Earnings Call: Q2 2016

Aug 3, 2016

Good afternoon. My name is Mike, and I will be your conference operator today. At this time, I would like to welcome everyone to the Teladoc 2Q 'sixteen Earnings Release Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session. I will now turn the call over to Adam Vander Voort, Teladoc's Chief Legal Officer. May begin your conference. Thank you and good afternoon. I'm Adam Vandervoort, Teladoc's Chief Legal Officer. Teladoc intends to avail itself of the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Certain statements made during this call will be forward looking statements within the meaning of that law. These forward looking statements are subject to risks, uncertainties and other factors that could cause Teladoc's actual results to differ materially from those expressed or implied by the forward looking statements. For additional information on the risks facing Teladoc, please refer to our filings with the SEC. I'll now turn the call over to Jason Gorevic, President and Chief Executive Officer of Teladoc. Jason? Thanks, Adam. Welcome everyone on the call and thank you for joining us this afternoon to review our Q2 2016 results. The Q2 saw continued strong year over year momentum in our business with revenue of $26,500,000 an increase of 45 percent membership 15,400,000 members, an increase of 34% and visits of over 199,000 visits this quarter, an increase of 59%. Adjusted EBITDA loss was $10,500,000 an improvement of approximately 27% year over year and 12% sequentially. Feeling a little bit of Mark's thunder, I'd like to start with our adjusted EBITDA for the quarter. We've said consistently that this would be the quarter in which our bottom line results began to improve and that we expect this trend to continue for the next 6 quarters on route to EBITDA breakeven in the Q4 of 2017. Consistent with this, our 2nd quarter losses were reduced by $1,400,000 versus the Q1 of this year, as we have begun to realize leverage from the scale of our operations. Next, I'd like to highlight yet another strong quarter with respect to visit volume. With visits increasing at nearly twice the rate of membership growth, we continue to deliver more value for our clients every quarter. As we've discussed before, seasonality causes our visit volume to be lower in the 2nd and third calendar quarters and higher in the 1st and 4th quarters. In spite of being in the seasonal low, we delivered nearly 200,000 visits making good on our promise of industry leading consumer engagement. During the Q2, we also saw continued new client momentum with wins across multiple market segments. Teladoc has been selected by Tenet Healthcare to be the telehealth solution for the Valley Baptist Hospital in Texas. We've also been selected by Silver Cross Hospital in the Chicago market. In addition to these new hospital clients, I'm happy to report that we've launched a partnership with CareCentrix in the home care space. Under this model, we will work with CareCentrix to provide telehealth services for their HomeStar Readmission Avoidance Program targeted at patients who are post acute or recently discharged from a skilled nursing facility. Turning to other market segments, we continue to see strong adoption by employers with new sales including companies like Progressive Insurance, the National Rural Electric Cooperative, Greyhound Lines and New Era. Further, the Teladoc solution continues to be embraced by state and local governments with the North Carolina League of Municipalities and the County of San Bernardino, California employees, which are scheduled to go live during this year and the 50,000 employees in the state of Alabama account scheduled to go live on Oneonetwenty 17. And growth in our Health Plan segment continues as well. With new accounts, San Francisco Health Plan and Health First in New York scheduled to go live on Oneonetwenty 17 as well. Equally encouraging, we're seeing tremendous traction in some of our recently implemented clients. 1 of our Fortune 500 companies went live with about 40,000 employees on July 1 with multiple Teladoc solutions and we're already seeing great utilization trends across the entire product suite that is well ahead of our expectations. In addition to strong engagement with our general medical product, their employees performed nearly 50 behavioral health and dermatology visits in their very first month with Teladoc. While the Q2 saw strength in terms of new client wins and positive trends in utilization, revenue was below our expectations. The primary reason for the revenue shortfall was the cost of advertising in our direct to consumer behavioral health business. This advertising was more expensive in the 2nd quarter on a per unit basis or per ad basis. And because we have fixed advertising spend in any given quarter, we placed fewer ads than in past quarters. Ultimately, this led to lower yields per dollar spent. We've adjusted our advertising strategies and diversified our consumer engagement efforts in order to address this issue going forward. While I'm disappointed that our revenue came in below our guidance, I'm still very pleased with our accomplishments in the quarter and the adaptations that we've made in order to address this issue. Turning to a couple of other key topics. As most of you know, on July 1, we closed on our acquisition of Healthiest You, the leading telehealth consumer engagement technology platform for the small to midsized employer market. We've now had Healthiest You under our belt for about 5 weeks and things are right on track with our plan. We've had