← 返回

2026.09.24 | TB | Healthcare | Upstream Rehab Pt.2: Labor & AI

原标题：Upstream Rehabilitation – Part 2 – Labour Market Positioning & AI Opportunities

#healthcare

Third Bridge · 2026-09-24

Analyst-led • 11 Sep 2026

Ben McAuley (BM) Founding Advisor at American Operator

Benjamin Parsons (BP) — Third Bridge Sector Analyst

Agenda

Key Insights

Introduction

BP [00:00:02]: Welcome to Third Bridge's Interview titled Upstream Rehabilitation – Part 2 – Labour Market Positioning & AI Opportunities. My name is Ben Parsons, and I'm fortunate to be joined today by Mr Ben McAuley, formerly a VP of Operations at Upstream.

Before we start today's Interview, please state either I agree or I disagree to the following statement: You understand the definition of material non-public information and agree not to disclose any such information, or any other information which is confidential, during this Interview.

BM [00:00:38]: Yes, I agree.

BP [00:00:40]: Could you begin with a brief background and your time at Upstream?

BM [00:00:47]: Yes. I started with Upstream back in 2003. It was actually Benchmark Rehabilitation at that time and worked there throughout my career in pretty much all the clinical roles within the organisation. Physical therapist, clinic director, area director, regional director, regional vice president and then vice president of operations for roughly the last, I guess, it was about 3.5 years. Oversaw roughly 200 outpatient physical therapy clinics. Spent time mainly in the Georgia market, and that's where my time with Upstream ended, but I also oversaw operations in the Chattanooga, Tennessee market, the Charleston, South Carolina market and the Dallas, Texas market during my time. Opened up roughly 75-100 de novos in my time with Upstream, directly opened 26 myself personally. Just a lot of experience with that organisation and with the industry in general.

Questions

[00:02:19] What's your sense of the labour market in the PT [physical therapY] space right now? How is that evolving? What is the current state of the shortage of qualified PTs?

BM [00:02:44]: Yes. There's definitely the growth of the labour market in the profession is not keeping up with the growth of patients that need the service. That's really been happening now for a few years, but as that margin continues to shrink and the supply and demand (audio cuts out 03.11). The cost of that labour is going up every year. The price that we're getting reimbursed for the services is either not changing or going down in some cases. That just puts a real constraint on the profession in general because most of the folks coming out of school are expecting more money and that continues to shift all the way up the chain with experienced PTs also expecting more money. One thing that's interesting is PTAs, which historically have not been a huge growth area in the PT industry have really, they're projected to be used and needed a lot more into the future. From some of the stuff I've read recently, the PTA market is growing quite a bit faster than the actual PT market, which for the right operator and strategy could be very beneficial because they do tend to be less compensated. There is a little bit of a hit on the reimbursement side, but there could be an opportunity there when used correctly to leverage the PT, PTA team or framework.

[00:04:56] On a previous call, I learned that Upstream pays roughly USD 10,000 below market rates, creating high churn of new hires and grads who essentially leave the business before they bill enough to break even. Where do you think Upstream sits vs market rates?

BM [00:05:20]: There was definitely a history of, I would say, their salaries being par, maybe a little bit below par with the rest of the market. As we started to notice that difference they would try to change the comp packages with other bonuses, whether it be a sign-on bonus, whether it be a retention bonus, whether it be sometimes student loan reimbursements, they try to essentially set up the package to, in total, be similar to what some of our competitors were offering. Towards the end of my time with Upstream, there was definitely an effort to increase that salary band to be more level with the playing field, but as we rose our pay, so did the competitors. We always seem like we were behind. A lot of that had to do with the rest of our PTs that were already existing within the organisation because there was definitely a whenever you made a salary correction, whether it be USD 5,000 or USD 10,000, you're not just talking about the person that's in front of you that you're hiring, that would have been an easy logical solution. You were talking about the other 200 therapists that are expecting to be compensated more that's already within your organisation.

