to go and receive the medical treatment that he desired, he had to find a way around that even after his transition.
I think about the countless number of family members all over this country, and all of us know someone who's going through some form of healthcare crisis. To find a solution by using technology, using mobility, and using well-trained staff to deal with the healthcare crisis. The more we keep people out of hospitals, the more cost-effective it is and the more opportunities we have that people with access to healthcare that they need and healthcare they deserve. I wanted to come through, number one, to tell this company, thank you for what you did during our difficult time. Number two, as much as I possibly can, to try to get as much money out of your pocket into my city to spend. Visit One Vanderbilt, one of the greatest buildings in the country.
Go to Broadway to see a play and enjoy what's great about this amazing city we call New York. Thank you very much. Thank you.
Thank you, Mayor Adams. Thank you, Mayor Adams, for your leadership. Really, truly, we work in a lot of states, we work internationally, New York truly is one of the big leaders in increasing public health access across the world. Okay, as I mentioned, the second big group we work with, hospitals. Hospitals are vitally important, they, too, wanna keep you from being readmitted and to streamline their bed flow for patients who are in need of vital care. One great example, another one we're very proud of, is how we work with health systems such as Jefferson Health in New Jersey and Pennsylvania. Jefferson is an 18-hospital system with nearly $8 billion in revenue and 42,000 employees. Every year, 581,000 people are treated in their emergency departments. They have more than 5.6 million outpatient visits.
DocGo, we've been partnering with Jefferson since 2019, and it started with just three ambulances at one facility in Pennsylvania. Today, our transport network serves their multi-state, 18-hospital system with 35 dedicated leased-hour ambulances, transporting more than 68,000 patients a year. Jefferson uses our digital transportation optimization platform, which interfaces with their electronic medical records and their bed management platforms. Our reliable, timely transportation bed management optimization helps patients who are ready to go home from the hospital do just that. We've also expanded our partnership with Jefferson to include transitional care, visits, and provide medical services and health assessments in the home. When patients boomerang back to the ED, to the emergency department, it negatively impacts a hospital's quality metrics and future reimbursement rate for CMS. Readmissions are bad.
They're bad for the hospital on a multitude of levels, and of course, they're bad for the patient. Nobody wants to land back in the hospital. To tell you more about our partnership, I'd like to bring up Beth Duffy, key partner, our Senior Vice President of Administrative Services of Jefferson Health. Beth, thanks for joining us. Thank you, Beth.
Well, thank you. It is a pleasure to be here. DocGo has worked with Jefferson Health on a wide range of programs, including home health assessments, employee health programs, population health programs for nursing homes, and partnering to provide services at the Philadelphia International Airport during the COVID-19 pandemic. DocGo medical providers work in our emergency departments. They also were the first company to manage medical transport in almost all of our hospitals across our enterprise, providing community connect, which is wheelchair vans, advanced life support and basic life support. Last year, DocGo launched America's first-ever electric EV ambulance and partnered with Jefferson to complete the first-ever EV ambulance trip with one of our patients at our Abington Hospital facility. That's just one example of how DocGo is constantly seeking ways to innovate and help us elevate the level of patient care. They are a key partner for us.
Thank you so much. I'll turn it back over to you.
We're so excited what we've done and what we're gonna continue to do and well into the future with our work together at Jefferson. Thank you. Lastly, let's show some examples of our recent successes and future expansion plans with providers and payers, a critical focus area for our near term and our future growth. As I mentioned, your insurance payers and your healthcare providers are also heavily incentivized to keep you out of the hospital because the more and more of them are getting added into value-based arrangements. Currently, approximately 70% of Americans with Medicare and 48% of Americans with Medicaid are enrolled in managed care plans, representing more than 87 million Americans. That's a huge addressable market for us.
Those members, as I mentioned, are enrolled in various national and regional health plans who have agreed to a value-based rate structure, where they are heavily incentivized to keep costs down and improve patient outcomes. What we all want. Let me tell you about one of our care gap closure programs for Managed Medicare patients. In late 2022, one of the largest physician practice groups in New York and New Jersey, with more than 8,000 primary care and specialist physicians, called HealthCare Partners, engaged DocGo on a care gap closure program directed to 2,000 of their hardest to reach patients. This is one of my favorite deals, favorite partnerships. It was December, HealthCare Partners wanted to make a meaningful impact by the end of the year. Did I mention it was already the last month of the year?
Okay, we got the call on December fourth, and we were launched on December seventh. 72 hours. In just 72 hours, we were mobilized and conducting 6,000 calls via our integrated data feed with our national operations center in Alabama, and we completed care gap closure home visits for hundreds and hundreds of seniors in a matter of weeks, identifying new or worsening symptoms of their chronic illnesses for early intervention. The definition of proactive healthcare. The in-home screenings we provide, such as annual diabetic eye exams, are some of the hardest care gaps for health plans and physician groups to close because they traditionally require an in-person visit with an ophthalmologist. Left unchecked, these issues can cause permanent blindness or diminished sight. DocGo brings connected retinal screening devices with a high degree of accuracy directly into the patient's living room.
Nearly every single day, nearly every single day of the program, our team identified new patients with abnormal findings, meaning that patients and their health plans would not have known that they potentially needed early intervention. HealthCare Partners has seen success with us in reducing total costs for their at-risk patients. Today, we're announcing that we're significantly expanding our partnership in 2023. DocGo anticipates serving more than 5 times the number of patients. We're gonna add emergency department diversion services for frequent users in 2023. We have contracts like this one with physician groups and payers across the country with value-based programs. In total, DocGo is partnered with health plans representing more than 20 million covered lives. Today, we're announcing new payer agreements with EmblemHealth and BlueCross BlueShield of Tennessee, representing an additional 6.7 million covered lives.
For EmblemHealth, DocGo is now operationalizing multiple mobile health programs, including transitional care management and quality improvement programs. As Anthony mentioned, more than 40% of the population have at least two or more chronic diseases, and we believe many of them are candidates for our remote patient monitoring services to help manage their chronic conditions. We provide a fully managed remote patient monitoring solution, from device provisioning to facility and patient onboarding to billing. Our DocGo On-Demand home visits program complete same-day house calls for RPM device setup and escalation, particularly providing after-hour coverage for physician groups. For most RPM companies, nearly half of their patients are not effectively monitored or compliant. Not us. Through our patient engagement specialists, paired with our mobile field staff completing in-home device setup, we're achieving a monitoring compliance rate of 94%.
Our monitoring results in hundreds of hours of physician and staff time saved, as well as increased revenues through compliant billing summaries. Where do our patients come from? Well, we use partnerships with physician groups, as well as specialists in clinical areas that tend to have more chronically ill patients. One great example of this is our recent partnership and preferred provider agreement with Fresenius Medical Care, whose partnering nephrology practices treat patients with chronic renal disease, a disease with one of the highest costs of care. Now, we're starting with a pilot, offering our services to their top 81 nephrology clinics, with the goal of expanding our RPM services to their patients throughout the country. We're excited about this because Fresenius and its affiliated providers deliver dialysis treatments for approximately 205,000 patients nationally.
By improving health through RPM for chronic diseases associated with kidney disease, we can sometimes delay end-stage renal disease and the need for regular dialysis for months or even years. The monthly cost of end-stage renal disease jumps by more than $14,000 per month once dialysis is initiated. as opposed to $225 a month for our proactive healthcare services, RPM and virtual care management. Our services not only improve health, but decrease costly, burdensome care on the healthcare system. Now, in addition to nephrologists, we also specialize in partnerships with cardiology groups and electrophysiologists at health systems. Now, heart failure, we all know, is the leading cause of hospitalizations among older adults, and they have the highest readmission rate of any condition. DocGo's certified cardiac monitoring team currently monitors more than 40,000 patients with heart disease across the country today.
In summary, these are just a few of the ways we're helping our partners, governments, health systems, providers, and health plans, care for their patients, improve health outcomes, and ultimately, keep patients out of the hospital, which ultimately helps to improve financial performance, and even more importantly, what we all want, helps to improve patient outcomes. At the end of the day, that's what everybody wants. I wanna leave you with a summary of where our growth comes from. DocGo's growth comes from three areas, and we've made significant strides on all three. First, we get organic growth in our existing markets and with our impressive roster of core customers. You heard from a few today. Every single one of our current markets is on track, and we expect them to grow in 2023. We're delivering strong performance across our footprint.
Second, we're signing new contracts, we're winning new RFPs, we're pursuing market expansions with governments and health systems. Our RFP machine, as I like to call it, RFP machine, has grown both the number of submissions and the average size of those submissions, which are bearing fruit. From Q1 of 2022 to Q1 of 2023, our contract value resulting from proposals grew at an average of 18% per quarter since we aggressively began growing our RFP department. Recent RFP wins include contracts with regional health systems for at least our medical transportation in New York and Pennsylvania, solidifying our status as one of the largest in each state. We won a telemedicine 911 triage program contract, an occupational mobile health contract with a county in California, and multiple new migrant mobile health contracts with a new city department in New York.