excellent response from the market, including existing Healthiest You customers, brokers and prospects, as well as Teladoc customers and distribution channels who are anxious to have access to the expanded capabilities that the combined entity will offer. As you may recall, Healthiest U had previously outsourced the delivery of their telehealth visits to one of our competitors. Following our close, we successfully transitioned the entire Healthiest You volume to the Teladoc platform. Because of the scalable Teladoc infrastructure, we were able to absorb this additional 8% in visit volume and 10% in call volume without adding any personnel or infrastructure. This is a true testament to the leverage that we get at this scale. I want to share a bit of insight into our Client Summit, which we hosted in May. At this event, we had 12 large Teladoc clients gather to provide feedback, preview our product roadmap and provide commentary on how Teladoc can provide those clients with more value. Client satisfaction remains a priority for us and it was very encouraging to hear directly from our clients that they really like what we do they're happy to be able to offer our solutions to their members. Based on the strong positive feedback from these and other clients regarding our behavioral health product in particular, we have decided to further invest our resources in behavioral health and in the Healthiest You product integration rather than expanding into additional specialties such as diabetes for the remainder of this year. We think that this strategic allocation of resources will maximize the value for our customers and the return for our investors. Overall, this was a good quarter for Teladoc with continued demand and momentum in our business. Before I turn the call over to Mark to review the 2nd quarter financials in more detail, I'd like to provide some color on customer retention and the selling season for Q1 2017 business. As we've discussed before, we saw abnormally high customer churn in 2015 due to a confluence of events. I'm happy to report that for the first half of twenty sixteen, we have returned to our historical customer retention rates of over 95%. This gives us confidence in our ability to deliver on our growth expectations for 2017 since we don't expect to have the magnitude of churn to overcome that we did entering January of 2016. We are now right in the middle of our selling season and the pipeline is shaping up very nicely with more closed business now than we had at this stage last year. As you know, the selling seasons really comes to a head in the 4th quarter. But given the current strength of the pipeline, I feel very good about our prospects. Specifically, we have client commitments for approximately 2,000,000 new members between July 2016 January 1, 2017. With that, I'll turn the call over to Mark Hirschhorn, our Chief Financial Officer. Mark? Thank you, Jason. On the call today, I'll review our Q2 financial results in greater detail and then I'll provide an update on our outlook for the remainder of this year. Revenue in the quarter was $26,500,000 that's an increase of 45% year over year. Subscription access fees accounted for $21,500,000 or 81% of total revenue. The 42% year over year increase in subscription access fees was driven by a 34% increase in our membership base, which stood at 15,400,000 members as of June 30, 2016. It's important to note that 100% of this 2016 growth in membership and revenues was organic. We also experienced increases in our average PMPM fees from $0.45 in the Q2 of 2015 to $0.47 per member per month this quarter. Consistent with the discussion we had during Q1 review, we continue to see strengthening per member per month fees compared to last year. While this quarter's per member per month was equal to Q1, we believe our per member per month fees will grow to exceed $0.52 by the end of this year. One of the challenges in the 2nd quarter in our direct to consumer behavioral health business was to exceed our objective to demonstrate greater than 35% quarter over quarter revenue growth. The key component to retail customer acquisition is digital marketing and the required advertising spend in this channel became increasingly more expensive on properties like Facebook and Google. We've been working hard to generate greater yield from our targeted marketing campaigns. Additionally, we've been very busy on the product development front as we continue to create innovative ways to capture new members. Finally, we've developed new price plans in order to ensure we maintain our strong margin profile. It is important to remember that this channel will grow nearly 125% from the $5,000,000 in revenues we produced in 2015 to the projected $11,000,000 in revenues for 2016. Revenue from visit fees, which accounts for the remaining 19% of our total revenue increased 57% in the quarter to $5,000,000 up from $3,200,000 a year ago. As Jason mentioned, total visits in the quarter increased 59% to over 199,000 visits. For the first time as a public company, we've broken out our quarterly visits by those members that incur a fee and those that benefit from a visits included model. Paid visits as a percentage of total visits were 64% for both Q2 of 2016 and Q2 of 2015. Paid visits totaled approximately 127,000 visits. Of the total approximately 199,000 visits in Q2 2016 and approximately 79,000 visits in Q2 of 2015. This week, we exceeded 500,000 year to date completed telehealth visits. As a reminder, the business model of HealthEast You is weighted heavily towards the model of higher per member per month with