Astrana Health Inc. · NASDAQ:ASTH
Astrana Health — Apollo Medical Holdings — Investor Presentation (June 2023)
42 slides from Astrana Health's investor presentation, Jun 7, 2023
Slide 1: Apollo Medical Holdings June 2023
Apollo Medical Holdings June 2023 Powered by Technology. Built by Doctors. For Patients.
Slide 2: Forward-looking statements
This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act and Section 21E of the Exchange Act. Forward-looking statements include any statements about the Company's business, financial condition
Slide 3: ApolloMed At-A-Glance
3 ApolloMed is a technology-powered, value-based care healthcare platform that enables the delivery of high-quality, coordinated, and accessible care for all through its segments: Care Delivery provides high quality and accessible health care services through a patient-centric care delivery organiza
Slide 4: Accelerating high quality, accessible, value-based care across all patient populations
(1) Medicare Advantage, Managed Medicaid, Commercial, ACA Exchange, and Medicare FFS (2) ApolloMed 2019 to 2023E revenue and adj. EBITDA growth, using midpoint of 2023 guidance for both metrics. Please refer to the “2022 Guidance Reconciliation of Net Income to EBITDA and Adjusted EBITDA” and “Use o
Slide 5: We have laid a solid foundation for rapid growth
64% 20% 12% 4% Medicare Medicaid Commercial Other third parties Longstanding Relationships with National and Local Payers + Many more payers 2019 2020 2021 2022 2023 Revenue 1 Average tenure: ~15 years 89% 4% 2.9% 3.6% 0.5% Capitation Risk pool settlements & incentives Management fee income Fee-for-
Slide 6: Payer agnostic platform captures outsized TAM
Payer agnostic platform captures outsized TAM and delivers better experience for patients, providers, and payers Source: CMS and HCP-LAN (2021) 6 Better for patients Enhanced patient experience and care continuity across payer, plan, and stage of life Better for providers Can be empowered across the
Slide 7: VBC infrastructure and tech stack drives replicable and scalable results
VBC infrastructure and tech stack drives highly replicable and scalable results across all patients, allowing providers to grow and succeed across value-based arrangements • 1.3M patients managed in value-based contracts • We serve Medicare Fee-for-Service (Original Medicare), Medicare Advantage (MA
Slide 8: Providers face complex administrative and care coordination hurdles
Providers currently face complex administrative and care coordination hurdles Reporting Contracting Claims Data Aggregation Coding Billing Hospitals Clinics Referrals Authorization IT Credentials Clearinghouse Quality Providers PR Labs Many MorePayers Diagnostics ? 8
Slide 9: ApolloMed acts as a single payer
ApolloMed acts as a “single payer,” connects health ecosystem participants, and integrates clinical, tech, and administrative support for providers 9 ApolloMed is paid to assume risk for the care of our patients 1 We reimburse providers in a subscription model and share savings, aligning incentives
Slide 10: ApolloMed segments enable our mission
Care Partners ACO Network Independent Physician Associations and Networks Restricted Knox Keene License 10 Ancillary Specialists Primary Care Providers Care Delivery Care Delivery provides high quality and accessible health care services through a patient -centric care delivery organization, includi
Slide 11: The care enablement model wraps around providers' operations
Care Partners ACO Network Independent Physician Associations and Networks Restricted Knox Keene License 11 Ancillary Specialists Primary Care Providers Care Delivery Patient Care Enablement Contracting & Credentialing Revenue Cycle Authorization Provider Relations UM1 & Care Management Clinical Prog
Slide 12: A physician-centric approach providing flexibility and scale
We are changing healthcare through a physician-centric approach that provides flexibility and scale for our providers Industry Status Quo ApolloMed Patients supported throughout care journey by our ecosystem and care teams Entrepreneurial physicians can remain independent and partner with ApolloMed
Slide 13: Platform powered by proprietary technology suite
Our platform is powered by our proprietary technology suite, connecting patients, providers, and payers Provider Point of Care Application EHR1 Data Patient Care Management ApolloMed Care Team CM/DM, PAC, SDoH, etc. 3 Communications Patient Management / RPM / Real-Time Clinical AI Care Mgmt / Workfl
Slide 14: ApolloMed creates a flywheel
ApolloMed creates a flywheel powered by deep experience, an extensive provider network, and proprietary technology Providers will succeed in value-based arrangements with ApolloMed Personalized & effective care will engage patients and lower the total cost of care Improved care pathways and predicti