Thirdly, winning partnerships for patients enrolled in managed care plans. Today, we announced we recently signed two new payer contracts with Emblem and with BlueCross of Tennessee, but we also have an additional 19 open deals in our sales pipeline with health plans and at-risk provider groups that, if closed, would equate to approximately 250,000 patients DocGo anticipates it can provide medical care to over the next six to 12 months. When you add up the TAM of our growth areas, we reach well into the billions of dollars in anticipated market opportunity. In fact, we plan on being a $1 billion revenue run rate company by the end of 2025. Later in our presentation, I'll leave it to our CFO, Norm, who's gonna walk you through in greater detail how we plan to achieve our billion-dollar goal.
First, I'd like to welcome our Chief Product Officer, Aaron Severs, to show our care delivery model in action and how we aim to help drive value for our patients and our care providers to help keep you out of the hospital. Aaron?
Thank you, Lee. It's been amazing to partner with you this past year and a half, and also, again, to join forces with Anthony and Hawk, two of the most innovative engineers that I have ever worked with. I joined DocGo because I believe this team is positioned better than anyone else to bring needed change to the healthcare industry. Healthcare that meets us and our loved ones where we are, is both a great experience for patients and also can improve care and lower total costs. We have an innovative formula that has taken a number of years to develop. Our technology is designed specifically to orchestrate mobile healthcare, and we combine that with an efficient staffing model using lower-cost mobile clinicians and a network of virtual providers. This combination helps us deliver high-quality care when and where it's needed at costs that work.
It is a scalable platform for delivering our three core products. These are mobile healthcare, remote patient monitoring, and medical transportation. As DocGo's Chief Product Officer, my job today is to share with you how these solutions work, how we provide an amazing experience for patients that they consistently rave about, and also how we deliver amazing value for the organizations that we partner with. As Lee just covered, we work with a number of B2B customer segments. Those include hospital systems, governments and health plans, and also physician practices. Rather than simply tell you how our healthcare solutions work, I want to show you. We created three never-before-seen videos just for this event. In this first video, we'll see how hospital systems use DocGo as their enterprise-wide solution for medical transportation. Let's take a look.
This is Mrs. Thomas. She was recently admitted to the hospital with congestive heart failure, Today she's ready to be discharged. Floor Nurse Sarah uses DocGo to order transportation for Mrs. Thomas with one click right from the patient chart. DocGo's powerful AI kicks in, calculating the best options from thousands of permutations. Our technology factors the patient's condition, insurance plan, required equipment, optimal fleet utilization, traffic, and routes are taken into account to provide a real-time ETA to the nurse within seconds. DocGo's AI-powered platform has already helped over 1.5 million people like Mrs. Thomas by making the incredibly complex task of pairing patients with the right medical transportation or care providers seamless, highly automated, and scalable. When Nurse Sarah orders the trip, the assigned unit is notified through DocGo's driver app. The unit confirms the trip, swipes go, and are on their way.
Simultaneously, Mrs. Thomas' family is notified, and they are able to track the progress of the trip in real time, which provides a welcome measure of transparency and peace of mind to patients and families alike. The assigned unit arrives at the care facility where Mrs. Thomas is ready to be transported home. The crew uses the DocGo app to map the most efficient route to the destination. After a quick and comfortable ride, Mrs. Thomas arrives home and is brought inside by the crew, where she's given a warm and grateful welcome by her daughter, Jane. The trip is complete, because at DocGo, resting at home is always the desired outcome.
As you just saw, our technology is the control plane for our services. It provides complete transparency for hospitals, patients, and their families. Before switching to DocGo for transportation management, the nation's largest municipal hospital system lacked a reliable way to manage more than 100 patient transports each and every day. Hours of staff time spent every single day calling multiple vendors to try to get consistent service for their patients was just not working. Implementing DocGo and our Epic EMR integration has now provided them with total transportation management, driven by DocGo's software and our on-time service guarantees that are made possible through our dedicated unit, leased hour service model. Our solution helps this large health system improve operations, improve customer satisfaction, and also improve patient throughput, which is a major revenue driver. Now, hospitals are also a significant source of patients for our mobile healthcare programs.
We work with hospitals to integrate DocGo's proactive home visits into their discharge work, workflows, and they use the same software platform you just saw to do this. Hospitals face financial penalties, as we mentioned, and reduced reimbursement for readmitted patients, and our post-discharge house calls and remote patient monitoring solutions have shown to directly address this problem. Let's now see how DocGo's home visits work in our next video.
One of the most impactful ways hospitals can leverage DocGo's capabilities is by implementing our transitional care management program to prevent costly readmissions. Using our integrated software, Nurse Sarah is able to schedule a post-discharge visit for Mrs. Thomas right from the patient chart. Mrs. Thomas is notified via SMS about the timing of the visit, and in real time, can track the unit's progress on its way to her home. DocGo's clinician, Carl, arrives with all the equipment, supplies, medication, and technology needed to perform a complete exam and address a wide range of concerns in the home. The visit takes place wherever it's most convenient for the patient, because a living room is so much more comfortable than an exam room. DocGo only sends specially trained nurses and medical technicians into the home.
Clinician Carl connects Mrs. Thomas with a board-licensed provider, who will conduct the exam via remote diagnostic technologies and direct all treatment.
Hello, Mrs. Thomas. My name is Pollock. I'm a physician assistant with DocGo. I'll be conducting your visit today. I'll have our mobile health clinician connect to the device, so I can listen to your heart and your lungs. You are going to take a nice, deep breath in and out. Okay, that sounds great! Your lungs sound good.
After the exam, the provider determines if a patient is a good candidate for remote patient monitoring. DocGo has RPM and care management programs for multiple conditions.
I'm happy with what you're doing at home. I'd like to enroll you in our remote patient monitoring program. This way, we can keep an eye on your weight, your blood pressure, and your oxygen level.
Clinician Carl shows Mrs. Thomas and/or any caregivers how to take readings using devices supplied by DocGo, which empowers the patient and offers a welcome measure of peace of mind, knowing their care team is just a click away.
If you ever need to reach us, you can use that app to chat with us or even just request a visit.
With on-demand access to care through DocGo's home visits and virtual care team, Mrs. Thomas is able to remain healthy at home, not in the hospital. Because there's just no place like home.
You just saw an example of our cutting-edge care delivery model in action. We had an LPN in the home and a physician's assistant on video directing all care. They treated Mrs. Thomas in her home and set her up for a successful recovery following her hospital stay. We use this same healthcare delivery model to power many of our solutions for governments and government-sponsored health plans. For governments and health plans, we provide population-level healthcare. Our goal is to reduce unnecessary and costly emergency room visits, and also help health plans improve HEDIS quality metrics. You've already heard from Lee about our strong municipal partnerships, where we bring mobile clinics to those most in need. Those are a targeted way to address some of the inequities that exist in healthcare today.
In addition, we also work closely with Managed Medicaid and Managed Medicare plans to bring our proactive home visits to targeted populations within their member base. This is a high-growth area for us. In fact, Lee just announced some of the new health plan partnerships that we signed this quarter alone. We work with these health plans' quality improvement teams, who partner directly with us to boost their HEDIS quality benchmarks. The Centers for Medicare & Medicaid Services, CMS, provides nearly, or sorry, over $10 billion annually in performance-based incentives for health plans to hit these specific quality goals. Health plans have dedicated quality improvement teams that are focused on these metrics, and they bring in DocGo to help. We integrate data feeds with the health plan, so our software can trigger automated messages and phone-based outreach to proactively schedule convenient home visits.
Here's a specific example that I want to share with you. Let's say one of our mobile clinicians, like Carl, who you saw in the video, is dispatched to facilitate an annual wellness visit to a member with known hypertension who has not seen their PCP in over a year. The health plan needs to show that their member's blood pressure is under control in order to achieve their quality goals. Let's say Carl takes Mrs. Thomas's blood pressure, and it's 190 over 96. That's above the HEDIS benchmark of 140 over 90 and also high enough to need an intervention. During our house call, we take her blood pressure, and then we may increase her medication and enroll her in remote patient monitoring so that we can ensure her blood pressure gets under control.
We send visit summaries to Mrs. Thomas's PCP, who we then partner with in her treatment and also in meeting her health plan's goals. More importantly, we also help Mrs. Thomas feel better and stay out of the hospital. In our last video, let's see an example of how DocGo's RPM program works. Take it away.
Let's say Mrs. Thomas's RPM device triggers an alert for a low pulse oximetry. She's immediately connected to a DocGo care team member, who will work to diagnose the problem. RPM device readings transmit to DocGo instantly, and the platform alerts our virtual care team of any concerning changes. The care team checks in with the patient to determine the best course of action based on their care plan. A virtual visit with the provider can be scheduled within minutes, which in this case, is what Mrs. Thomas's care manager recommends. Pollock, the provider, reviews Mrs. Thomas's RPM data and can ask for a real-time reading.
Let's go ahead and take a pulse oxygen reading right now.
Okay.
With this information, Pollock is able to make changes to Mrs. Thomas's treatment plan and review everything with her virtually.