There is definitely a pressure. All of those therapists know, for the most part, what other therapists are making. There was definitely a pressure to correct the rest of the therapists salaries as we rose that. That made it challenging to really make a substantial increase in the market as far as the salary bands go, but there was an attempt to do that, and it was trending positively, but I felt like we were always behind. Some of that, especially in my market, was because we were competing with the PT Solutions, which are reimbursed at a higher rate. They have a hospital contract. They're paid more per visit, and so they had more to work with, but there was definitely an attempt to try to at least get closer to the average.

BP [00:08:21]: Do you think it's a net positive for Upstream to sit roughly in line or slightly behind peers and then incur repeated recruitment expense vs investing in retention from a margin perspective?

BM [00:08:42]: No. In my opinion, I felt like we needed to be more aggressive as that curve began to shift, we needed to be more aggressive and pay people more and maybe not spend as much money on the recruitment side, but the structure of… The leadership of the operations, there was never that corrective grace period where you could do that without it drastically impacting your bottom line. There was definitely a pressure to somehow figure out how to pay people more, but it couldn't impact your margin. As you probably know, that's almost impossible to do.

[00:09:39] How much does it cost to recruit a new PT?

BM [00:09:47]: I don't know that we've ever really given a number for that. It would totally be a guess on my part. I'd say when you say recruit, do you mean just the recruiting department, or do you mean in bonuses, things like that that we would actually be paying them a sign-on bonus, that sort of thing?

BP [00:10:14]: What is the expense to bring someone on board from a G&A recruitment perspective? How much do you have to pay them in a sign-on?

BM [00:10:32]: I would say the recruiters, we probably had five recruiters in the Atlanta market alone. You can kind of back into a salary cost plus they're LinkedIn, things like that. I felt like we were wasting. I don't want to say wasting, but overspending on some of the platforms and doing less actual recruiting of people that would likely come over or be potential candidates. When you spend a lot of time on some of these platforms, they do get pricey. In a lot of cases, you're spinning your wheels on the same 30% of the PT population. A more direct approach probably would have been better in my opinion, but again, you got to spend the money to do the research and to get in front of those people. As far as a typical sign-on bonus, I'd say the average was probably in the USD 5,000 to up to USD 10,000 range, but for some of our really hard to fill spots, some of our most needed labour clinics, meaning the clinics where we had the most referrals coming in had the least amount of candidates.

In some cases, I'm talking about one or two candidates per year maybe. In those markets, we had to get a lot more aggressive and pay people more aggressive sign-ons, more student loan packages, things like that. In certain areas where we had the referrals, we had to definitely get more aggressive.

[00:12:41] I guess the reason you think management ought to focus more on retention, as opposed to eating the recruitment expense, is to preserve short-term margins, given the ramp in PT productivity the longer they stay out of clinic. What does that ramp look like in terms of revenue, EBITDA or billing? What’s the best way to conceptualise that over the first 3–5 years after a PT starts?

BM [00:13:16]: The turnover is a real expense. I would say as far as the productivity goes, it was interesting because we didn't necessarily see a correlation with retention and how many patients they were seeing per day. For instance, my market that I oversaw, we were by far the most productive, and we had the second highest retention within the BPO, which is six. There were six BPOs. There wasn't necessarily a direct correlation with how busy they are. As far as the ramp goes, it depends on who the hire was. For a new grad they ramp a lot slower. These are new clinicians right out of school. The expectation was for them to get up to 10 patients per day inside of three months. There was definitely an onboarding with them. Historically, that was too slow. In the early like 2022-23, the onboarding for them was a little bit slower, and they were given a lot more grace on how slow they could be, especially in certain parts of the country, meaning it might take them six months or in some cases, 7-8 months or in some cases, they never even got there at all. For the entire first year, they never got to 10 patients per day.

