My name is Daniel Grosslight, Health Tech and Distribution Analyst. Seth, I think let's jump right into the controversy here. I don't want to rehash what other folks can kind of read in your earnings transcripts of what happened. Last quarter's earnings, we did see a pretty big and unexpected increase in medical costs. I think most folks that I spoke to going into the quarter expected to see some increase, just given what managed care had said. I guess it was the quantum of the increase in commentary around what needs to be done to offset that caused a few questions. Maybe if you can spend a few minutes laying out what happened. Again, we don't need the bloody, the gory detail here. What happened? Why did this catch off guard?
I guess, more importantly, what can you do to offset some of these pressures?
Yep. Great question. So I'll keep it simple. And then let's follow-up questions if you want to go deeper. But essentially, we had two issues hit us at the same time in the quarter. One issue was the actual in-quarter utilization increase, mostly in oncology. And then the second issue was prior period effects of oncology, some cardiology, higher claims costs. And these are claims that we had not received previously, largely due to two different payers, two separate unrelated IT issues of not receiving the right claims. And I think the double effect of that obviously hit all in one quarter. I think if we had had the information from the payers earlier, you would have seen the same ultimate cost. It just would have been spread out across the year. And we would have gone back for the rate increases that we're talking about now earlier.
So I think it was really a function of two things hitting at once that should have been spread across three quarters that sort of hit in one quarter. I think in terms of what to do about it into the future, look, I think fundamentally we have a fantastic product that our payers like. And so we're going to go down a path. And path A with these payers where we're having issues on our medical loss ratio is to flip it to a technology and services model. And we have a contractual right to do that in all cases of these relationships that we're talking about here. Path B would be to renegotiate the risk arrangement to both increase the rates, but also put some corridors around the relationships such that we have less downside exposure in those arrangements.
And I think we're obviously in the midst of those conversations right now. I think we'll have definitive clarity, I believe, by February and be able to communicate where those landed. I think the good news is that if we get the terms that we need and we believe we can get around corridors and rates, those will be great Performance Suite contracts. If we can't get a line done on those, the Tech Services arrangement we believe will be very sticky in those situations. So either way, I think we have a good path to right-sizing the economics and getting back to a good place. And then the last thing I'd say, Daniel, is that the flip side of this same issue that's causing the trend is causing tremendous demand in the product. So we're seeing incredible pipeline interest.
The new Performance Suite relationship we signed has these protections that we've been describing in it. And I think demonstrates the desire that a lot of these plans have in getting help on oncology costs. It's a big problem right now.
Yeah. Yeah. Thanks. That's a good kind of way to level set. Let's dig into those two options, the corridors and then the flipping to Tech and Services. One, I guess first question, do you have a preference one over the other? And then secondly, as we think about the mechanics, maybe go into a little bit more detail on what a corridor actually looks like, how that is different from your current Performance Suite contract. And what does that mean for your margin progression and margins at maturity within those contracts?
Yep. All right. So look, we're really talking about three primary relationships here. And I think if we can get the right terms the quarter, which I'll talk about in a second, and the right protections, the Performance Suite model continues to be the best model for our clients, the best for patients, the best for physicians. We put a lot more resources into the market. We create more value. And ultimately, I think have better economics on everyone's side. If you can have even a 10% margin on a $40 PMPM, that $4 is always going to be bigger than the percent margin that you can have on the Tech Services side. Now, if we can't get the protections, as I mentioned, then we'll go to the Tech Services because I think it's a bit of a line in the sand for us going forward.
I also think the payers have shifted, Daniel, their willingness to do things because I think they feel a lot of pressure on oncology too. And so I'm hopeful that we can land on those sort of adjusted Performance Suite models. My guess is you'll have some mix of maybe a few relationships do that. There might be one relationship that goes to Tech Services. Or maybe we can maintain all three under Performance Suite. Either way, I think we feel really good about retaining the relationships. And that's been a question that people have had. And I feel really good about the dynamic, the relationship we have with these folks and our ability to retain the relationship. In terms of the corridor model, to your question, I'll just use an illustrative example to keep it simple.