I'm going to order a new prescription for delivery and ask you to stop taking your current medication once it arrives. I'd also like to order an EKG for you. DocGo will be arriving in 90 minutes to perform this procedure.
Okay, that's great.
Mrs. Thomas and her family are notified of treatment plan changes and the upcoming visit via SMS. Real-time tracking is available on the DocGo app. By monitoring patients remotely and treating them at home, DocGo helps to keep lower acuity patients out of the hospital, which frees up clinicians and lowers the blood pressure of the entire healthcare system.
Your oxygen levels look much better now. Our team will check in with you tomorrow to see how you're feeling. If you need to connect, please reach out to us anytime via the app. We'll keep monitoring from here.
Thank you.
Yes, thank you so much.
As for Mrs. Thomas, it's been over a year, and she hasn't been back to the hospital since.
Our RPM program works great in partnership with PCPs and specialists. This is the last customer segment I'm going to cover today. Physicians bring us in to help their patients with our turnkey remote patient monitoring and chronic disease management solutions. We work with cardiologists to monitor tens of thousands of patients. These specialists typically see patients every three to six months, but when they need care in between these pre-scheduled visits, where do they go? Too often, they end up in the ER. I'm going to tell you the story of one of our patients, Mr. Gordon, who was enrolled in RPM after his daughter contacted his PCP, who was not able to get him in that day. Mr. Gordon is 90 years old. He lives in Jersey City, has a pacemaker, and congestive heart failure.
He was assessed by DocGo during our first home visit with him, with low blood pressure and lightheadedness. Instead of going to the hospital that day, we adjusted his blood pressure meds and put him on RPM. Just a few weeks later, our system proactively alerted us that Mr. Gordon had concerning blood pressure changes and also several pounds of weight gain over just two days. These were symptoms of a heart failure exacerbation, which very often leads to hospital admissions. We again sent our mobile clinician to his house and proactively intervened before it became an emergency. Mr. Gordon would have likely ended up in the hospital not once, but twice, within a matter of weeks, if it weren't for DocGo. Instead, he gets to stay home, where he can spend quality time with his daughter and his grandchildren.
We have countless stories just like this one, and it's extremely rewarding for us to see the impacts that we've made on our patients' lives, while also meeting and exceeding the expectations of our partners. To sum it all up, our three products, mobile health visits, remote patient monitoring, and medical transportation, all work together to provide a continuum of care that can achieve better patient outcomes and better-managed costs. We work with a wide range of organizations to service their existing patient populations, and they enter our care continuum through multiple entry points. We monetize the care we deliver with performance-based pricing that aligns our success with that of our partners, while building in downside protection.
Now, I'm going to introduce the CEO of our Clinical Practice Group, Dr. James Powell, who I met when he was still a DocGo customer, as CEO of a successful health center in Long Island. He was so impressed with the results of our home visit programs for his health center that he decided to come aboard. Dr. Powell, it's been amazing to partner with you on the development of our products.
Thank you so much, Aaron. I do smile once in a while, so I got to. Thank you, everybody. You saw some phenomenal videos. We're going to tackle the clinical strategy behind this model. You're going to see how we structured our care delivery model to help improve patient outcomes, lower healthcare costs for our patients and the partners. At DocGo, we treat tomorrow's conditions today. How do we achieve this? Well, as much as we've invested in the technology, we spent countless hours in the clinical workflows to provide this care, all with the goal of integrating ourselves in the entire healthcare ecosystem. DocGo understands and aims to address the entire continuum of care that is desperately needed outside the walls of the traditional setting. We divide care into four different buckets: acute, episodic, chronic, and preventive.
This is the foundation of the proactive care model. We like to refer to our model as delivering a full envelope of care. The goal is to kind of protect, educate, manage, and embrace, and engage our patients in their own care. The goal of proactive care is to be able to improve outcomes based on our patients' medical episodes and reduce the frequency of unnecessary, and as we know, burdensome care. Over time, we aim to shift the balance to more value-driven, proactive care through our mobile care foundation. It begins by understanding the patients we serve. Once we understand how a patient is attached to their provider network, we aim to establish a 12-month cycle of wellness for each patient. This establishes the opportunity for us to look at the care they need today, this year, and for the rest of their lives.
We're not task-driven in our approach, we're value-driven. A visit to the home is not about just checking a diabetic's blood sugar or measuring someone's bone density. It's about assessing and documenting the obstacles in their home and in their community. It's about offering additional support. It's about doing retinal eye exams, examining a diabetic's feet, looking for risks of falls. Many of our quality touches are actually with patients who already have a PCP. Our goal is to maximize the PCP relationship, enhance the value that a patient has with that PCP, and that's how we handle the acute, episodic, and chronic, and preventive nature of our services. All the work we do is forwarded back to the provider. With that mobile extension of the healthcare provider, it could be a PCP, it could be a specialist, a health system, or a payer.
We help them keep the finger on their pulse of their patients through our virtual and deployable models. On top of all this, we scale with the demands. What do we do? DocGo aims to extend the reach of the provider. Our goal is to address the shortage and burnout of the PCPs and specialists. We help providers because they're overwhelmed and understaffed. If you look at the current estimates, up to 48,000 primary care providers will be needed by 2034, and this does not acknowledge the inefficiencies of the care that's out there now. For years, as a physician, I tried to create team-based workflows inside my health centers. Unfortunately, these efforts came up short. DocGo gave me the aha moment. The real answer is a mobile partner that integrates externally. That is where we believe the success lies.
Our approach is not just to be nimble, it's to helping to identify the areas of friction for our partners along the patient's journey. We positioned ourselves to not only assist others in growing their care delivery models, but we are positioned to be a standalone, full-service PCP option in the future. Our groundwork is creating the flywheel effect. We engage our patients actively in their care for each step of the journey. We aim to be the glue that binds value. We believe we keep people out of the hospital, and we also believe we have the ingredients for accelerated growth. We have value-based contracts in the pipeline with payers and provider groups that represent millions of patients. As we continue to grow the value of our patient satisfaction and the cost savings, we expect our patient base to rise exponentially.
Let's walk through a real-world example of the impact of our programs. In Los Angeles, we have a partnership with L.A. Care for Transitional Care Management Services, and this really targets patients once they've been discharged from the hospital. Mrs. Jimenez spent eight days in the hospital for pneumonia and complications of diabetes. She's identified as a candidate by L.A. Care, and they reach out to Holy Cross, our provider network hospital, and they put an order in for discharge for this patient. This warm handoff allows us to introduce ourselves as an extension of the local hospital and as an extension of the health plan. We socialize the program, we introduce our home-based visits, and Mrs. Jimenez knows about us before she leaves the hospital. This transitional care management visit includes a thorough health risk assessment.
We do screening for depression, we review the medications, we set up a short-term medical plan for this patient, all with the goal of reducing the hospitalization. With this plan and program, we can do multiple visits to decrease the likelihood of being readmitted. In this case, Mrs. Jimenez could not see her primary care provider for three weeks, she needed her glucometer, she needed her blood pressure pills, and these were all handled by DocGo within 48 hours of the discharge. Without this service, she would easily have ended up in the ER or back in for a hospitalization from complications of either diabetes or hypertension. We kept her out of the hospital. These programs deliver results. Even one of our visits helps reduce healthcare costs.
In a parallel program, also in L.A. County, in Transitional Care Management, we've been able to reduce readmissions for patients between 30% and 50% in comparison to those who did not have visits. In total, we estimate that our national ED diversion programs to date have saved more than $200 million in unnecessary ED visits and hospitalizations. Think about that. I'd like to introduce our Chief Technology Officer, Hawk Newton, to showcase our technology. Like the bird, he'll show us how our technology soars above the competition. Hawk?
Thank you, Dr. Powell. Yes, my real name is Hawk. Most software deployed in healthcare today is based on old technologies and doesn't deliver the modern experience users have come to expect. The original idea behind DocGo was to revolutionize medical transportation through software. We've accomplished that and so much more. As we expanded our mobile health service lines, our technology platform expanded with us. Today, through a suite of technology products, we deliver a wide range of healthcare services, whether mobile urgent care, ambulance, or our proactive care management. With a few clicks, healthcare is at your door. We've dedicated tens of thousands of developer hours to build a world-class platform designed to orchestrate everything needed to deliver world-class, proactive healthcare to patients via mobile health visits and medical transportation.
Using our proprietary software suite, we're able to scale much more quickly and cost-effectively than traditional companies in this space. We're a modern shop using best practices like agile methodologies, continuous deployment and integration, and blue-green deploys to the cloud. We deploy software 5 or more times per day after running thousands of regression tests that emulate the user. As a technology-first company, we invest heavily in software. Our in-house development team has the bandwidth to automate problems that would be very time-consuming and error-prone for old-school companies to do by hand. Our mobile health management, dispatching, and scheduling platform, called Dara, is the central nervous system we use to run most of our operations. Using advanced AI algorithms, we dispatch and optimize our fleet, which provides several types of medical transportation services and home health visits for a wide range of needs.