That was never really the case in Georgia because we were super busy and it just wasn't the way we were trained initially, meaning we expected our therapists to be seeing 12 patients per day by the end of the first year. 10 patients per day by the end of three months was very doable and very achievable. For an experienced therapist, I would expect them to be in the 10-12 visits per day range really inside of one month. They're given 30 days to learn the system and to get acclimated to our EMR system and our documentation system and just how we do things. Then within 30 days, they're expected to be at that 10 visits per day range and really soon thereafter, they're expected to be at that 11-12 visits per day. That's how my brain worked through that system, but that was not really the case for the entire organisation either.

[00:16:19] What does the yearly turnover rate look like for Upstream's PTs?

BM [00:16:31]: We lived right around that 20%. Maybe at times, I would say it seemed to peak in 2023-24, I noticed a bit of an uptick. Then it also became a real focus of leadership. That number came down, but it also varied quite a bit by market. In the Southeast, we lived right around 15-16%. In the Mississippi market, really all the way through Mississippi, Alabama, those markets, we were probably closer to 13%. In the Pacific Northwest and in the Northeast, those were probably 30% or more. Those markets struggled to keep staff. In the Pacific Northwest, there was a real push to drive productivity because they were so low. They were averaging in the nines, and there was a definite objective to get them over 10. Once that was rolled out or pushed, we definitely lost some folks because they didn't see eye to eye with the reasoning behind that, but a lot of the retention issues with the exception of that were more cultural, just not aligning with the leadership teams that were over those groups and some of the competitive pressure. We had some competition in certain markets that would come in with very influential leaders that would take all of our PTs.

[00:18:47] I've had some negative feedback on Upstream's overall labour market performance and physicians' retention rates. USPh reported an 18% as being a record-low turnover rate recently. Being at around 20% to me doesn't sound out of line.

BM [00:19:12]: Yes, I don't know what the most recent number you have. I would say it's come down over the last probably two or three years. I don't know how they performed this last year, but it was on a retracement down mainly because it was a focus, but yes, I would say compared to USPT, we were probably higher than them on a retention standpoint, meaning our number was worse. It definitely is market specific.

BP [00:19:54]: What could a strong performance for Upstream look like? What levers would they have to pull to get there? What should that figure be?

BM [00:20:08]: Like I said, the theory that if you ask therapists to work harder and see more patients directly is a negative impact on their retention is just a false narrative. Leaders that believe that it bleeds into their culture and how they work, how they do things. In my opinion, they could very easily attain both their productivity goals and retention goal of right around, I think they could definitely live somewhere between 15% and 20%, but they would have to pay people what the going rate is and they would have to earn the trust of the employees, mainly the clinical staff. They've lost the trust. When you lose the trust of your team, people either want to get paid more or they leave. When you have the trust of your team, you can pay them an average wage and they're very happy. In some cases, we had people that even were paid probably below market that were happy, but as soon as they feel like they can't trust the organisation or leadership, it's very difficult to pay average or below average wages. That's what happened.

Honestly, they made a lot of big decisions that impacted a lot of people and that kind of spreads. I do think it's possible. They have the bones and they have the clinical experts. They have great clinicians, but it's going to take a lot of work to regain the trust of the field. I'm not certain that the present leadership is capable of that, but somebody else definitely could do it.

[00:22:29] How have they sabotaged the culture and retention? Why isn't the current management capable of turning it around?

BM [00:22:44]: I would say, one, they haven't proven to be able to do any of it. Meaning they haven't turned it around thus far. Their track records, individually in their own territories, they haven't proven to be able to do either of those two key features, whether it be recruiting, retention or productivity driving. I can't think of any of them that have done that successfully over any length of time. As far as the trust factor goes, I think communication to the field and just being honest with the field on what the values and objectives are of the company, I think, is critical. People know when they're being misled or they're not doing things for the right reasons. There was a lot of short term decisions made to help the bottom line that created a mistrust in the field. A lot of it goes back to… They have a huge minority partner model. Meaning people that were partners with the company in these clinics that didn't feel like they were being as transparent as they needed to be with some of the decisions they were making. It's hitting their pocketbooks because their partnerships are not as good. There's some mistrust there. There's an opportunity there, but I think it would be hard for the current leadership to do that.