But essentially, it would say, "Hey, Evolent obviously is not increasing the cost of oncology." And so we don't want to have an MLR that goes above name the number, but it would have a hard cap. And above that point, Evolent doesn't have exposure because it must be something that's outside of our control. And on the converse, we'd likely have a floor on the arrangement that might mean that our profitability at maturity would be slightly lower. So you sort of end up with a product that's in between Tech Services and Performance Suite, lower volatility, maybe a little bit less profitable on the very, very top end of the arrangements. Most of the shareholder feedback we've gotten has been that that is a trade that people would take. And I think it is something that our customers also understand.
And I think, again, really value what we do. And I think there's a good chance that we can have those sorts of arrangements put in place.
So if we do those corridor contracts or if the three, I guess it's really the three problem contracts convert to corridors or agree to have corridors, we're looking at 10% margins at maturity versus 15%, call it. If they flip to Tech and Services, remind us, what's the margin profile and margin progression of that type of contract?
Yeah. So Tech Services is going to be full margin maturity on day one. It doesn't have a maturation path. It tends to be about 50% margin. But obviously, the fee is much lower. So it's a higher margin percentage, but a significantly lower margin dollar basis. Doesn't have the volatility, the up and the down, but it's very consistent. So I think there's a natural trade-off on multiple of the business probably between the two. But again, we think the Performance Suite with some protections continues to be a very attractive product.
Yep. Yep. So safe to assume that if these contracts flip to Tech and Services in year one, 2025, better for EBITDA because it'll be immediately EBITDA, contributing to EBITDA. But from a longer-term standpoint, not as much opportunity on a dollar perspective.
I think that's a very fair characterization. I also want to be thoughtful and careful about I think there are versions of the corridor depending on how it's designed where it could be more than 10%. That's just an example. But I do think the concept of lower volatility product that is somewhere in between Tech Services and the old Performance Suite is the right way to think about it.
Yep. Got it. And so those are the three that will renew by January, hopefully?
Yeah. I think I'm confident we'll have something done by February for all those that may be by January.
OK. And what about the rest of your Performance Suite book? How does that flow through to other contracts that aren't as problematic?
Yeah. Look, for the balance of them where we are in a decent place today, I think we will seek to have these sorts of terms that I'm describing added to the contract next time there's an opening to do so. A lot of these contracts, if they're performing well or in a decent zone, we may not touch it right now. But upon renewal, we would be planning to add these same contract terms.
OK. And of those three contracts, maybe just provide a little bit more detail on what they look like. Are they Medicare, Medicaid, oncology, cardio? What are they? And then I guess also, from a rate increase perspective, is one dominant over the other? Or are they all kind of evenly split?
Yeah. Across these three contracts, it's actually pretty diversified. Medicare, Medicaid, some commercial, cardio, onco. I wouldn't describe one of them as dwarfing the others. It's pretty balanced across the three.
OK. Let's talk about the rate increases. I think that's kind of the restructuring of contracts, the corridors, the Tech and Services. That's one area. But I think perhaps equally, if not more important, at least for the near term, is actually getting the $100 million of rate increases, which you've kind of put a line in the sand for next year. $45 million of this is [Formula 8]. So there shouldn't be any issue with $45 million. So it's really that $55 million, which is kind of debatable. What gives you the confidence that you'll be able to collect on that $55 million, particularly given you just had this rate increase this past summer? Managed care, they're not doing great in their government books of business. So kind of what gives you that confidence on that $55 million?