For our customers, Dara's web-based requester can be used as a standalone application or embedded within an EMR, such as with our Epic App Market integration. By integrating directly with a hospital's EMR, the clinicians that work at the hospital have the ability to access our software in the exact same system they already use every single day. I know you've heard a lot about our software. Let's move on to demos. Let's say I'm a caseworker at a hospital responsible for patient care. As you've seen, Mrs. Thomas was recently discharged from the hospital after an acute congestive heart failure. We're going to send a unit to her home to perform a transitional care management visit to ensure she's recovering and being cared for correctly.
Our clinician is also going to ask Ms. Thomas today about enrolling in remote patient management program during our visit. I enter her address. I choose the desired date and time for the visit. Once I click Save and Get ETA, the system goes to work. I do want to stop and acknowledge how deceptively simple this has looked so far. It might seem like we're just ordering a car, but there's a lot more going on here. When finding a matching unit, we need to consider things like service level of the request, specialty equipment required for the visit, specific capabilities of the crew, licenses of both the personnel on board and the vehicle itself, including their geographic boundaries and effective dates.
We also need to include temporal aspects like start and end of shift times, whether the crew have done enough required breaks, the amount of time the specific visit will take. You know, if it's a medical transportation, pickup and drop-off time, we have to include any existing commitments for the vehicle. Like, that really, honestly, is just the tip of the iceberg. This looks very, very simple, but it is, in fact, really, really hard, and it's one of the things that I'm most proud of in my career. Let's take a quick peek behind the curtain and see how the system quickly and accurately provides ETAs for every single mobile health visit and medical transportation trip we book. You're looking at the scheduler.
It provides a view of resources across time and makes it easy to determine where each trip is in its lifecycle and if any need attention. With both real-time and historical data, we use powerful AI to determine the projected location of units and determine if they're capable of running a trip. Once we have a list of candidates, we use an advanced suite of algorithms to find the one that's in the best position to run the trip, optimizing for patient experience and unit efficiency. In all this, we take into account all of the complexity that I mentioned earlier. Boom! We've got an ETA of 4:00 P.M. All I need to do is accept the ETA, and the unit will automatically go en route in order to arrive at Mrs. Thomas's residence in time for her visit.
Patient information, coverage information, and patient condition are pre-populated from the hospital EMR, can be updated as needed. Additionally, we can feed the system the phone numbers of Mrs. Thomas, her loved ones, and caregivers to be sent an SMS of our share link. Here's the share link, which keeps everyone up to date on Mrs. Thomas's appointment. Ordering medical transport utilizes the exact same technology, infrastructure, and processes that we just saw for mobile health. We provide hospitals with a total transportation management solution that includes both the services DocGo directly provides and a network of ancillary providers that can offer additional capacity as needed. I can't stress enough how game-changing we believe this to be for hospitals. Many hospitals that aren't on our platform have an entire department that sits on the phone, calling ambulance companies all day, trying to arrange medical transport.
Now, let's have a look at the tools our operations staff use to ensure everything runs smoothly across our large network. Most trips are completed without any additional human interaction beyond the clinicians and the patient, but we have a central team that looks out for issues. Here, you see our app view, which gives us a real-time view of where each unit is and what it's up to. I can click into a given unit and view its capabilities. Every unit on the road, onboard computer that informs us of the unit's current location and health of the vehicle systems. The same onboard system uses advanced computer vision, integrated with artificial intelligence, to alert us of any unsafe behavior. Here, you're seeing an extreme braking event that exceeds half a G. I love how everybody's like.
We see our trips dashboard, which provides an overview of trips and visits in progress. Health and customers also use this view to keep tabs on any requests they've made and where they are in their lifecycle. The team can move trips between units if necessary, such as if a specific trip needs to be reprioritized. Thanks. Okay, cool. Let's see here. Where were we? If a trip needs to be rescheduled at a customer's request. On the left, you can see the share link being monitored by Mrs. Thomas's care team and loved ones to track the progress of her visit today. On the right, you'll see the driver app, which is used all day in the field by our mobile health and medical transport teams.
Those of you in the audience for which we have a phone number on file, will receive a share link via SMS. Feel free to click on that link and follow along with us. As you can see, when the time comes for the crew to go en route, they receive a notification on their iPad. Once they indicate they're en route, the share link reflects that change real-time. We're going to simulate the completion of this trip so you can see it transition from to appointment to on-scene, to patient contact, and finally to complete. That's how our Dara platform works in a nutshell for DocGo's customers and our own internal users.
Behind all of this, we've built the platform on an ecosystem of microservices and APIs that can be leveraged by our partners in order to build custom interfaces or receive real-time updates. Next, I'm gonna show you our patient-facing mobile app, DocGo On-Demand, which was built just last year using APIs from our Dara platform. Available on iOS and Android, patients we're seeing a collaboration with our partners through on-demand programs are invited to download and sign up. Those of you that are in the New York and New Jersey area, I invite you to download the app next time you or a loved one needs attention. I think you'll love it. It's an incredible experience. I've used it several times myself. Now, a quick demo.
I was feeling a little under the weather the other day and decided to book a mental health- not mental health, a mobile health visit. Different kind of visit. First, I search for a symptom or condition. Next, I provide a brief description of my symptoms. I'm prompted for my location. As you can see, it's pulled from my existing patient profile. I can use DocGo On-Demand to schedule a visit for myself or a family member. I'll indicate I'm the one that needs treatment and move on. I can update insurance if necessary. As you can see, the app has connected to the Dara platform and been offered an arrival time between 3:00 P.M. and 4:30 P.M. today for my visit. The system attempts to schedule the patient in a way that's efficient for field units based on the urgency of the request.
If I want, I can ask for a different date and time, but this looks great, so I'll click Confirm. My visit's all set. I can click to track it, leveraging the share link. After my visit, I'll receive additional documentation or letters through the app. For patients in our care, the chat feature is key for our proactive remote patient monitoring and care management programs. Patients receive push notifications with messages and reminders, and can chat real time and leave messages for their care team. As you can see, we've built a fully integrated model to deliver healthcare through our proprietary technology and modern, easy-to-use user experiences for clinicians and patients.
I wanna welcome back Norm Rosenberg, who's gonna walk us through why we believe our proprietary technology platform, innovative care delivery model, and our strategic growth plans will help us reach a $1 billion run rate by the end of 2025.
Thank you. Thank you. I have to say, it's really refreshing to work with a CTO like Hawk. I think that in my career, he's probably the most ROI-focused technology leader that I've ever had the pleasure of working with. We are almost always on the same page. I hope everybody's been enjoying the presentation so far. You know, we've heard a lot of exciting things today, from our vision to our technology, from our care delivery model to our ability to execute. My colleagues have done such a good job of presenting all of this information in such a compelling way, that I'm actually a little bit reluctant to be back up here now. I'd hate to kill the mood with a numbers discussion. The numbers are critically important.
We absolutely have to wrap some numbers around these discussions, both historical and prospectively. As shareholders, we're most interested in how all of these elements come together to synthesize the financial statement. I'd like to spend the next few minutes discussing a few things: our history of strong financial performance, what our revenue portfolio looks like in the near and the intermediate term, and the financial outlook for DocGo in general as we get closer to scale, including our steady state margins. In addition, as you heard a few minutes ago, our President and COO, Lee Bienstock, decided to drop this billion-dollar revenue run rate nugget and was kind enough to mention that I would be the one that would explain it, so we'll do that, too, very smoothly.
To get an idea of where we're going, the first thing we need to do is to take a look at where we come from. From 2016 through 2022, DocGo generated a CAGR, compound annual revenue growth rate, of 84%. Specifically, we went from $11 million in revenue in 2016 to $440 million in revenue in 2022. It's 40-fold. The other thing to bear in mind as well is, as we go back for a three-year period, and we look at the quarterly revenues over that three-year period, we're showing the medical transportation business, the classic ambulance business, as well as the relatively new mobile health business, and we can see how that revenue has grown over time.
The other thing that you can see here is we've added the COVID testing revenue as we've broken out in our financial statements, as we've broken out in our filings and in our earnings releases. That gives you two benefits. Number one, it shows you how that particular revenue stream added to the overall revenue growth, and it can also show you how the underlying revenues continue to grow, as you can see on the next slide. The next slide demonstrates that same period of time, and we can see what the revenues look like, excluding that non-recurring COVID testing revenue. As COVID testing revenue started to decline and then eventually, essentially disappeared to the point where it's really not material, we were still able to pivot, and we were able to add other revenue to get there.
We've heard a lot about this proactive healthcare stuff that we're trying to do, when you think about that and the associated revenue streams, such as RPM, we would expect to be able to have quickly ramp up. That's going to be our biggest and fastest grower of our revenue streams as we go forward over these next couple of years, and we expect it to be a major component on our march to $1 billion in revenue. While we've always been a growth story, we've never been satisfied with the idea of just putting points on the board. We've always aimed for profitable growth. Even in the early parts of the company's life cycle, when we were striving to hit certain scale, we're trying to get ourselves on the map, the emphasis was always on doing this in a profitable way.