little or no visit fees. The integration of those visits into our business has caused us to reforecast the mix of full cost visits and those visits that come from members with 0 visit fees. We now believe approximately 40% of our nearly 1,000,000 visits this year will come from visits included members. I want to emphasize that these agreements are equally or in some cases more profitable than a traditional Teladoc agreement. With the integration of Healthy Issue on July 1, we have begun directing all of these visits through our network, enabling us to reduce the direct cost of each visit by over 50%. Our gross margins were 74% in the quarter, in line with the Q2 of 2015. Gross margins increased sequentially from the Q1 70% to 74% in the 2nd quarter due to the revenue mix shift I described earlier. As a result of our improvement of Healthiest Used gross margins, we feel confident that consolidated gross margins will remain over 70% for the full 2016 year. G and A expense for the quarter of $11,600,000 is an increase of 11% year over year. This represents 44% of total revenue compared to 57% of total revenue last year. Consistent with what we have been addressing over the past several quarters, we believe we have built an infrastructure that now benefits from scale. We added over 300,000 members from Healthiest U on July 1, and following the combination of the two companies, we did not incur any incremental G and A costs. We believe that the growth in G and A costs will increase at a far lower percentage compared to revenue growth. In the press release we issued earlier today, we have provided reconciliation tables between GAAP and non GAAP measures. Our adjusted EBITDA for the quarter was a loss of $10,500,000 compared to a loss of $14,400,000 in the Q2 of 2015. As we communicated during the first half of the year, we expect to generate decreasing quarterly adjusted EBITDA losses quarter over quarter for the next 6 quarters until we hit adjusted EBITDA breakeven during the Q4 of 2017. Consistent with this, our 2nd quarter losses were reduced by $1,400,000 versus the Q1 of this year. And finally, our loss per share for the Q2 of 2016 was $0.38 compared to a loss of $7.20 per share for the same period last year. Our weighted average common shares outstanding were 38,700,000 shares in the Q2 of 2016 compared to just 2,400,000 shares in the Q2 of 2015 when we were a private company. With respect to the balance sheet, we ended the quarter with approximately $112,000,000 in cash and short term investments and $31,400,000 of debt principally from our bank lines. Pro form a for the new SVB facility that we closed in early July, the company has approximately $86,000,000 in cash and cash equivalents with an additional $25,000,000 of borrowing capacity and total outstanding debt of approximately $53,000,000 Now I would like to provide you with our initial outlook for the Q3 and our full year 2016 guidance. For the Q3 of 2016, we have good line of sight and we expect revenue between $32,000,000 $33,000,000 EBITDA in the range of a loss of $12,000,000 to $13,000,000 adjusted EBITDA loss between $9,000,000 $10,000,000 membership of approximately 16,500,000 to 17,000,000 members, total visits completed between 205,000,215,000 visits and a net loss per share based on 45,700,000 weighted average shares of between $0.35 $0.38 For the full year 2016, as a result of the behavioral revenue shortfall Jason and I discussed, in addition to over 500,000 lives that 2 prospects have pushed into 2017 and the cumulative effect that it will have on the remainder of the year, we are trimming our full year 2016 guidance and now expect our revenue to be in the range of $121,000,000 to $124,000,000 our EBITDA loss between $48,000,000 $50,000,000 adjusted EBITDA loss between $41,000,000 $43,000,000 our membership to total approximately 17,000,000 to 17,500,000 members, total 2016 visits between 915,000 945,000 visits and a net loss per share between 1.46 dollars 1.50 dollars based on 42,500,000 shares outstanding. With that, I'll turn the call over to Jason for a few closing remarks. Jason? Thanks, Mark. I'm very proud of our accomplishments in the Q2 as we continue to demonstrate greater utilization and deliver significant value for our customers. However, we hold ourselves to a very high standard and I'm disappointed that we didn't deliver on 100% of our objectives. With that said, I feel very good about our prospects for the remainder of this year and for 2017. With that, we'll open the line for questions. Operator? Jason, I just want to make sure that we noted the 2016 net loss per share is expected to be between a loss of $1.47 $1.50 per share. Thanks. Operator? The first question is from Ryan Daniels from William Blair. Yes, guys. Good afternoon and thanks for taking the question. Jason, maybe I'll start with one for you. In regards to the client lives that are being pushed into January 2017. I appreciate that's just a timing issue, not a client loss. But maybe you can give a little more color on why they decided to delay that? And then maybe if you've seen that level of client delays in the past? Yes. Thanks, Ryan. Unfortunately, I have more insight into what goes on inside health plans than I probably care to recall. The health plans are large and complex operations and they're constantly doing resource trade offs among various projects. And in both of these cases, the clients are enthusiastic about rolling out the product, but because of various competing priorities internally, it took them a little longer to operationalize their side of it. We're for us it's a 60 to 