Yeah. Look, I think the dynamic, Daniel, is that if we can't align on something reasonable on that $55 million and the related corridor terms, then we have the option to do the Tech Services model. And the Tech Services model, from our perspective, is still a great product. It's strongly profitable. And it's attractive for us. So we're fine doing that if we can't. So I think the fact that we have an alternative to continue supporting the patients and the physicians and continuing what I believe is truly world-class clinical interventions for our payers, we have that alternative. I think that's what gives us the confidence. And look, our mission, continue to do this great clinical work, stays in place. And we still have a very nice margin contract. And so I think that backstop is really the key to that confidence.
OK. And you think if you do convert to Tech and Services because your product is so good, you're not going to see a bunch of attrition because, I don't know, from a managed care organization, I like Evolent because I can hit my MLR?
Correct. I do feel confident in that.
OK. What did you learn over the summer with your previous rate negotiations that you can use during this round of negotiations?
Yeah. Look, I think we did a lot of work that we do anyway throughout every year, which is taking out the data and sharing with our clients how much value clinically are we creating relative to their next best alternative. So that could be another company, or it could be some other way of managing this, and I think even for us and our customers relative to that review we do on an ongoing basis, I think it was eye-opening the quality of clinical impact we're having, which, again, speaks to this issue of like, look, we got to figure out the contract to make it fair, fair for the client, fair for us, fair for the docs. Those things have to be true, but if we're creating enough value and more than the other alternatives in the market, that to me is the bedrock.
And you'll figure out the contract. That is the most important thing we learned. I think we built confidence with our customers, our teams, everybody on that issue. And I feel like that's the foundation for all this, which is our confidence that the product is really fundamentally clinically differentiated.
Yeah. And today, there was some news around Humana and their CFO. Just curious, does that change the dynamic at all with Humana? Obviously, they're a big customer of yours. Or is it kind of just a non-issue for you guys?
Yeah. Non-issue for us. We tend to deal with the teams that are specific to each operating area. And so I don't think it'll be an issue for us at all. It's a great organization. Got a lot of depth at Humana. Not concerned about it.
OK. One other initiative you mentioned in terms of kind of rewriting some of these contracts is being more [Formula 8], being more like that $45 million of rate increases that you're going to get next year versus that $55 million where there is this debate and negotiation. Can you just walk us through what does that mean in practice? How does that work mechanically?
Yeah. Look, the main adjuster that we need to have in our contracts is around the prevalence and case mix of the population. So if a lot of people get cancer, higher percentage in a population because of post-COVID, because a given MA plan in a given state doubled in size and attracted a bunch of members who were sicker, all sorts of issues, we need to make sure that those adjustments are made. Because we obviously can't control the number of people who get cancer. We can only control the quality and cost of the treatment. So that's the main adjuster. We have that in most cases. We'll be adding it to any other contract going forward. Obviously, if you also have the corridor, Daniel, I'd say that somewhat softens the impact of that term.
And to me, the corridor ends up being probably the most important thing on a go-forward basis. Because there's a lot of things that can shift trend even beyond prevalence and case mix.
Yep. Yep. On the Medicaid side of the business, a few of your clients have been able to go back to the states and get some off-cycle rate increases just given some of the change in acuity in their books. Obviously, you guys are priced off of cost and not the rate that they get. But I'm wondering, is there an ability to go back to those clients who did get a rate increase and say, hey, you got some. Can I have some as well? Or conversely, can you write that into your future contracts?
Yeah. So the short answer is I think we are having those conversations. To us, it's a very logical thing. And on the flip side, during COVID, when a lot of things happened that adjusted in the other direction, we were good partners in sharing back with our customers. So I think it's all part of a partnership. And I believe our plans will be reasonable on that question because they kind of get the issue. And again, I do think those sorts of protections could be added to future contracts, Daniel. Again, if we have the corridor and the right model to begin with, it makes each little one-off protection a little less crucial. And I think we're sort of putting our bets on the blunt instrument of the corridor more than each nuanced issue like the one you're describing.