You can see this when you look at the trend in our gross margins over time, and you can look at it in the progression from losses to profitability, which is illustrated by our adjusted EBITDA trend. That makes that clear as well. You know, I can recall shortly after getting to the company in 2020, several strategy sessions where I sat with Anthony, with Stan Vashovsky, our founder, and then CEO, and we would talk about milestones in terms of when DocGo would reach profitability. When would we hit a positive EBITDA number? When would we hit net income? In what month would that happen? In what quarter would that happen? I can't recall a single time where we had a meeting where we said: When are we gonna hit this revenue milestone? What month? What quarter?
When are we going to get to $20 million in monthly revenue, $30 million or $40 million? All milestones that we've since reached, of course. We've never talked about that. Growth has always been our goal, but profitability has always been our yardstick, and that's how we look at it for the future as well. That hasn't changed. Now, in the early days, focusing on profitability was a necessity. We had no choice. We just couldn't afford high burn rate. Even now, though, as you know, with money in the bank and access to a large credit line, we continue to view things in the same way. Even with this kind of balance sheet, with those kinds of balance sheet ratios, we still think of that in the same way.
It makes for really, really good sound bites, and I've always been all about the cliches, but what does it really mean? What does it mean in practical terms? For one thing, it means we are absolutely not interested in any loss leaders, whether it's on the transport side, on the mobile health side, or eventually on the RPM side or any other business line. Every meaningful project and every meaningful customer relationship needs to be profitable from day one. We've spoken a lot about the idea in recent months. We've spoken a lot about the idea that we've incurred significant start-up costs for our larger mobile health projects, which have led to narrower margins in the earlier phases of project. Let's level set here for a second. Let me make it clear. Every one of those projects is profitable from day one.
It's just that it takes a little bit of time to get to the projected margin level. With that in mind, let's spend a little bit of time talking about our unit economics. We definitely want to discuss our gross margin goals on a high level, but it's really helpful. I find that it's very helpful to look at what is behind those goals and to start breaking things down into a single contract, a single transport shift, or patient engagement. Let's start with the economics of a home visit. You've seen the video, now read the spreadsheet. This is a side-by-side comparison of our unit economics versus a traditional model. You can see the traditional model would involve sending a high-level clinician, let's say, an APP or a doctor or a PA, right into somebody's home.
Our model, as you've seen and heard described earlier today, involves a little bit of a hybrid model, where we're sending a lower-level clinician into the home, and that person is also attached, and is tied into a, the practitioner that is remote. As you can see, in our model, there's plenty of margin to be had, while in the other model, the so-called traditional model, there's much less margin to be had, and in certain cases, depending on the payer, it's actually underwater. Here's the catch: this is not simply a matter of me lining up two columns and showing how one is more expensive than the other. None of this is possible without the technology. Without our ability to get the right clinician to the right place with the right equipment at the right time, none of this is possible.
I'm often asked by people in the investment community, "Well, this doesn't really seem like rocket science. Why couldn't somebody else do this?" The answer is, somebody else could do this. If they had a fleet of 1,000 ambulances and other vehicles, if they had spent tens of millions of dollars developing a technology platform over the better part of a decade, yes, they can do that. Those are our differentiating factors. The tech is a differentiating factor that allows us to take advantage of this, I'll call it the pricing umbrella, or the ability for us to come in at a high margin for a service that others are not able to generate a margin to it. Next, let's look at a mobile health project. For this one, we took a sample project or one of our projects that we did.
To make it clear, I wanted to do this in a way where it was a relatively simple project, where we're primarily paid for labor. In reality, most of our projects were paid for interactions, were paid for labor, were paid for the vehicles, were paid for the supplies, were paid for other overhead. This is something that I wanted to pick something that was pretty straightforward, so we can see the impact of the labor cost as it changes over time. As you can see, the left side. The left column is the project launch economics. In the early stages of a project, we have higher overtime rates as we're overstaffing and as we're trying to get our footing in terms of how we need to staff.
We have higher agency costs, agency labor costs. There are other things. There are vehicle rental costs, other things that happen. Over time, over time, as we've talked about, you've all heard about our rapid normalization project and the normalized margins that we've talked about. Over time, those margins improve. That's what happens. It takes a little bit of time to get from one column to the other. The rapid normalization project essentially says, "I want to shorten the distance from this column to that column." That's what we're trying to do. Again, even day one, even in the, you know, so-called narrower margin or depressed margin period, it's still a very positive margin. Finally, let's look at the unit economics on the transport business.
For this one, I spared you all the chart. Instead, we're gonna go with a little bit of a graph. As you know, we talked about how we're moving from a traditional legacy fee-for-service business. We're going from that model to a leased hour model, where we're paid on an hourly or daily rate to make an ambulance and the related equipment and personnel available. What I'm showing here is this is across a different range of scenarios, number of transports in a particular shift. As you can see, two important points. The first point is that the green line, which is the leased hour, has a higher margin across the board. You can see it's pretty narrow towards the back end of it.
The main thing about this, the main advantage of the leased hour model, is not that it has higher margins. The main advantage of the leased hour model is that it protects our downside. Whether it's on the mobile health side or on the transport side, one of our key mantras, and it's not something that just comes from finance. This is something that comes from Anthony. He'll say it twice as many times as I say it. We need to protect our downside on the volume side. We need to mitigate the volume risk throughout our business. We're not interested in building a business and hoping that the customers will come. We need to mitigate our downside risk, and that's what we do. Those are three very quick views of unit economics likes, types of views of our different business lines. Look, it's great.
It looks like the unit economics work. That's fantastic. The real trick is to be able to take those unit economics and to apply them at scale. How do we do that? Let's look to the future. Now, as we do that, please bear in mind the numbers that we're gonna share over here, okay? These are goals. These are not guidance. These are internal targets. These are not forecasts. We'll issue more specific guidance as we travel down the road, but I wanted to give everybody today a little bit of insight, peel back the curtain a little bit, and get an idea of, you know, what are the kinds of numbers and the kinds of things that we're discussing when we're together in a conference room?
In 2023, this part, we have guided towards, we expect to eclipse half a billion dollars in annual revenues for the first time. How do we get to $1 billion in annual revenue? For a company with ambitions like DocGo, life begins after $1 billion. Let me demonstrate to you that we're really not that far off. First, a couple of assumptions that underlie our long-term planning. The mobile health business is expected to grow at a 30%-35% annual rate over the next couple of years. For context, that business grew by 39% in 2022, and if you break out the COVID testing from the equation, it actually doubled. Transport business is expected to grow at 20% annually for the purposes of this exercise.
That does not assume any new market entries or acquisitions. Rather, we get there by more fully rolling out the leased hour model. We're expanding our business with our existing relationships, and we're adding more relationships. We're bringing more health system customers into our existing markets as we look at what our funnel looks like today. Finally, the RPM business, which is only going to be a sliver of 2023 revenues, maybe 1%, 2% of 2023 revenue, that's expected to be our fastest-growing segment off a relatively low base. We're targeting for RPM to account for nearly 15% of total revenues as we exit 2025, on a full year basis, more like 12%, as you can see over here. This is a general idea.
This is simply a pie chart that we made out of our, you know, internal model that gives you an idea of how that revenue would break down based on what we have here. Based on this is what things would look like in Q4 of 2025. We took those numbers and rounded them down a little bit, so it's not a coincidence that they're very, very round. If we were able to do this number, if we can do $250 million in revenue in Q4 of 2025, and based on the numbers that I just shared with you, that's how the model works out, then that would obviously be an annual revenue run rate of over $1 billion of $1 billion.
The most exciting thing to me, as we look at this, is that we expect to hit that milestone, but at the same time, both our gross and EBITDA margins expand. Not only are we not sacrificing margin to get there, but we think that as this happens, we're going to actually get to the point where we have better margins. Also, I should point out, this plan would not, it would not involve abnormally large capital expenditures or anything of that nature. If we were able to execute in this way, we would witness very strong operating and free cash flow generation over that period. Let me pick one piece of this, which is the gross margin, and let's scroll down a little bit, because I think this is where we most need to execute.
When I think about the future, you know, we've got the RFP channel that Lee and the others have talked about. We've got all these other opportunities and customer opportunities. Feel pretty good about the revenue stuff, although, of course, anything that involves forward-looking statements is gonna be a little bit risky. I think it's the margin side where we really have to hammer away. We have to make sure that we execute. For the past couple of years, we've been talking about having a goal of reaching consolidated gross margins of 40%. Again, for some background and context, in 2021, gross margins were 34.4%. 2022, they were 35.1%. This year, we've guided towards 35% gross margins.
As we've said, it's gonna be a little bit lumpy this year, but we're gonna see some sequential growth or improvement as we go throughout the year. What I wanna do is I wanna put a bridge together, which is what you have behind me here, which shows you how we can get to that 40% number. Here are some of the key drivers. Number one, margin normalization project. That involves labor costs, vehicle costs, supply costs, a lot of different things. The first phase of which is currently underway, which is expected to eventually get us about four points of margin. Another three points of margin would happen as we get into what I would think of as phase two of our margin normalization project.
