U.S. Physical Therapy, Inc. ($USPH)

Good day and thank you for standing by. Welcome to the U.S. Physical Therapy First Quarter 2026 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I'd now like to turn the call over to Chris Reading, Chairman and CEO. Please go ahead, sir.

Welcome to our 2026 first quarter earnings call. With me on the line this morning include Jason Curtis, our Interim CFO, Senior Vice President, Finance and Accounting. I look forward to many of you getting to meet Jason for the first time around this earnings process and call, and subsequent investor calls and meetings. He's done just a tremendous job jumping in really without a lot of warning and keeping all the plates spinning in his normal job and doing a terrific job, both with reporting and the Board and all the many things, including the redo of our credit agreement, very instrumental in all that. So, I look forward to you guys getting to know him a little bit. Along with Jason, Eric Williams, our President and COO; Rick Binstein, our Executive Vice President and General Counsel; and Kate Venturina, our Vice President and Controller. Before we discuss the results for this past quarter, as usual, we need to cover a brief disclosure statement. So, Kate, if you would, please.

Thank you, Chris. Today's presentation includes forward-looking statements, which involve certain risks and uncertainties. These forward-looking statements are based on the company's current views and assumptions. The company's actual results may vary materially from those anticipated. Please see the company's filings with the Securities and Exchange Commission for more information. This presentation also includes certain non-GAAP measures as defined in Regulation G, and the related reconciliations can be found in the company's earnings release and the company's presentations on our website. Chris?

Thanks, Kate. So let me start off by covering some of the key objectives that we are neck deep in and working on and established as priorities prior to the start of the year. These objectives include semi virtualization of our front desk, which is and will produce savings in both labor as well as overall efficiency and improved authorization consistency, the latter of which ultimately has an impact on rate. AI-assisted ambient listening documentation technology, which will help our clinicians spend less head downtime on their computers. Obviously, that has an impact both potential impact on productivity and rate through unit capture, again, with direct patient interface. Reengagement with remote therapeutic monitoring for our traditional Medicare population after CMS revised the rules in late 2025, beginning 2026 this year in January. Expansion of our cash-based programs across a great number of our top partnerships. We initially rolled this out last year in the spring, another partner meeting in April this year with a large swath of our top 30, top 40 partners where a significant part of our growth in income comes from surrounding that were growth opportunities and one of those was cash-based program deployment. So that is rolling out as we speak. And finally, a strong investment and effort directionally to create opportunity with large hospitals and systems similar to the two that were previously announced, including NYU and another one in the Gulf Coast region. Those efforts are going very well. And in fact, we just started the NYU transition process for our initial set of clinics and we'll be rolling facilities in over the next few months across both opportunities. These initiatives are on track, and we believe will produce the results we have discussed as the year progresses. This, in combination with continuing ramp-up of visits across the company gives us the confidence to reaffirm our original guidance. In fact, we finished Q1 right on budget. And for some of you, I know you had a different Q1 expectation, but we were where we expected to be exiting this first quarter. First quarter highlights include revenue increase in physical therapy of 7.3% with a 2.5% same-store increase. This was driven from a 6.9% bump in patient volume, which for the quarter increased our visits per clinic per day to 31.8%. And I'll note just for some perspective that demand was strong this Q1. We lost over 31,000 visits to weather, which, as you know, impacts not just revenue, but the vast majority of our highest state people, we have to pay to sit at home during these events, which has a drag on margins. All of that is now in the rearview mirror as we ramp into the busiest period of the year. The net rate for the quarter rose to $106.49, up from $105.66 prior year. The biggest positive influencers there include a nice 3.4% year-over-year increase in our commercial rates, coupled with a small Medicare pricing increase that we are ramping into as the year begins. Pulling against that a little bit on a blended basis was a small drop in our Medicaid rate. We're going to have to watch that also as the year progresses. Injury prevention saw a number of good things for the quarter. Revenue increased 11.8%, which included a partial quarter contribution from our latest IIP New York-based acquisition earlier announced. Same-store revenue increased 8.2%, while margin increased 180 basis points compared to our Q1 2025 numbers. On the development front, in addition to the New York City-based IIP deal, we added in a Nine-Clinic therapy partnership in the Pacific Northwest. It's going to do very well for us. In addition, we opened seven de novo clinics in the quarter, we have more to come in both the hospital area as well as acquisitions. Recently, and we have already announced this, but I'll cover it, we completed the renegotiation of our five-year credit facility, which in addition to providing even better pricing and terms compared to what we had before, which was already a very favorable facility, but we were able to expand our capacity so that we can continue to invest in growth opportunities without compromise. Finally, in the quarter, as Jason will later discuss, related to the credit facility and our borrowings, we repurchased equity in two very strong partnerships with a total spend of a little more than $14 million, where we continue to have strong founding partners who are taking some chips off the table due to their extraordinary growth over time in one case and another at a point of planned retirement with a strong owner base still intact. Our strong capital structure allows us to be flexible and take advantage of these opportunities without compromising our ability to run the company or pursue a variety of growth opportunities. Part of the reason we feel confident in our ability to continue to grow through organic as well as acquisition-related partner-centric development is that we have a great balance sheet. As we've discussed, our improved and expanded credit facility gives us the dry powder to make good decisions about our growth and provides us with the resources and capital that we need to run the company, grow and expand where it makes sense in PT and industrial injury prevention and invest in new technologies, resources and people to make our growth plan happen, all of which we are doing in real time. This, along with our continued high demand for our services and our progress across key initiatives gives us the confidence to reaffirm our guidance for 2026. As I wrap up my prepared comments, as I always do, it's important to do because our clinicians, our partners, they're doing such a great job around the country every day to make a difference in the lives of our patients who they are positively impacting, make a difference in the lives of our injury prevention clients and their workers, keep them safe and healthy. And all of that helps us to attract the kinds of new opportunities, including our hospital partners like NYU and others, which will be an accelerant to our growth rate as we finish this year and look forward, especially into 2027. Jason, please go ahead and walk through the financials in a little bit more detail before we open it up for questions.