Yeah. Yeah. So it sounds like in terms of just preference, one, you're going after the corridors. Two, if no corridors, you're going to convert to Tech and Services. And then maybe you kind of tweak the existing Performance Suite, the non-troubled ones so that some of these issues go away.
Correct. Correct.
OK. Let's go back to the increase in medical expenses that you laid out last quarter. So around $40 million-$42 million of elevated expenses. And one of the more surprising things there was the $24 million of expenses that were really due to revised claims. And you kind of alluded to this. So I guess you also mentioned you're in the process of auditing those. I'm wondering if you can go into a little more detail on how something like that can happen and how you can prevent that from happening going forward?
Yeah. Look, I mean, so the issue specifically, there were two plans, both with different unrelated IT issues where they were essentially filtering out a set of claims that we should have been receiving that we weren't getting. I think the plans have been under a tremendous amount of pressure and have had a bunch of their own pressure that I think contributes to issues like that. The way I think about it, Daniel, let's assume we get through the audit process and there's not some huge reversal of those. The way I think about it is you take that $24 million and spread it back across the first part of the year where they should have lived to begin with, and you sort of have a more true picture of a post-COVID utilization environment that it's not a $42 million issue in any one quarter.
It'd be closer to a low-teens issue across three quarters each quarter. And that's the kind of thing that we're working on fixing on a go-forward basis. And again, if we get the corridor in place, we're also asking for some sort of hard boundaries on by when we need to have what data, which will be part of that. But if we have those things in place, get the right rates, I think suddenly the business is right back in a really good place. And as I've been saying, I do believe the pressure on these plans around cancer, cardio, et cetera, is very significant. And so the growth opportunity off the backs of this, we think, is very strong.
Yeah. Yeah. And on the tech issues, I assume that's mostly on the payer side. So it's not something that you can.
Correct. That was a payer-specific issue. Correct.
Got it. OK. So there's really, other than saying, hey, if you don't get us these claims by X date, we're not taking care of them, there's nothing else to do.
Correct. I mean, we've obviously gone back and fixed those two issues with our partners and have checked to make sure there are none of those issues in other places. But I think the best way you can't guarantee that you fixed every IT issue into perpetuity. So I think we're thinking of it more around contractual protections on the corridor side and on the data side as the safest way to protect in the future.
Got it. OK. Now, as we think about your go-to-market strategy in 2025 and beyond, historically, a lot of your growth has been driven by the Performance Suite. Do you think that that's going to continue going forward? Or does it really depend on what happens with these negotiations on if you kind of shift more to Tech and Services versus Performance Suite?
Yeah. Look, I mean, it's a great question. I do believe the Performance Suite will continue to be a strong driver. What I'll call Performance Suite 2.0, like an adjusted version of that, I think is going to be a strong driver. The deal we announced with one of the five biggest plans in the country in the recent quarter has a lot of these protections that we're talking about and feels like a good example of the opportunities ahead. We have more of those in our pipeline. So I do think that's going to continue. Might you see a slightly higher mix of Tech Services because we're insisting on these terms? I think that's possible. But I don't think it's going to be dramatic. If you had to ask my sort of prognostication on the future, I think we're going to still see a lot of Performance Suite.
Yeah. Yeah. And that makes sense. But I guess the important point is you're going to demand these protections. You're not going to go back to the Performance Suite 1.0.
It will be a bright line on holding the terms on the 2.0 structure.
Yeah. Yeah. We're a week into December. I don't know how much visibility you have into November at this point in time. But it'd be great just to get an update on how utilization has compared in November versus your initial expectations.
Yeah. So we don't have the November data fully baked enough to be able to share anything. I would say the October data, which we talked a little bit about last week, is inside of our expectation range. So our Q4 guidance of $22 million-$37 million, the information came in as a consistent fashion to that range. Obviously, it's only one month. And we got to get all three months in the quarter. But feels right now like everything's consistent with what we said on the last call.
OK. Good. Good. And when do you think you might have more detail on how November's shaping up?