One thing about the PTAs, which is not the current leadership team's fault necessarily because they weren't there when this happened, but after COVID, there was a decision made to furlough all the PTAs within the organisation. While that helped in the short term because COVID was a really hard time, and there was a definite need to furlough quite a few people in order to keep the doors open. That blanket decision to furlough all the PTAs was a cultural hit because we had a good percentage of our therapists. I'd say, at the time, probably 20-30% of our therapists were PTAs. A lot of them didn't trust the organisation any more, and they didn't come back. Now I will say, since that time, there's been an effort to do some damage control around that and hire PTAs and get them involved. As I told you before, there's a huge opportunity with the PTA market because they're growing faster than PTs and they're cheaper. Upstream is improving with their… Because that was five years ago, they've made some efforts to improve that. I do think it's working, but it's slow. They're trying to regain the trust of a portion of the profession that some of the more experienced PTAs are like, no, you don't want to work for them. As soon as things get rough, they'll cut you loose. You don't want that with as big of a company as they are.

[00:26:57] Do you think that the restructuring they went through with the conversion of their second lien debt to payment in kind as opposed to cash interest unlocks an opportunity to meaningfully invest in staffing and stabilise the staffing side of the business?

BM [00:27:20]: I think it could. Yes, whether that's the focus or not, I wouldn't be able to tell you that, but I know that retention and competitive pay packages is talked about and it's a priority. Whatever plan they have in place now, are you talking about a restructuring that happened recently or in the future?

[00:27:58] The financial restructuring, which ought to alleviate a lot of the cash interest burden. Will management be aggressive enough in investing on the staffing side?

BM [00:28:14]: I would say they're probably more aggressive than they were. This is all just my opinion. I don't know for sure, but I still think there's probably not as much emphasis on that as there should be because there's still a lot of pressure on margins and other leadership goals that I think seem to always come before that goal, but whoever wins the labour race as far as the PTs and the PTAs go is definitely in the driver's seat as far as the profession goes and the growth and the potential that's out there because it's not going away. It would make sense to do that.

[00:29:29] What rate of labour inflation will Upstream be exposed to for 2026-27?

BM [00:29:38]: Do you mean how much more will they have to pay their people?

BP [00:29:44]: Indeed, yes.

BM [00:29:49]: 2026, I would think because they were already behind, they're probably looking at a needed maybe 6-7%, which I'm almost certain they're not doing, but yes, I think that's probably what would be needed to get themselves in at least a more competitive position. The reason why that's hard is, are you talking about new labour? Are you talking about their current labour force? It wouldn't be hard to hire new people at an increased rate, but then you got to go back and correct 2,000 plus other clinicians, 3,000 clinicians that are also expecting to be paid more.

I do know that there was a little bit of a change in the last year. I was there, they changed their performance incentives a little bit, which seem to be helping a little bit, meaning if you hit certain metrics, you earn more money per patient. It was very similar to the PT Solutions performance metric. The issue there is if PT Solutions has a similar bonus programme, if that's what you want to call it, then there's really not a huge advantage if that's who you're competing with, if they're paying USD 10,000 more in salary. At least that was my experience is the bonus incentive plan, while it was an upgrade and it was good, it didn't offset the difference that somebody could make with a competitor if they chose to look elsewhere. Then the only way you keep those people, if they know they can make more going across the street and working somewhere else, the only way you keep those people is if they really trust and respect the leadership team, which was definitely very geographical. In some cases, that doesn't even help, but it does at least give you a chance.