Thanks, Chris, and good morning, everyone. Turning to the details of the first quarter 2026 income statement. Total revenue was $198 million, a 7.9% increase versus 2025. Daily visits per clinic increased to 31.8 in the first quarter 2026 compared to 31.2 in Q1 2025. Total patient visits in the first quarter 2026 were 1,543,000, a 6.9% increase versus last year. Net patient revenue per visit was $106.49 in the first quarter of 2026, an $0.83 increase versus the prior year. This growth was driven by a 3.4% increase in commercial revenue per visit. This lift is made even more meaningful by the fact that commercial payers represent nearly 50% of our total payer mix. We also benefited from the early impact of our expected 1.75% Medicare rate increase. As a reminder, the majority of the benefit from the hospital initiatives will impact net revenue per visit and first quarter results do not yet include any impact from these affiliations. Total first quarter 2026 physical therapy revenue was $168 million, a 7.2% increase versus prior year first quarter. Mature clinic revenue increased 2.5% in Q1 2026, continuing the sequential quarter-over-quarter build from 2025. Adjusted physical therapy payroll cost per visit were $64.20 in the first quarter of 2026 compared to $63.53 in the first quarter of 2025. Adjusted physical therapy operating cost per visit were $90.31 in the first quarter of 2026 compared to $88.77 in the first quarter 2025. Adjusted physical therapy margin decreased to 16.1% in Q1 2026 compared to 16.8% in Q1 2025. IFP revenue was $31 million in Q1 2026, an 11.8% increase versus the prior year. Excluding the Q1 2026 IIP acquisition, IIP revenue increased 8.2%. IIP margin increased to 20.4% in Q1 2026 compared with 18.6% in Q1 2025. Adjusted corporate expense as a rate to revenue was 8.8% in Q1 2026 compared to 8.5% in Q1 2025. We continue to make progress on our Workday ERP implementation and expect to go live at the beginning of 2027. We are implementing Workday in both human resources and finance and are looking forward to modernizing our systems, increasing efficiency and improving the user experience. Interest expense was $2.8 million in the first quarter of 2026 compared to $2.3 million in Q1 2025. The increase was driven by cash usage associated with the two first quarter acquisitions as well as $14 million in purchases of non-controlling interest, as Chris mentioned. Income tax in Q1 2026 was 32.3% compared to 28.1% in Q1 2025. The Q1 2026 tax rate is elevated due to the negative impact of discrete tax items on comparatively lower pretax income. Adjusted EBITDA in Q1 2026 was $20.2 million, a $0.7 million increase compared to Q1 2025. Operating results per share was $0.46 in the first quarter of 2026 compared to $0.48 in the first quarter of 2025. Net income attributable to USPH shareholders was $5 million in Q1 2026 compared to $9.9 million for Q1 2025. Included in pretax income for Q1 2026 was a loss on change in fair value of contingent earn-out considerations of $2 million versus a gain of $4.8 million in Q1 2025. The Q1 2026 loss was driven by stronger performance in recent acquisitions, which increases our earn-out liability. GAAP loss per share was $0.12 in the first quarter 2026 compared to earnings per share of $0.80 in the first quarter of 2025. Earnings per share in Q1 2026 was negatively impacted by revaluation of redeemable non-controlling interest compared to a benefit in Q1 2025. Under GAAP, increases or decreases in the value of redeemable non-controlling interest are not included in net income but are included in the calculation of per share metrics. Stronger performance in Q1 2026 increased the value of these ownership interest, negatively impacting per share metrics. As Chris mentioned, we completed two significant acquisitions in the first quarter. At the beginning of January, we acquired a 50% interest in an Eight-Clinic Physical Therapy practice with $8 million in revenue and 66,000 visits. At the end of January, we acquired a 70% interest in an industrial injury prevention business with $7 million in business. Turning to the balance sheet. Cash and cash equivalents at the end of Q1 2026 were $28 million compared to $36 million at the end of 2025. Borrowings on our credit facility were $204 million in Q1 2026 compared to $162 million at the end of 2025. As noted, the increase in borrowings was driven by our two first quarter acquisitions as well as the $14 million in purchases of non-controlling interest. On April 15, 2026, we announced a five-year $450 million credit facility with a maturity date of April 14, 2031. Based on strong lender support, the facility was upsized from its initial $400 million launch amount, and we achieved improved pricing compared to our previous facility. Our lender group consists of Bank of America, Regions, JPMorgan Chase, Citizens, U.S. Bank and BankUnited. This larger facility compared to our previous $325 million facility provides us with additional flexibility as we need to grow our portfolio of partnerships and return capital to shareholders. The June 2027 maturity date for our existing interest rate swap remains unchanged. Our first quarter results were in line with our expectations, and we expect the impact of the 2026 objectives which Chris discussed to ramp up throughout the course of the year. As such, we are reaffirming our full year 2026 adjusted EBITDA guidance of $102 million to $106 million. With that, I will turn the call back to Chris.