That happens towards, let's say, the back end of 2024, even into early 2025, and that's as we completely transform our labor, vehicle, and supplies model. Just to be clear, it's all about changing the model and the service model. It's not a matter of, you know, putting a finger up in the air and sort of wishful thinking and hoping that you can get to a higher margin level. It's based on specifics as far as how we narrow down our choosing of vendors and how we're RFPing. We're doing RFPs for the provision of these services, as we've talked about, and a couple of other things around our service model that allow us to squeeze some margin out of it.
We also expect continued adoption of the leased hour model for transport, which will help push gross margins for that segment above 30%. For context, they're running in the 28%-29% range, we're not really that far off. Because we are looking at the future, we need to be realistic. We've actually built in a couple of points of margin headwind. We're building in the impression that, or the expectation that on some level, inflation will continue, and we're gonna see some continued wage pressures. I will say, we actually seem to have had an easing in wage pressures in recent months. We're gonna assume it, and we're gonna assume that general inflation is gonna persist throughout the forecast period.
We don't expect to be any more successful than the Federal Reserve at projecting when, what inflation is going to be. We're just gonna build that in anyway. By the end of 2025, what we're looking at is, on a segment basis, we think that mobile health gross margins can be in the low 40% area. Transport can be in the low 30s, and RPM, as a higher margin business, is gonna be at 50%. Actually, by adding the high-margin RPM to the mix, that's gonna give us a little bit of an advantage as well. That is not built into the bridge, but that should help us drive margins even above the 40% level on a consolidated basis, blended basis.
If we're able to do that, even with a healthy increase in SG&A in 2024 and 2025, right now, we've got built in annual increases of about 20% from 23 to 24 to 25 in SG&A. Even if we were to do that, we would still have a model that, as we exit 2025, would get us to about a 20% EBITDA margin. Give you a little bit of idea of the model and how things break out. Large TAM, as you heard about, rapid revenue growth, expanding margins, operating leverage, and a strong balance sheet. That is the DocGo financial story. I want to thank everybody here for listening. Thank you very much. At this point, we'd be happy to take your questions. I'm gonna invite my colleagues back on stage for the Q&A session.
We'll take a couple of minutes to get that or a couple seconds to get that set up. That Q&A session is gonna be moderated by Anthony. Thank you very much.
Testing, testing. Good, good. For those of you who do have questions, we have a few runners around the room. Feel free to just raise your hand and go over with microphone. We got a dude over there in the back. Is there up here?
Hi, it's David Grossman from Stifel. You know, at the beginning of the presentation, you talked a lot about RPM and CCM, and obviously, a big focus of the company. Maybe if you could just take a few minutes to talk about maybe some of the, you know, obstacles and perhaps the catalysts that, you know, help you achieve your goals to really drive growth in that business, which is fairly nascent right now. Maybe if you could help us understand how that varies, you know, depending on the segment of the market that you're targeting?
Sure. Our strategy is when we go to roll out RPM or to roll out VCM, is we look for kind of multipliers, so individuals who already have lots of providers in their group, as opposed to going provider to provider to provider. On the cardiology side, we had that with Cardiac RMS, which is an acquisition that we did in Q1. In Q2, we did that with, you know, the national arrangement partnership we did with Fresenius. It gives us access to all of their nephron. The key kind of biggest barrier is, okay, when you have that, now you are, let's say, Fresenius's preferred provider for RPM and CCM for all the nephrology practices. Now it is onboarding all of them.
Although they're already kind of bought in, because you are the preferred, you are the kind of exclusive provider there, you need to onboard them operationally. You need to be able to go to that geography, and you have this nephrology practice who has maybe, you know, 1,000, 2,000, 3,000 patients with chronic kidney disease. How quickly do you have the ability to then enroll and onboard them as they come for their routine visits into the clinic? Because that's how we physically do it. We actually put someone into the clinic, and as they're going on their visit on that day, we then schedule them, and then we do an actual on-site home installation of the device.
That's the real reason why I think it was either Aaron or Lee, Aaron, on the, Lee, on the fact that we have above a 90% compliance rate, when the industry average is half of that, is because we go into the home and install it. The biggest, I wouldn't say necessarily barrier, but the biggest, initial task to accomplish is that onboarding and enrollment.
Got it. Can I just take a moment? just, you know, on the margins, you know, you've done a great job of explaining, you know, what you're doing with staffing companies and the normalization plan. Can you maybe just help us to mention how much? Because your financial guidance for the year contemplates some pretty significant margin expansion in the back half of the year. Perhaps you could mention how much visibility you have on that expansion today, and also, what are some of the more specifics that you're gonna do to get you kind of that second phase of margin expansion that you talked about?
Sure. As we mentioned on the rapid normalization project that we had before, you know, it really came down to changing the startup costs that we had, and staffing is the largest portion of that. Staffing and staffing agencies are what percentage of our COGS? Not staffing agencies, sorry, staffing, labor-
Staffing is, you know, over 60% of our COGS.
Over 60% of our COGS. You know, when you think about changing the relationship that we have with our staffing agencies, it's a very, very material change. What we did was we went out and we put all of our staffing agency contracts, which was, how much in 2022 did we spend on staffing agencies?
At that point, probably $6 million, $7 million, $8 million a month in some months.
Yeah. We put all of that out for bid. All the staffing agencies had to come to us, and they had to change their model to work with DocGo, because DocGo is a, you know, rapidly growing company. In order to work with us, we needed to change those unit economics to shorten the amount of time it took in that startup phase, meaning that we were able to convert their staffing agency employees to DocGo employees in about half the time. That is already well underway, and all of that is already effective as of today. It's been effective for a little bit now.
I think with that change, that gives us tons of visibility into exactly how the labor rates change, and from there, it's fairly easy to put that into, you know, your accrual rates and your forecast.
Yeah, it was a very competitive process. We had over 50 submissions just from the staffing agencies that we've historically worked with, to select the ones now that we're concentrating our business with. By the way, it was very nice to be the one receiving the proposals this time instead of, you know, our team is usually the one submitting them. That's where we got the idea from, and it was actually a very successful process. Now we have those contracts in place with visibility on the rates, and we know exactly how we're gonna roll that out for the rest of the year.
Yeah, the other thing I would add there, David, is that, you know, this rapid normalization is not just a matter of sort of waiting until the invoices come in the mail or by email and hoping that they are where we expect them to be. We have a daily, you know, a little bit of inside baseball here, right? We gotta have the sausages made. We have a daily end-of-day meeting, right, that involves three of us, among others, and we talk about how we're doing, and we track this from a KPI perspective on what percentage of our labor, both on a project-by-project basis and overall blended basis, is coming from subcontractors versus those that are W-2. We're looking at the KPI, that gives us a pretty good indication.
When we reported Q1 numbers, for example, and we talked about how we had improving margin trends, not only improving margin trends throughout the first quarter, but how some of the KPI, I mean, we had references, in fact, that some of the KPI were really looking pretty good as we headed through April and into early May, when we released the results. That's how we know, because we're looking at it on a daily basis. Now, obviously, it doesn't count until you see it in the invoice, but we have a pretty good leading indicator of the fact that some of this stuff is happening in terms of the improvement in the model.
Hello? I am on. Thank you for the presentation. It's very comprehensive and very thorough. One area that you really haven't discussed is competition. What are we facing? I think it was discussed that we have 19 in the process of bids. Who are we facing? What are our barriers to entry? That's something I'd like to get some sense on.
Yeah, I'll literally go into some of the specific competitors that he's seen out there. It's important to understand that the biggest true differentiator of DocGo is most companies do one thing. I do home infusions, or I do wound care, or I do urgent care visits, or I just do primary care. That's not how DocGo was built. From day one, we understood that the key to success was efficiency. Just mathematically speaking, to drive efficiency, you need to have the largest top of the funnel, meaning the largest amount of demand in order to put onto your supply. Just narrowing, putting yourself into some niche corner where you can only do one thing, will just simply reduce your efficiency. When we go in to our various different contracts, you don't see the same groups of people.
You see somebody who just does that one thing. Lee, maybe you talk a little about some of the people you see on our larger ones.
Yeah, I wanna say, actually, we didn't forget about. We saved the best for last. We actually have a slide specifically of the competitors and all the various competencies we have. We saved that special for you.
There's more to come.
More to come. We have just a few more slides left, and that's actually one of them. Yeah, I would say we see competition across the board. I would say we see competition from our various customer segments. I think there's very few companies out there that are going after all the customer segments with the continuum of care and products and services we're providing. I would say we see medical transportation companies, which very rarely, they don't do any work in the mobile health space, and then we see competition in the mobile health space, which we'll detail out, and none of those companies do medical transportation.
we feel like the combination of all of our products and services and the vertical integration of our clinicians, our technology, our vehicles, our logistics, kinda put us in a very distinguished and very differentiated space, which we'll show in just a minute.
Very exciting guidance on many fronts, appreciate the detail that you guys offered. I wanted to understand a little bit better the 2025 target for run rate, $140 million on the RPM. It's the 2,700 PMPY, it's 52,000 members. You guys talked about looking at a group of maybe 400,000. Can you talk to us about the process, maybe some benchmarks of how you step into building that book of 52,000? Where does it go from there? Is it possible there could be more potential members in that initial contract, or are we thinking about growth coming from additional partnerships?