Slide 15: Growing in 30+ markets
ApolloMed is growing in 30+ markets in 8 counties across 3 states 15 Served by ApolloMed’s Care Partners (IPAs, ACO), Care Delivery, and Care Enablement Served by ApolloMed’s Care Partners (ACO) New CA San Francisco San Mateo Nevada Clark Texas Tarrant Harris Core CA Los Angeles San Bernardino River
Slide 16: Two clear levers combine to drive rapid growth
Two clear levers combine to drive rapid growth Data as of Q3 2022; (1) Note that in CA markets we have capability to more quickly accelerate new patients along risk ladder, and start patients beyond PCP Cap Only; (2) Increasing risk in value-based contracts corresponds to larger opportunity size in
Slide 17: Multi-faceted growth strategy across our markets
Multi-faceted growth strategy across our markets Where we are today Growth strategy Recent developments Core CA New CA Ex-CA ✓ 7 counties across core CA geographies ✓ Extensive and long-standing provider network ✓ 80% member growth since acquisition ✓ Provider count increased by 110% ✓ 58% increase
Slide 18: Consistent clinical outcomes across diverse populations
Consistent clinical outcomes across diverse populations and demographics Medicare Advantage and ACO Clinical Outcomes Purpose-built technology platform enables best-in-class clinical outcomes to be delivered for all Americans Ethnicities Served5 48% 21% 12% 6% 13% (1) Figures based on analysis of Ja
Slide 19: Key takeaways
10%-17% adj. EBITDA margins over the last 4 years 2 Bed days 54% below benchmark; ER visits 61% below benchmark 3 1.3M members in VBC arrangements across Medicare, Medicaid, and Commercial 27% 4-year EBITDA CAGR with 15% EBITDA margins at scale Key takeaways Strongly positioned to create a future wh
Slide 20: Appendix
Appendix fy apollomed
Slide 21: Financial Data
Financial Data fy apollomed
Slide 22: Strong track record of revenue growth and EBITDA profile
561 687 774 1144 1300 - 1500 2019 2020 2021 2022 2023E We have a strong track record of revenue growth and a robust EBITDA profile ($ in millions) Revenue 26% CAGR ($ in millions) Adjusted EBITDA1 27% CAGR Source: Internal data; (1) Adjusted EBITDA is calculated as earnings before interest, taxes, d
Slide 23: ApolloMed is a scaled player with a proven and profitable model
ApolloMed is a scaled player with a proven and profitable model Business Model1 Affiliate-provider model Affiliate-provider model Affiliate-provider model Affiliate-provider Model Affiliate-provider model Members Served 1.3M 1.0M2 390.9k3 268k4 103.4k5 Serves All Patient Types1, 6 P P O O O Market C
Slide 24: Scaling three business segments
ApolloMed is working to scale its three business segments: Care Enablement, Care Partners, and Care Delivery 24 $ in 000s Care Enablement Care Partners Care Delivery Other Intersegment Elimination Corporate Costs Consolidated Total Total revenues $ 30,566 314,653 25,383 240 (33,598) - 337,244 Cost o
Slide 25: 2023 Guidance
2023 Guidance ($ in millions, except for per share information) Actual YE 2022 Results 2023 Guidance Range Total Revenue $1,144.2 $1,300.0 - $1,500.0 Net Income1 $50.5 $49.5 - $71.5 EBITDA1,2 $110.1 $89.5 - $129.5 Adjusted EBITDA2 $140.0 $120.0 - $160.0 EPS - Diluted $1.08 $0.95-$1.20 (1) Net income
Slide 26: 2023 Guidance Reconciliation of Net Income to EBITDA and Adjusted EBITDA
2023 Guidance Reconciliation of Net Income to EBITDA and Adjusted EBITDA ($ in millions) Low High Net income $ 49.5 $ 71.5 Interest expense 1.0 1.0 Provision for income taxes 23.0 38.0 Depreciation and amortization 16.0 19.0 EBITDA1 $ 89.5 $ 129.5 Loss (income) from equity method investments $ (0.8)
Slide 27: Reconciliation of Net Income to EBITDA and Adjusted EBITDA (Q1 2023)
Reconciliation of Net Income to EBITDA and Adjusted EBITDA (Q1 2023) ($ in millions) 2023 2022 Net income $ 14.3 $ 12.1 Interest expense 3.3 1.1 Interest income (3.0) (0.1) (Benefit from) provision for income taxes 5.1 6.2 Depreciation and amortization 4.3 4.4 EBITDA1 $ 24.0 $ 23.7 Income from equit
Slide 28: Summary of Selected Financial Results – Breaking Out Excluded Assets
Summary of Selected Financial Results – Breaking Out Excluded Assets 28 Three Months Ended March 31, 2023 Three Months Ended March 31, 2022 $ in millions ApolloMed Consolidated Excluded Assets ApolloMed Assets ApolloMed Consolidated Excluded Assets ApolloMed Assets Revenue Capitation, net $ 300.2 -
Slide 29: Summary Balance Sheet – Breaking Out Excluded Assets
Summary Balance Sheet – Breaking Out Excluded Assets 29 $ in millions ApolloMed Consolidated Excluded Assets ApolloMed Assets ApolloMed Consolidated Excluded Assets ApolloMed Assets Current assets Cash and cash equivalents $ 274.6 16.1 258.5 $ 288.0 30.2 257.8 Investments in marketable securities 4.