[00:32:38] S&P expect 19% margins for 2025 for Upstream, which seems strong relative to the PT peer group. How durable will that margin profile be going forward, given this need to invest in higher physician wages and the rate side?

BM [00:33:00]: It will be a challenge, but the history would show that it's definitely doable. The issue is how are they going to grow? How is Upstream going to grow their business? If the objective is just to continue to make 18-19%, I think that's probably achievable, but if they're expected to grow their EBITDA, that's where it becomes more challenging because their margins are not going to grow. Unless there's some structural change in how they're set up or an efficiency that they add via AI that could be beneficial. There's some opportunities there, but they would need to spend the money to get there. When you have that many clinics, it's proven to be a challenge to figure out where to go to continue growing. Setting up potential hospital relationships, I think, would be wise. They get a better rate. Then negotiating with payers is really where some of their leverage is in some of the states that they're not in that just don't value physical therapy probably as much as they need to, there could be some opportunities there on the negotiation side. At least in the Georgia market, they have so many clinics. When you add clinics, just to add clinics, you end up cannibalising yourself.

In some of their high demand areas, that's the game that they're playing is trying to figure out where they can grow, have referrals and have staff. That's the problem that they're trying to solve every day, but as far as maintaining their margin, I think it's achievable. What they need to do, I think there may need to be a sacrifice of a little bit of the margin so that they can get competitive with wages and then grow their overall platform of business and number of patients they're seeing, but maybe at a slightly reduced margin, and there would need to be some strategic efficiency planning, meaning, "Okay, how do we reduce the margin hit as much as possible, but still pay our people more and what the market wage is so that we can then have more of a ramp or more of a growth trajectory as far as new places, new geographies, things like that. There is an opportunity there, but it's going to be hard to not impact the margin, at least initially.

[00:37:02] Have you ever seen AI deployment lead to meaningful EBITDA uplift at a PT clinic on the ground?

BM [00:37:09]: No.

BP [00:37:11]: How much of a lever could that be going forwards?

BM [00:37:17]: Honestly, I think it could be one of the bigger solutions to what a lot of these companies are facing. I don't know if a lot is the right word, but there's more than enough opportunity in some of the leakage that happens with whether it be referrals leaking to competitors, whether it be payers, you're not getting the right benefits on the front end and you end up having to see the patient for free because of human error, whether you're not actually scheduling the right type of patient in the right block on your schedule, whether you're not collecting on the back end as efficiently as you should be, are you holding your payers accountable to paying what the bill should be paid. Following up with payers, getting customers and keeping customers engaged in their wellness and in healthcare, there's so many opportunities that could be driven by AI that it's very fragmented. There are companies. Even our EMR company used AI. Along the hiring of therapists and keeping therapists, there's a huge need for helping therapists or assisting therapists with their documentation, the company that figures that out through…

That could be AI, how to document what happened in a visit and take that burden off of the therapist, they instantly can see more patients. The amount of time that they spend documenting, especially with some of your federal payers and certain insurances require more documentation. If you had an AI assistant that was documenting what you did while you did it and that was removed from the therapist plate, not only are they going to be more satisfied and probably more likely to stay with your organisation for the same or less pay even, they're going to be a lot more efficient and a lot more productive. There's a huge opportunity there. I know there's companies that are looking and actively trying to do that. I haven't really heard of of any that have rolled it out successfully with a bigger organisation yet, but it's coming. That's one of the things I was talking about earlier on how do you hire and retain therapists for potentially slightly less pay is you make their life easier and you gain trust with them that their livelihood and it's not just a job, you care about their well-being.

You don't want them taking work home. You don't want them spending one hour to two hours every day outside of their normal treatment time documenting. That sort of stuff does matter to the therapists that I've talked to in the profession. If you can solve that problem, you make it a lot easier for yourself and probably a lot less pressure on the wage side.