I think probably the next time we'll be having a conversation will be in January as part of the JP Morgan conference.
Gotcha. OK. So we spent a lot of time on how you can kind of protect yourself on the MLR front. What about on the OPEX front? Maybe just go into a bit more detail on kind of the OPEX load of a typical Performance Suite contract. And you did mention that you're streamlining OPEX costs as well. What can you cut there?
Yeah. Look, I'd say if you think about operating costs in two buckets of SG&A and cost of goods sold or the operating costs on a variable basis, we've done a lot on the SG&A side over the last few years integrating acquisitions and the like. And we don't want to, I'd say, overly cut there because we see such a growth opportunity. And we want to keep delivering for our customers. So the SG&A side, I think, is going to be limited. On the operating cost of goods sold side, I think the Machinify acquisition and what we're doing on AI is going to be material and significant. We'll get some of that this year, but really headed into 2026, I expect to see a pretty big impact there.
Yeah. Maybe go into a little bit more detail around Machinify and how you are using AI currently?
Yeah. So look, I think the best way for people to think about this who may be a little newer to the business, we have about 1,800 clinicians in the company, 300 physicians, close to 1,500 nurses. A lot of the work that the 1,500 nurses do, that work, as we grow, we think we can keep that base of staff very flat even as we grow significantly because the AI engine will allow each of those nurses to be more and more and more productive. So if something used to take them 18 minutes to do per case with AI, they can do it in 9 or 12 minutes depending on the type of service. So as that ramps and we apply it, we're going to go specialty by specialty. We think we could close to double the productivity of a nurse.
The physicians, on the other hand, those to us are the conversations we want to be having. We do about 1,000 peer-to-peer conversations a day. That's physician to physician. And that's the heart and soul of Evolent. Over 100 an hour, we're doing conversations on an oncologist to an oncologist about the opportunity to make a change in a care plan. And there, I think I would expect AI makes us a little more efficient. But you sort of want those conversations to be happening as they are today. And a lot of the efficiency will happen on the nursing side.
Right. Right. OK. Let's go back to what you guys can control. We're talking about, let's stick to oncology. You pointed out kind of three buckets of kind of what caused this increase in expenses. There's acuity, nothing you can do there. There's the use of more combos. I don't suppose, is there anything you can do there to encourage or kind of create pathways for more efficient combos. And then third is just the innovation, which, again, I suppose there's very limited freedom to operate there. So just curious on those three buckets, what can you control? What can't you control? And you listen to the distributors, all the pharma companies that are here today. Specialty is going to continue to grow very rapidly.
Great question. And I'll probably add a fourth, Daniel, which is total prevalence, meaning how many people are getting cancer. So I'd say that'd be the fourth. So if the first one is acuity and the fourth one is how many people with prevalence are getting cancer, those are the two we don't control very well. The middle two on combos and on innovation, I think we do have a big impact. So the two pharma levers are big, big impacts. And the easiest way to communicate it from my perspective is when we show up in a market where we haven't been doing work, the adherence to our level one pathway is usually below 65%, meaning 35%-40% of the time the patient's not getting the ideal treatment plan.
That could be because they're getting a combo treatment plan, a duration of care, a surgical intervention. Go down the list of things that we think are either they're just not the right answer for the patient. Most of the time, those things are lower cost. Sometimes they're more expensive to make the changes. So by going from 65% to 80%, Daniel, we drive the savings. 80%, 85%, we drive the savings that we do. And we can do a lot about those things.
And it's everything from. I'll even give you an example where you might encourage the companion treatment, which is if based on our data, our analysis, and the published literature, you know you're going to eventually get to the companion therapeutic or an immunotherapy or even a cell therapy, and you're going to do it three, four, five months down the road after wasting $15,000 and a bunch of the patient's time. And by the way, the tumor's progressing. We would actually just cut out that first step and go to the second step, which is more expensive on a monthly basis, but you were going to get there anyway. So if it's my family member getting treated, great. They're getting the best treatment earlier. And you're saving $25,000 of the first step in the therapy, which wasn't going to work anyway. So sometimes you're actually encouraging the use.