Slide 30: Summary Balance Sheet – Breaking Out Excluded Assets (continued)
Summary Balance Sheet – Breaking Out Excluded Assets (continued) 30 $ in millions ApolloMed Consolidated Excluded Assets ApolloMed Assets ApolloMed Consolidated Excluded Assets ApolloMed Assets Current liabilities Fiduciary payable, accounts payable and accrued liabilities $ 58.5 1.3 57.2 $ 57.7 2.8
Slide 31: Summary Statement of Cash Flows – Breaking Out Excluded Assets
Summary Statement of Cash Flows – Breaking Out Excluded Assets 31 $ in millions ApolloMed Consolidated Excluded Assets ApolloMed Assets ApolloMed Consolidated Excluded Assets ApolloMed Assets Cash flows from operating activities Net income $ 14.3 (1.8) 16.1 $ 12.1 (8.1) 20.2 Adjustments to reconcile
Slide 32: Summary Statement of Cash Flows (continued)
Summary Statement of Cash Flows – Breaking Out Excluded Assets (continued) 32 $ in millions ApolloMed Consolidated Excluded Assets ApolloMed Assets ApolloMed Consolidated Excluded Assets ApolloMed Assets Cash flows from investing activities Payments for business acquisition, net of cash acquired $ -
Slide 33: Path to Global Risk
Path to Global Risk fy apollomed
Slide 34: Managing outpatient and inpatient risk contracts captures more upside (1/2)
Our ability to succeed at managing care across our outpatient and inpatient risk contracts allows us to capture significantly more upside than our peers (1/2) Facility / Hospital Outpatient Total Premium Dollar ApolloMed EBITDA from VBC We have an integrated inpatient-outpatient system featuring hos
Slide 35: Managing outpatient and inpatient risk contracts captures more upside (2/2)
Facility / Hospital Outpatient Total Premium Dollar Health plan We reduce administrative costs using our MSO’s proprietary automation tools— this allows us to profitably scale, enhancing operating leverage 3 1 1 1 VBE Rev COGS OpEx VBE EBITDA 3 3 Mgmt. Income from Non-Consolidated IPAs Our ability t
Slide 36: Clear path to move contracts along the risk spectrum
We see a clear path to success as we continue to move our existing contracts along the risk spectrum and expect to do so in new markets as well FFS Professional Full Risk Global 36
Slide 37: Revenue generated by capitation from professional risk contracts
A significant part of our revenue today is generated by capitation from our professional risk contracts FFS Professional Full Risk Global 1 (1) Operating expenses excluding interest, tax, depreciation, and amortization 37
Slide 38: Additional revenue and upside from full risk contracts
We also receive additional revenue and upside from full risk contracts that we share with our facility partners FFS Professional Full Risk Global Facility / Hospital Outpatient ApolloMed EBITDA from VBC Health plan 1 1 1 Total Premium Dollar VBE Rev COGS OpEx VBE EBITDA Mgmt. Income from Non-Consoli
Slide 39: With an RKK, we can manage the whole risk capitation dollar
With an RKK, we will be able to manage the whole professional and facility risk capitation dollar and achieve more downstream synergies and upside FFS Professional Full Risk Global Total Premium Prof. + Facility Cap Medical Expense Overhead EBITDA from VBC VBE Rev COGS OpEx VBE EBITDA Plan Sub-cap P
Slide 40: Key acronyms
Key acronyms ◦ ACO: Accountable Care Organization ◦ ACO REACH: Accountable Care Organization Realizing Equity, Access, and Community Health ◦ AIPBP: All-Inclusive Population-Based Payments ◦ APC: Allied Physicians of California IPA ◦ CMMI: Centers for Medicare and Medicaid Innovation Center ◦ CMS: C
Slide 41: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures This presentation contains the non-GAAP financial measures EBITDA and Adjusted EBITDA, of which the most directly comparable financial measure presented in accordance with U.S. generally accepted accounting principles (“GAAP”) is net income. These measures are not
Slide 42: Investor relations contact
42 For inquiries, please contact: ApolloMed Investor Relations (626) 943 -6491 investors@apollomed.net Carolyne Sohn, The Equity Group (408) 538 -4577 csohn@equityny.com
Apollo Medical Holdings — Investor Presentation (June 2023) on 6ix