You take the one on the additional partnerships.
Yeah.
Let me just break down the unit economics to build up to the $140 million. You know, of those, we monitor all different types of patients. First and foremost, you've got ones with CRMS, which was CIED. A CIED patient, that's cardiac implantable electric device, those ones, you're getting about $100 a quarter on. You have RPM, just remote patient monitoring. The difference is, you know, CIED is like an implantable device. RPM is an external device, your blood pressure cuff, your glucometer. That's bringing in about $100 a month. Now, of those individuals who are polychronic, rather than having somebody who's hypertensive, somebody who has CHF, those individuals, you're gonna get another $150 a month, $250.
The cohort isn't all getting $250 per month. Some are getting $100 per quarter. It's a mix of all of the different types of monitoring that we have that kind of build up to that. When you fast-forward, at least for this calendar year, as far as the makeup goes, you're looking at about 50% that's gonna come in from CIED, about 50% that's gonna come in from RPM, CCM. Of the RPM, about 70% of that's probably gonna come in from cardiology. You know, from the CRMS acquisition, and about 30% we expect to come in from the dialysis from the nephrology clinics through our national partnership with Fresenius.
I would say the growth is really, our projections really come from the number of patients that our payers and provider partnerships provide us with. That's really what we're looking at. We're not interested in sort of B2C, you know, consumer marketing, trying to sign up patients. We have very specific partnerships, cardiology practices, nephrology practices, other specialists, PCPs, that are essentially referring us patients, and we're partnering with them to provide that proactive healthcare. That's really where the growth is going to come from. It's going to come through those partnerships, and we know the number of patients that those partnerships currently have, and we have a penetration rate that we project out on those patients.
Can you talk about the margin profile of that segment?
Sure, Norm?
I mean, one thing that we've seen is that the margin profile of the segment is very high. We talk about, I think, in the presentation, I think we mentioned 50%. We've actually seen, and not only with CRMS, but with the companies that we looked at, that we didn't end up buying, we saw margin profiles actually in the low fifties. It's a pretty high margin profile for sure. The other thing that's nice about it is we talked about mitigating the downside risk or the volume risk. When it comes to the RPM business, you know, again, on the surface, it looks like we're getting right back into that kind of thing, it's a primarily variable cost model. There's very little in the way of fixed costs.
We're able to get the customers, and then we're able to make sure we have the clinicians, and we have the back office that's able to service those customers. It's not only a relatively high-margin product, but it's the kind of thing where it's. Well, it's never guaranteed margin, but it's pretty stable margin type of business. The only wild card there would be. If we were to choose, if we get to a point where we decided we're gonna spend a lot of SG&A, we're gonna spend a lot of marketing costs in terms of customer acquisition costs. That is not, you know, that would go very much against the grain of the way we think, and you've all probably heard Anthony talk about this.
You know, we don't wanna have any customer acquisition costs. We wanna be able to do this on a B2B, B2C basis, so you really don't have the customer acquisition costs. I'm just saying that, you know, on paper, it is possible somewhere down the road, a couple of years from now, if we have the opportunity to build off an already large base, and we're able to get a good ROI on it, sure, we'll do it, right? Other than that, I mean, it's a pretty stable margin type of business, pretty high-margin business. There's already been a couple of changes in terms of the reimbursement rates in some of these areas, so that part is behind us. That risk is sort of behind us, and I think that we feel pretty good about the margin profile of that business.
Hey, Ryan MacDonald with Needham. Thanks for taking the time. This is actually probably good based on your answer there, Norm, around customer acquisition costs.
Yep.
If we look at the mobile health growth, you talked about 30% to 35% annual growth, and I think the payer channel is probably a good component of that over time, given the two new announcements today. You've now got, I think, seven, eight payers, I think, over the last year and a half. Can you give us a sense of what that sort of trajectory in terms of increasing penetration within those member populations are? How much of that is coming from your own sort of customer acquisition costs versus the payers, and how should we expect that to expand over time or evolve over time?
Let me just comment on the strategy before we go into the financials, just so you understand the difference. There's kind of a key difference between some of the past payer relationships that we had and some of the new payer relationships that were just announced. In the past payer relationships that we had, there were pilots in order for us to do ER diversion, where we were a service that was offered to a population within a given payer.
Whereas the new ones that Lee just mentioned, they give us the patients, meaning that they go, and they say, "Hey, here is t he 2,000 members, the HCP example." Perfect example, right? They give us two, five, 10, some cases, a lot more, many tens of thousands of patients, and say, "These are non-compliant members." They're non-compliant for some reason. From there, we have the ability to go and service them in our own route, in our own schedule. Very distinct difference. We'll let Norm talk about what the contribution is of those programs to the forecast we gave.
I can also say from a product perspective, these are the patients that are the best for our solutions. We're improving access to care for folks who would otherwise not be getting it. Everyone wants us to do that.
Yeah.
Another way to look at it is that we've kind of moved our way away from the right to hunt type of contracts, where you get into that kind of thing. And I'll tell you, personally, I'm familiar with it in other industries, whether it's telecom or insurance, the direct-to-consumer channel, which is very, very tempting because it's always such a huge addressable market, and you figure it's the kind of thing that you can model out very easily. You can look at your average cost per customer acquisition, then you can compare that to the lifetime value of a customer, use a discount rate, you're ready to roll. It's just a big machine, and you just keep feeding stuff into the machine, and it works until it stops working, and that's when you have the headache.
You know, our way of looking at it is that we don't need to restrict ourselves to these right to hunt type of contracts. There are still plenty of payers or other potential partners out there for whom we can solve a certain problem, where they're giving us the customer. Again, I wanna be careful about it because I don't want, you know, somebody to come back to me in three years and say, "Hey, I thought you guys were not gonna do any, you know, direct to consumer or direct marketing of the product." That's always possible.
At this point, we think there's so much room for us to navigate before we have to get there, where somebody hands us a patient, as Anthony described, and we're able to provide that service at a good margin.
Yeah, we're ascending into the place where they assign us the patients. They give us Mrs. Thomas's name, her phone number, her address, and perhaps a care gap closure or a chronic condition that she is managing. Then we go and address that patient, which is a very different process than us just going out, trying to find the patients. That really is where we're ascending into with these partnerships.
Yeah, appreciate the clarification on the evolution there.
Can you talk a bit about. David Larsen with BTIG, by the way. Can you talk a bit about your discussions with hospital systems? Like, obviously, the market's moving towards value-based care and capitation, but there's still plenty of CFOs who say: Hey, wait a minute, 60% of my book of business is still fee for service, or even if it's a case rate, that's still dependent on volume and admissions into the hospitals. Do you ever sort of encounter any pushback, or are the discussions more, "Hey, we love what you're doing, we love the reach into the community," and it's not even a concern?
Yeah, we really try to align our interests with the hospital. The first is, a lot of our work revolves around post-acute visits and making sure that patients don't boomerang back or be readmitted, because that's the last thing a hospital wants. They don't get any reimbursement for that. It actually negatively impacts their quality score metrics, negatively impacts their reimbursement. We're really focused on aligning ourselves with the hospitals to make sure that we're addressing that critical need for the hospital. They really don't want those patients to boomerang back. The second thing is, we really make sure that we're freeing up the beds, we're freeing up the capacity for the much more acute, higher-value patients that the hospitals are really interested in.
The other thing we're doing with public municipal hospitals is reducing the number of admissions that they don't get reimbursed at all for, right? We're catching patients earlier in the process before they precipitate a hospitalization, which then relieves the burden of the cost of those underserved patients on the municipal system itself. We're very aligned, depending on who we're working with the hospitals, we're very aligned there to make sure that we keep the right patients out. We also help manage the patients that are coming in, and manage capacity for the hospitals.
One key component is that the cost of the service that a health system pays us is so small compared to the benefit that they gain by either getting the patient out quicker or by changing the level of acuity of that patient, like moving them from fourth floor. Like, we have the ability to impact. Let's say an inpatient stay is $5,000-$10,000, and the cost of the actual encounter when you split it up on an hourly or whatever basis, it might be $200. It's an orders of magnitude difference in what they gain by using our services, and that significant ratio helps the sell.
Can you also talk about maybe the long-term potential or vision for health plan contracts? Like, I would imagine that you could, at some point, start bearing risk or performing in-home evaluations for MA plans. Like, any color around improvement in cost trend that you've been delivering to plans, like just any more thoughts there? Like, it seems as there's a lot of potential.
I'd say is that when you start care gap closure, and you start to have attribution of a patient from a primary care perspective, and you're monitoring them, and you're managing them for their chronic conditions, you're very, very well positioned, especially when you have a mobile medical team that can go in and impact care, both acute, episodic, and keep them out of the hospital and preventative. When you have that mobile footprint, and you're monitoring, and you're managing them, I can't think of any group that would ever be in a better position to benefit from the upside on a risk-bearing contract.
I would just add that, we started with the most complicated patients. It's not like we took concierge medicine and the best payers, the most compliant. The workflows all start with the most complicated patients who need the most access, so when you get those workflows, as you scale, it just makes it that much easier.