90 day process to bring a health plan up, But unfortunately we can't control the operations within the health plan. So we have seen this in the past. Unfortunately, it's the large health plans where this happens and those are the ones that have this kind of an impact. But we're full steam ahead with both of the clients for 2017 implementations. And unfortunately for us, they happened they sort of coincided and happened at the same time. Okay. That's fair. And again, I appreciate just timing. And then in regards to the behavioral market, can you just talk a little bit more about, in your view, what drove the uptick in marketing costs? Is that election related already with ads starting to come up? And then number 2, given the lower yield, are you just effectively projecting that lower yield continuing? Or do you have some work to do to meet your new revenue guidance as it relates to the behavioral side? Yes. So I'll take the advertising market and then I'll give you I'll turn it to Mark for the projections going forward. You've probably seen the very strong results that have been posted by Facebook and Google. Both of those channels significantly increased their ad pricing and that flowed through to us and impacted us directly. Now we've done what I would say is 3 things to address the issue. We're continually adapting our business given the environment. So one is we're continuing to diversify the marketing channels into other channels both for advertising as well as sort of contextual sign up opportunities for people who are likely to be in the process of something that would make them likely to need counseling. 2 is to do a lot of work on price optimization in order to optimize the revenue per member that we get. As we see an increasing advertising costs. We want to make sure that we're optimizing the revenue so that we get a higher revenue per member. And then the third one is a fair amount of product development so that we retain our members longer. So obviously in a subscription based model, the longer we retain a member as being active, the greater value they have to us. Mark, do you want to talk about the projections going forward? Yes. Ryan, what we did is we obviously we trimmed some of the figures coming from behavioral. The costs that we incur with Facebook and Google are based on a very dynamic auction based pricing for all of the current advertising. So we believe that pricing is going to remain high, especially as there's demand in the latter part of the year, as we approach the election. So that led to again some of the trimming of the numbers. Okay. And then one final one, a quick follow-up there. Where was the behavioral weakness? What revenue line did that show in? Is that in the access fee line because you're charging a fee for those services? So it's access. That's correct. Yes, subscription access. Okay. Thanks guys. I'll hop back in the queue. Thanks, Ryan. The next question is from Nina Deka from Piper Jaffray. Hey guys, thanks for taking the question. I was wondering if you could provide some insight on your growth strategy in the Provider segment. For example, is your platform evolving to allow for white labeling? And also, are members within the provider segment able to set up appointments with their own doctors? Or do you see a plan for that down the road? Yes. Thanks, Nina. We have a team specifically focused on product development just for the provider segment. They've been working very closely with some of our clients in sort of co product development. We're seeing today a lot of demand for platform as a service, where we sell them the technology platform. And then they buy from us a range of operational and physician network capabilities, all the way from them doing everything themselves to our full turnkey solution where we provide the network, the operations and the technology. We do enable specific matching of a physician and a patient. So we've had that capability in our platform for many years where we do what's called what we call the private network. Specifically in this case, we use the systems, providers and if we have attribution, we match the patient to the physician to their very own physician. And then of course we can roll to a coverage group or to the whole Teladoc network depending on the rules that we build into our queuing system. So we're seeing very strong demand in the provider segment. I'd say we've made a huge amount of progress there over the course of the last year, which is really when we stood up that dedicated unit. Okay, great. Thank you. The next question is from Mohan Naidu from Oppenheimer. All right. Thanks for taking my questions. Jason, maybe going back to the 2 large prospects delays, where they expect it to go live in mid year? Or can you give us a little bit more details on when they were supposed to go live and when you guys realized that it's going to be moved on to 2017? Yes. Both of them were scheduled to go live early Q3. And really we only learned about it over the course of the last few weeks as they as we started to get to the final stages of implementation and they pushed out into 2017. Okay. Mark, on the revenue guidance, can you help us understand how much of the cut came from these 2 client delays versus maybe the expectation of increasing visits coming from visit included members? Yes. The reduction for our revenue for the remainder of the year was principally from the behavioral health unit. And when I say principally, it's probably a seventy-thirty split. There is no reduction from revenue for the actual visits to be completed. That's coming in at the numbers