It could be the opposite in a different example. But again, 35% of the time, there's something like that we can do.
Got it. OK. OK. I don't want to kind of get lost in the conversation. We've focused a lot on Performance Suite and kind of rejiggering those contracts. But you guys do continue to kind of outperform in terms of new contract signs. So maybe if you can also just talk about the overall environment for and demand for your products, what's driving that? Have you seen any change in the market, whether it's on kind of the demand side for your product or also the competitive kind of set out there?
That's my favorite question so far. Yes. The demand is very strong right now. And I think that the driver, again, is that so Evolent covers about 180,000 cancer cases a year nationally. There's about 2 million new cancer starts a year in the country. So we have less than 10% of the cancer that we help manage in the country. So in that other 90+% of cases that our existing payers have or a new payer has, they are generally going to be experiencing a trend that is very significantly higher than even what we're experiencing. And I think that demand is causing that plus the overall pressure in the payer environment is causing a lot of interest in like, hey, can you help us on this issue?
I can name three marquee big logos who have reached out to us in the last four months to say, "Give us your pitch on oncology." Those processes have started, and we're underway and having those conversations right now.
And as we think about the areas that you're in right now, cardio as well as oncology and newer MSK, where are you seeing the most demand in oncology still? Are you seeing it kind of more mixed? How is the demand shaping up?
Yeah. It's a great question. I mean, we're talking most about oncology today because it's been the biggest trend driver. But I just saw an email this morning from a major payer reaching out about MSK. And there's three or four cardio pursuits that are underway with very large payers too. So I think people on the payer side are turning over every stone right now to try to manage trend. And those three are the big three. So if you were going to pick a list of three specialties to go solve as a payer, you're always going to include those three. So I think it's going to be across all of them with a kind of a little accelerator on the oncology side.
Got it. I do want to open up the questions to the floor here. We do have a mic runner. So if anyone has a question, please don't be shy. Raise your hand and we can get you a mic. OK. Doesn't look like any questions. So let's go back to your capital deployment priorities. You obviously have got a convertible debt coming due in 2025. You put into place $250 million of financing, which I suppose will be partially used to take that debt out. How are you balancing some of your kind of debt pay down priorities vis-à-vis some of the organic growth opportunities you have?
Yep. Yeah. Look, I think our first priority in this environment will be to pay down the debt and have our leverage ratio, even though it's pretty modest already, continue to come down. I think our organic growth opportunities will not be a drag on capital. With the terms that we're going to agree to for any new Performance Suite contract, we won't have that downside risk. And then on Tech Services, it's obviously accretive immediately. And then lastly, we're not oriented around M&A in the short term, just given our focus on getting the business to a really good foundation baseline.
Got it. OK. And as we think about kind of 2025 and beyond, assuming that you get your rate increases, assuming that you are able to restructure some of these contracts to get your corridors as well, what should we think, realizing you're not guiding today? How should we think about kind of what the baseline run rate should be heading into 2025? You've guided to 2024, which implies kind of a low 20s, EBITDA in 4Q, $20 million or so. Should we just kind of annualize that and add $100 million to that and say, OK, that is our baseline, which would be $180 million or so? Or how should we kind of think about that and its relation to that $300 million in run rate EBITDA that was in place before 3Q?
Yeah. Great question. So look, I think it really goes back to the question you asked earlier of what's best for 2025 versus what's best for 2026 and beyond. Retaining some portion of the Performance Suite, we think, is going to be the best opportunity for the business to move back towards that $300 million. Implied in that is a model where you may have some months in 2025 where you have some of that that is less profitable as you either head towards a conversion to Tech Services or you agree to sort of take in a relationship where you're going to have a corridor model. I think it's going to be a trade-off on a bunch of those things.