Next question. Not surprisingly, I think to most, Mayor Adams mentioned some national ambitions. I think in this context, he was talking about you.
Well, I'm not sure, but.
He talked about you replicating the model here and taking it mayor to mayor to other major cities. Can you talk a little bit about, you know, the, I guess, the nexus you have of helping with immigrants, helping with the homeless, but the bigger patient populations that would be coming from big city relationships, and sort of where that fits in today in your current model, your current RFP pipeline, and if those things start to come through, how you might scale, you know, in the context of all the resources you already have committed?
Let's talk a little bit about what we already have.
Yeah.
in the pipeline.
Yeah. Well, you can talk about the RFP?
Yeah.
Machine? Yeah. That, that business, we scale very deliberately, and we win very deliberately through the RFP process. All the governments procure their contracts and procure the, our services through that, through that RFP process. We're continuing to scale. We're growing the number of submissions, the size of the submissions. Then I will say, in every submission we do, there's a reference section, and I can't think of a better reference than the largest public health system in the entire country on speed dial, willing and able to receive that call and talk about the work we're doing. Every response that we do in that particular realm, we have that reference section, and we're going after a lot of those opportunities in the RFP submission.
I won't go into too many details about the ones we're actually submitting, but it's something we're looking at very specifically. Yeah, because we have a great track record, and we have some great experience to share.
I think the key that Mayor Adams said is that the problems that are in New York exist in every major city in the U.S., whether it's drug addiction, homelessness, whether it's the current asylum population that's coming in. Like, whatever those needs are, they're not unique to New York. We just are probably the only ones that have done it at this kind of scale. If somebody comes to you, let's say there's a county in Illinois that had an RFP, as an example, that wanted you to cover half a million members, to provide seven, eight different levels of clinical service to manage that population, there's not too many organizations in the US that can handle that kind of scale.
We've talked a lot about the governments, but I wanted to ask you about what you've learned and what you anticipate seeing on the, you know, the more retail side of it with. You know, you've had the opportunity to do some partnership work with Dollar General. I know Walmart has made a lot of noises about, you know, wanting to have a greater role in delivery of healthcare, nationally. I'd love to know, you know, what have you learned or seen out of your Dollar General partnership, and then kind of how do you see that evolving over time, you know, as a company and what you can do there?
I mean, it's important to understand what DocGo is. As I said, we're not a fee-for-service medical company, although there may be a lot of pressure from lots of groups that would love us to scale our model on a fee-for-service basis, that's just not who we are. Could we have scaled some of our other partnerships much more rapidly? Yeah, we could have. Again, you take on a risk. As Norm mentioned, as I mentioned, we've all mentioned multiple times, we do not wanna take risk on demand. If whatever the scenario is, whether it's retail or not, we're not going to be the ones that are taking the risk that one person shows up or 10 people show up on a given day. That is not who we are.
To make it work, you need to find a partnership. There is benefits to people. If you just go and you take a rural geography, real state, and you go to a state health organization, you say, "Look it, on a heat map, you have all of these areas where you have gaps of coverage. You have nobody. You have no primary care, you have no urgent care." For the, what their subsidy would be on our Leased Hour program, maybe it's $200 a day, $250 a day, because we're still billing insurance. It's just they're paying whatever the delta is in order to ensure that we can have that downside margin protection.
You can go and say that for this whole county, for this whole region, where you have no healthcare access today, no primary care, no urgent care, for $250 a day, you have the ability to have that access. When we wanna grow, as we expanded, and that's what we're actually doing in Nashville right now. We have the Dollar General clinic that we have right now is a partnership between us, Tennessee Department of Health, and obviously, DocGo, providing the clinical care that allows us to have that downside margin protection, but still have the benefit of a low CAC, because you're building off of the existing visitor, the existing sales that are coming into that retail store.
I will add. You're touching on something which we're seeing a trend in, which is this retail healthcare wars. Every retailer, once again, the space, you named a few. We feel so lucky and fortunate to have Dollar General as really our key partner there, and I can't tell you how many times since we announced that, how many other retailers reached out to us. We consider ourselves so fortunate to have Dollar General because they have 19,000 stores across the entire country in a myriad of different locations, with different demographics, different access to care, and that's what we're studying right now. What does the access to care look like? What are the demographics of the store? What is the patient concentration? I can tell you, the service, the patients love, and we're very deliberate in what we scale.
A lot of the things we shared today, we've been working on for many years at this point. When we feel like we have the right recipe, with the right store selection, with the right mix, I think there's gonna be an opportunity there, but you won't see us scaling until we can really identify that formula that we feel very confident in, and that's really, you know, how we decide when and how to scale.
We have time for one more question.
Richard Close, Canaccord Genuity. Just on the remote patient monitoring, if we could dig into that a little bit more. I'm just curious, Norm, you said something about the reimbursement change. There's been some there. How, how big of a. And when you're managing the downside risk, you know, that the codes go away. I mean, you have a slide further in here that it shows it going to $16 billion-$17 billion, total mark, addressable market. Just curious, you know, if sometimes CMS pops their head up and says: Hey, you know, this is a real big number now.
Yeah, good questions. Very good questions. I think one we're talking about was on the CIED space, which is kind of already through its rediscussion. RPM and CCM are. RPM is newer. CCM is not. CCM has been around for a little while. I think the key, though, is to focus on the management, not the monitoring. If there's anything by which there could potentially be, I wouldn't say necessarily risk, but reevaluation, it could be on the monitoring that's not paired with management. One might say, "You're monitoring, but are you actually impacting care to reduce cost and deliver better patient outcomes?" We manage across the board, whether it's PCM, which is one chronic condition, or CCM, which is two or more chronic conditions. Nearly all of the patients that we have, we're managing, not just monitoring.
That's really the emphasis there, and it's because we choose to focus on it. A lot of companies that go into RPM, they will choose, like, a primary care practice, and they're monitoring people that are not really that sick. We go in, and we are dealing with cardiology practices, with some of the sickest people in the country. We're dealing with nephrology practices, with patients who have end-stage renal disease, who are the sickest, who have the largest spend of any type of patient in the United States. Since we're focusing on the ones that are truly the sickest of the sick, we have to manage them chronically and very with a lot of complexity. I don't think you're ever gonna see...
If anything, I think you're going to see larger and larger upside in that area, because if you just slightly improve the care of a patient with CHF, or you slightly improve the care of a patient with end-stage renal disease, the dollar value improvements are, you know, two orders of magnitude greater. I think that is what we have for our last question. We have a couple more just closing and summary slides that we're going to do. Thank you.
Okay.
This will be over.
This will be so fast.
Off you take this. I do want to say, I appreciate all of you so much for being here today. It really means a lot. I know a lot of you flew in from around the country. See so many faces, so many people that have invested in DocGo. Many people have invested in DocGo for a very, very long time, and to have that faith in us, one thing that I can tell you, one thing that I can promise you, is that you'll never meet a team who will fight harder to make your investment dollars worthwhile. Let me bring it back in a little bit of a summary here. DocGo is delivering proactive healthcare, powered by our proprietary technology and our thousands of skilled clinicians. Our care delivery model is achieved with extremely low customer acquisition costs, leading to very significant growth.
Our proactive care delivery model, combined with a proprietary technology platform, creates a differentiated solution that we believe is unique within the market. DocGo bridges multiple areas of healthcare, from population health to telehealth, urgent care, primary care, and even ambulance transportation. We've shown you how we believe DocGo is at the front of the market, leading the proactive healthcare revolution. Let's talk about how we stay there. DocGo has continued to grow what we believe is a competitive moat through the expansion of our proprietary technology and integrations, as we saw through Hawk's demos. Our rapidly deployable staff allows us to take advantage of opportunities as they arise, capturing new customers and securing foundations for future contracts and growth.
Our clinical practice group, led by Dr. James Powell, helps us strive for clinical excellence and offer exceptional care at lower costs than traditional, primary, and urgent care models. A key part of our success comes from our same-store sales strategy. We have a history of successfully expanding our relationships with customers to include multiple additional services and product lines. For example, our health systems usually start by using our ambulance services, and then they expand to other mobile health services, such as our readmission avoidance programs.
Municipalities and health systems, on the flip side, usually start by leveraging our mobile health programs, and then they expand into medical transportation and other services. We anticipate our total addressable market to increase rapidly over the next three to five years. We have built a foundation for growth in our virtual care and remote patient monitoring platform because that market is projected for explosive growth.
The services and software segment of the remote patient monitoring market is anticipated to grow from its current state of $6.4 billion to $16.9 billion by 2030, a 32.8% compound annual growth rate. Most importantly, we are executors with a proven record of strong financial performance and operational excellence. Key members of our organization and managerial staff have been working together for many years, and we've taken DocGo to this point and are poised for even greater growth. We've added more world-class leadership talent to the roster over the past one to two years that are ready to take the company to the next level. We have a passionate, talented leadership team ready to lead the next phase of DocGo's growth. We help people stay out of the hospital. That's the big idea of proactive healthcare. Thank you all.