we expected for the year, slightly higher actually. So the offset there, to close the gap was really a combination of some of these delayed and other subscription access fees that didn't come to fruition in the Q2. Okay. So this is about 70% from the DTC, the behavioral? Correct. Okay. Thank you very much. Thanks. The next question is from George Hill from Deutsche Bank. Hey, afternoon guys and thanks for taking the question. I'm going to ask these two questions. I think they've been touched on a little bit different ways. Mark, did you give what I would call the visit rate in the quarter or what percent of the visits were delivered under kind of that all you can't model and is that something you would share? Yes. We just started in this quarter and we're going to continue to illustrate that for the remainder of this year and going forward. The visits this year or in this quarter, 64% fell under the paid visits. The remaining 36% over the visits included model, Obviously, that percentage and the number of visits under the paid model will be increasing beginning the start of Q3 when we began consolidating Healthiest You. Got it. Okay. And then Mohan was kind of going down this question, but I was going to ask, is there anything unique about the members that are being pushed out to the start of the next year? Because if I did like a 6 month analysis on kind of number of members guided down by times average member per month times expected utilization, the math didn't seem to add up. But you said it's you said the mix isn't weighted more towards behavioral. So I think I asked that question and answered it myself. I guess the last thing I would leave I'd end with is, you gave a little bit of indication about selling season into 2017. Would you talk a little bit about pricing environment and do you consider the pricing environment generally stable heading into 2017? Yes, we think it's stable. And in fact, as we make a bigger push into the smaller end of the market with the Healthiest Hue acquisition, we actually think we have some pricing expansion opportunities in that end of the market. But generally speaking, I would say that it's stable. Okay. I'll hop back in the queue. Thanks guys. Thanks George. The next question is from Steve Halper from FBR. Yes. Hi. Just to clarify, the behavioral health revenues are included in the subscription access percentage? That's correct. Yes, that's correct, Steve. Okay. So, what of the 64% paid visits, what percentage of those are under the higher pricing, right? Because aren't you rolling in higher prices per visit? The $45 price increase? Yes. The greatest percentage in excess of 80% of the visits are still at 80% at $40 today. There is some legacy contracts from the acquired businesses that we picked up through AmeriDoc and Consultadoc, 1 or 2 specific clients, a large airline and a few other clients that still have legacy contracts that provide for $30 visit fees through the end of 2017. Those $30 tend to offset the $45 visit fees that we began collecting at the beginning of this year. Clearly, those will begin rolling off and the impact of the higher priced $45 visits as well as the specialty visits will bring our average realized revenue per visit above 40 very shortly. Great. Thank you. So on could you just go through the impact on the paid and non paid visits after considering the Healthiest U acquisition? Yes. Pro form a for that acquisition, there's going to be a greater percentage of visits included visits. Therefore, the current paid visits percentage is going to and expected to decrease as a result of those far higher per member per month subscription fees coming in, and those began on July 1. Okay. And you said something around 40%. Is 40% sort of the run rate of sort of non paid visits? It's that was the rate at the end of Q2. That rate is expected to climb. Okay. And we'll see most likely a 10% increase in visits coming into the visits included model. Thank you. The next question is from Charles Rhyee from Cowen and Company. Hey, thanks for taking the question. Jason, if I can go back a little bit on the direct to consumer advertising costs. When I and I might have missed it a little bit when you were answering an earlier question was. Without that advertising, you say it led to less revenue. Is the decision not to make that spend tied trying to hit our breakeven EBITDA targets or how necessary was that advertising for some of the missed revenue that we saw in the quarter? Yes. So, thanks for asking that. We're constantly balancing between growth and making good on our commitment to march to profitability. And so we always try to be good stewards of capital and make sure that the dollars that we're spending will yield positive results for us. And so we make those trade off decisions all the time. We don't have perfect information on the yield that will come from our advertising spend in any quarter. But we do try to be disciplined in our spend rather than chasing, so to speak. And so, this is just general advertising to consumers like in Facebook or Google, so that maybe someone in HR sees it or somebody who's running a small business might say, hey, this is something we should look at? Or is it or is this sort of targeted to people who okay, so this is just brand de novo prospects? Well, Charles, this is specifically the advertising we're talking about is advertising for our direct to consumer behavioral health business. So this is trying to convert consumers into paying customers of our direct to consumer behavioral product. Okay, thanks. That's helpful. And then if I'm looking at the implied