[00:41:25] Do you agree that a PT might spend 4-5 hours per week on coding and therefore, that 10 incremental patients per PT per week would be plausible due to the deployment of ambient listening and other AI technologies?

BM [00:41:44]: When you say coding, I'm assuming you mean the full doctor-patient experience.

BP [00:41:52]: Exactly, yes.

BM [00:41:55]: Yes. I would say depending on the system they're using, that's probably likely. I would say that's probably average 4-5 hours. I know some that spend more than that, but they also are hyper productive. They see more patients, but yes. Then on the productivity side, that would come out to be about two more patients per day. Yes. I would say 1-2 patients per day would be very achievable.

BP [00:42:25]: How do you see Upstream positioned in that regard?

BM [00:42:29]: Even if you could just make the initial evaluation easier, that alone would be a huge win. Meaning the initial evaluation, which normally therapists see about one eval per day, that's the goal, 1-2 evals per day. Those typically take about 30 minutes. A very experienced therapist might be able to do it in 20 minutes, but 30 minutes on average just to document. Just minimising that down to a few minutes could be a big win for the therapist. A follow-up note typically takes 2-3 minutes. You're not getting quite as much bang, but there's definitely an opportunity there with documentation. Not only that, therapists get in habits of documenting and coding for efficiency's sake and for what makes things easy and flow quickly for their life and for their patients. A lot of times, you'll have therapists that code in certain ways. There's a pattern of coding that is just set up in their system, the way their EMR system is set up because it can be very customisable to how they do things, where they might be coding four units for a patient when optimally, they could be coding a cocktail of four different units for that same patient. This probably doesn't make a ton of sense to you, but there's really five or six main codes that are used in therapy.

When you use the same code over and over and over, there sometimes is a reduction from the payer vs when you do a cocktail of codes, you actually get paid more per visit. Having a system because we train our therapists in optimal coding, and we have experts that are great therapists, have the best outcomes. What is it that you're doing in a treatment session and what is the optimal way to code for that session. You'd be amazed at how different those are from clinic A to clinic B to clinic C, they all would code the same treatment differently. A lot of it is habit and ease. If you had an AI system that was, "Hey, you did this, this and this, this would be the ideal way for you to code for this patient to maximise reimbursement," you would have an immediate lift in your revenue per visit.

[00:45:35] Where do you think Upstream is on the curve when it comes to AI adoption tools vs the peer group?

BM [00:45:45]: No. I would say we're behind. Now I don't know because I haven't been there in over one year. They may have made some changes, but we weren't really utilising AI much at all when I was there. I did start to hear some competitors that were starting to use AI-assisted documentation, things like that. I don't know how it went or I know that we were looking. I know that Upstream was looking at certain AI-assisted platforms, but there was never any that were rolled out or actually made a difference. No, there's definitely an opportunity there. It would not surprise me if they're either looking at it or already starting to pilot. The key comes down to are you willing to pay the amount that it's going to cost to roll that out throughout the organisation, and you'll probably have an initial hit. Anytime you change EMR systems, if that's what it takes, and I might say Braintree has an AI division themselves. They are capable of implementing some of these things, but if you were to change EMR systems, you are going to take a hit. In your collection, everything goes down whenever you change those systems. I don't know that they're willing to take that risk yet, but I could be wrong. At some point, they're going to have to.

[00:47:38] What about the evolution of PTA [physical therapy assistant] models where a PT leads 2-3 PTAs and the implications that could have for solving the labour market shortage for Upstream and driving same-clinic EBITDA?