The third element that we can play off is what if one of our plans would give us a very significant contract for 2026 or late 2025 as part of setting up an arrangement. And so I think there are going to be a lot of trade-off questions on short versus long term. I do think where you started, we made this comment of like $50 million a quarter. If you flipped all the unprofitable relationships to Tech services, that would be post this sort of 150-day period later next year, all of the things being equal. So I think a long way of saying there are a bunch of factors we're balancing. I think it's going to depend on where the relationship negotiation ends and how much we sort of focus on 2025 versus the long-term profitability and getting back to that $300 million.
Got it. OK. And then I guess there is a timing issue too. You mentioned the 150 days notice when you flip to Tech and Services. In that interim period for the first couple of months of 2025, you're going to have a run-out of claims on the Performance Suite. So there might be a little bit of a mismatch between what you're getting on the PMPM side and your cost. So should we expect a little more volatility in the first quarter, perhaps second quarter this year? Should there be a flip to more Tech and Services?
Yeah. Look, I mean, I think it depends on where these all land. If you flip more quickly to Tech and Services, you'd have less of that. If you adjusted the rates for 1/1, you'd have less of that. So, I think it's hard to, obviously, without giving the full guidance, comment on that right now. But I think in general, the one thing I do feel very confident in is by February, I think we'll have a very clear line of sight. These relationships, I believe, will be fully renegotiated, and we'll be able to talk clearly about that.
Got it. OK. Lots to look forward to in January and February. I guess we'll just end it with a question on the political environment, given we're about a month out from the election. We know pretty much who President-elect Trump's nominees will be. Who knows if they'll actually be confirmed? But I'm curious if this new administration in any way may have an impact on you guys, whether it's kind of less Medicaid, more Medicare, less exchange. How do you think the political environment impacts you guys?
Yeah. It's a great question. I mean, I'll give you the very simple answer to start with, which I don't think it'll affect us very much one way or the other. And again, most of what we do is with private payers. And they are solving their own issues. I think probably Medicare up a little bit, Medicaid down a little bit. But we have more Medicare than Medicaid today. I think that all somewhat washes out. I think the one thing that everybody agrees on that I've talked to and having talked to some of the likely candidates for different positions in CMS, I do think the Trump administration will be more pro-value-based care, interestingly, and more likely to see maybe some more opportunities coming out of CMMI around specialty care and just generally a more supportive environment for value-based care.
I don't think that has a huge impact on the company in the short term, maybe in the medium term and I think in general, probably not a huge impact from the election.
Got it. So potentially, and we didn't really talk about your ACO, but you do have an ACO that performs quite well, potentially investing more into the ACO business.
That. And then also, there have been what I would call specialty value-based care models that have been piloted through CMMI. They've not done as much of that over the last four years. I could see more of that being put back on the table over the next few years. And that would be a positive for us. Again, that'll benefit us in 2027 and beyond. But I think that's likely a positive from the Trump administration.
Got it. OK. Well, we've got about two minutes left. I know there's a lot. I get a lot of questions around you guys, a lot of confusion. Anything that we didn't cover that you think is important to get out there to, I don't know, maybe calm people's nerves or make more sense of what is out there right now?
Yeah. Look, I mean, until we give guidance, I think that'll be the main thing that helps people. But I'd say in the interim, I'm a bit biased, but I think it's a fantastic team. We've been around for a long time. And I think we're going to, I think, have a lot of confidence to get this right because the product is really good. The customer product-market fit is really high. And the need is really strong right now. I think that formula sets us up well to get these contracts set up to make for a very high-quality business. And I'm very confident in that. And we're going to be working our tails off between now and February.
Yes. It'll be a busy holiday season for the Evolent team.
Yes, it will.
Thank you, Seth.
Thank you.
[Thanks] Seth, for joining us today. Thanks, all, for listening. Have a great rest of your conference.
Thanks, Daniel. Appreciate it.