per visit fees, it looks like it steps up based on the revenue per visit guidance. Am I looking at that correctly? And just is that just as we think about behavioral health still ramping up? You certainly have a combination of behavioral health visits coming in and you also have just a slight mix shift as a result of the busier cold and flu seasons. You're going to certainly have a few more paid visits coming in. So it's a combination of the 2 and that's what we'd expect through the rest of the quarter. Okay. So that's just more a function of seasonality than anything is what you're saying? Exactly. We said earlier that those I was just going to add Charles, we said earlier that we've got today 36% of those visits come from those capitated or visits included models. And then we suggest that at the end of the year that number would grow about 10% to 40% of total visits. Okay. That's all. And just one last clarification on the health plans that are moving out to 2017. Jason, you referred to them at one point as prospects, but it's right to think that these are signed clients and we're just waiting to onboard them? Yes. These are closed deals. We're just we had hoped to implement as I said early in the Q3, that's where the mutual agreement was. But we can't control the internal operations of these large health plans. And so they push out to 2017. I guess stepping back, I'm disappointed that that's going to impact our revenue for the year. But for the first half of the year, we still delivered 54% year over year revenue growth and the business is healthy across multiple dimensions. So the timing is unfortunate, but I don't think that that should provide a commentary on the health of the business. And one last question, with the closure of Healthiest You, what is the discussions like going back to your legacy Teladoc customers since the deal is closed and since you had that the call a few weeks back? What kind of dialogue have you already begun with those clients about adding on new services? Thanks and I'll stop there. Yes, sure. So we've started exposing our existing clients to the Healthiest You functionality. And we have a long list of clients who are asking for those capabilities. I think the breadth of technologies and consumer engagement tools that Health ESU has assembled really resonates with clients. And so we're sort of taking this approach of first order of business is to make sure that we have our whole team in the under a 1,000 markets selling the Healthiest You product. 2nd, looking to upsell that product to our existing customer base in the small end of the market. And third, to bring those capabilities to our larger enterprise clients. Okay, great. Thanks a lot. The next question is from Lisa Gill from JPMorgan. Thanks. It's actually Mike Munchkin for Lisa. I was wondering if we could go back to your commentary on the size of the DTC business. I think you said that the business was expected to go from $5,000,000 in 2015 to $11,000,000 this year. Do I have those numbers right? And is that $11,000,000 your updated forecast in light of the shortfall this quarter? And then I think you also talked about adjusting some of your pricing in the direct to consumer segment. Can you provide any color on that? And is there any early read on whether the new pricing is having any impact on demand? Yes, Mike. So this is Mark. The DTC business did in fact complete 2015 with $5,000,000 in revenue and we're now adjusting our expectations to $11,000,000 this year. That year to date, that business is just under $5,000,000 in revenue today. And we will again, we'll continue to see based on existing subscriptions, we'll continue to see that grow and we believe we're very confident that we'll reach that $11,000,000 mark. And then the impact of the pricing strategy changes? Yes. The impact of the pricing strategy as Jason had noted will both help retention and by bringing on those clients that we believe are going to be longer term subscribers. We have a mix today of anywhere between $140 $280 subscribers on a monthly basis, principally based on when they actually subscribe to the service. There are some subscribers that have been with us on a month to month basis for over 18 months now. And then others, of course, those who've joined most recently are paying a subscription access fee of $2.80 a month, on a monthly basis. Got it. Thanks for the comment. And maybe just one follow-up. So total visits and utilization rate continue to look strong. Can you talk about what the key drivers are there? Are you starting to see any impact from customers adjusting plan designs and co pay structures to incentivize patients to use telehealth versus other more expensive care settings? Certainly, we're seeing some of that, but I would say, to be honest, the biggest impact is our continuing evolution to more sophisticated consumer engagement strategies. This year we have used a lot more digital targeted communications, social media and other ways to specifically target our members in order to have much greater frequency of messaging to them so that when they actually need the service, we're top of mind for them. That's a change and an upgrade since Stephanie Verstrait joined us as Chief Marketing Officer at the beginning of this year. And I think it's really bearing fruit for us. And you see that we saw strong engagement utilization in the Q1 and we see that trend continue in the Q2 in spite of the seasonally low quarter. Thanks for the comments. Thanks, Mike. There are no further questions at this time. This concludes today's conference call. You may now disconnect.