BM [00:47:58]: That's one of the theories that I've read out there in the PT space is because PTAs are growing faster than PTs, there is a potential there for that being an opportunity to do just that. The issue there is you still have to have the right cocktail or mix of PT, PTAs for each centre. That's doable, but it's a little bit more complicated, the smaller your clinics are. When you have a bunch of small boxes and in some cases, you might have two FTEs or three FTEs per clinic, there is some logistical challenges where you have to have at least one PT at every clinic and then a mix of PTAs, you need a ratio, if you will. Maybe two PTAs to every PT or three PTAs to every PT. There's been some improvement on the PTA side, hiring with Upstream, but there is an undertone of what occurred four or five years ago when they furloughed all the PTAs, people still remember that. There's a little bit of friction still in the market, but I would say it's improving. Over the next 5-10 years, I would think that will be… If they could continue to earn the trust of PTAs and prove that it's a good place to work, I don't think that will be an issue any more. They can regain that aspect of the market with good leadership.

There is a slight reduction in PTA reimbursement, though, with Medicare, you don't get paid as much per visit. Some payers pay less for PTA visits. Again, that's where AI could really help make sure that their cocktail of PT, PTAs for that individual clinic's payer mix is optimal for not only serving the community and treating the most patients possible, but also maximising the reimbursement and making sure that their margins are staying where they need to be and/or potentially growing. If you have 30% Medicare in a clinic, you got to be very cognisant of the fact that you have a certain number of PTAs, whereas if you have 5% Medicare in a clinic, you could have a lot more PTAs and it would probably work out great. Your margins will actually increase. There's a balancing act there that needs to happen on an operational level that would have to be managed and could be rather than having you could have AI assist with that, I guess, is probably the short answer.

[00:51:38] What is your view on the opportunity around hospital system JV partnerships? I've heard this is a way for PT players to double their EBITDA margins vs standalone clinics as you get guaranteed patient volumes and you can piggyback off hospital system rates. Is that a meaningful contributor for Upstream at present? Could it be?

BM [00:52:06]: There's some opportunities there. They have some of those. I don't think it's near as frequent as, say, a PT Solutions. That's what their model is a lot of their clinics are in that. They utilise that model. There's definitely an advantage on the hiring front because you can't afford to pay your therapists a little more. As far as how it works out on the back end, because I'm assuming you're also splitting the profits or you're paying at least a percentage of the profits to the hospital system. On the back end, I don't know whether it's a good business move or not. I have not been involved in those types of set-ups. I just have competed against them and know that they tend to have an advantage on the hiring front because they have more money to work with, but yes, the short answer would be, yes, I do think there's opportunity there. The hospital systems are only getting larger and more dominant, at least in the markets that I'm in. Setting up those partnerships could be beneficial. I'll give you an example in Georgia, for instance, there's really probably four big hospital groups. The issue with partnering with one of those hospital groups is you alienate the other three.

In some markets, playing more of a Switzerland role and taking patients from all four outweigh the partnership of one, if that makes sense. That would be a strategic decision that the operators would have to make. Now in new markets, I think that would be a really good idea as you enter bigger markets that you're not currently in, if you could go in with a partnership, you're going to have a much easier time ramping and taking market share than trying to do it on your own, but in some of the existing markets, they're set up that way for a reason. It's because they're getting referrals from all four of the hospital systems, not just one.

[00:54:57] What is your level of confidence in management? Do you think they're overly focused on short-term margins and cost cutting to drive meaningful EBITDA growth and deleveraging ahead of the 2029 and 2030 maturities approaching? What's your view on them turning the picture around?

BM [00:55:28]: I'm not super high on the leadership team in general, the senior leadership team. They have the bones in the organisation. They're going to have to commit to the things we talked about at a meaningful level to have any chance of hitting the targets that they need to hit, meaning they're going to have to improve their hiring and retention compensation. They're going to have to get more productive. They're going to have to drive productivity and especially in markets that are underperforming. Then they're going to have to leverage technology, and that's going to cost money. If they can do those three things, then they have a chance, but I guess if I was putting my money on it, I would not.

BP [00:56:34]: Thanks so much for coming back on again.

BM [00:56:41]: All right. Take it easy. Have a good weekend.

BP [00:56:45]: You too. Appreciate it. Bye for now.

Transcription ends at 00:56:50 of the recorded material