Thanks, Jason. Great job. Operator let's go ahead -- I know we'll have questions. So let's go ahead and open up the line.

[Operator Instructions] And we can take our first question from Joanna Gajuk with Bank of America.

So, first, I guess, on Q1, the guidance, Chris, but -- so you said the weather was $3 million to $4 million revenues, right, and you cut your cost. So, kind of how should we think about the EBITDA headwind? And importantly, was this quarter sort of as you had included in your guidance? Because I think when you gave the guidance, kind of knew about the January weather situation. So, kind of explain to us how this quarter came versus your original expectations? And how should we think about what was the actual headwind to cost to EBITDA really.

So first of all, importantly, the quarter came in almost exactly where we had budgeted the quarter to be. Now there were a couple of puts and takes. But at the end of the day, from an earnings perspective, we came in right where we expected to be. We lost about 31,000 visits, some of those coming in some of our high net rate markets like New York, which also, by the way, impacted our injury prevention acquisition right out of the gate a little bit with weather and mobile units there. And so, when we look at that blended average rate, it's somewhere north of $3 million, $3.3 million if you use our average rate. And understanding that we've got to pay most of our folks, maybe not everybody, every dollar with some of our hourly people, although occasionally, we do that as well, depending on circumstances. But our salary people get paid regardless. So, demand was high for the first quarter. It was a tough weather quarter, but that's behind us. Demand has continued to build, meaning volumes have built, and we're not going to have weather anymore. And so, coming out of it in combination, we made some investments and continue to make some investments in some of these initiatives. Those investments include both people and other investments in products and other things. That's in the cost numbers as well, but we feel confident those are going to bear the fruit that we expect them to bear and that we've begun to see already as things ramp up. So, I don't know if that answers your question, Joanna.

That's helpful. Right. So, you did kind of assume this was a headwind in your guidance originally that you gave us and the quarter was sort of in line. So yes, you want to comment on that. Okay. Good. And then from here, right, how should we think about the ramp of the rest of the year? I mean it sounds like, yes, you guys are kind of up a couple of things, but I don't know if there's some numbers to put around because when you do that the rough math, so Q1 EBITDA was about, call it, 19% of the full year guidance. But the last couple of years, it was more like 20% or above 20%. So, I guess it was lower than typical. And then if you would kind of assume typical seasonality, which obviously things get skewed because there's different level of acquisitions and things like that. But if we do some rough math, we can get to like maybe less than $100 million for the year. Then obviously, you have like the hospital alliances. So, if you also could maybe quantify how much actually like in this year because you do talk about $7 million, but that's obviously when you like fully annualize it and fully ramped up. So, I don't know if there's something like in this guidance included for this. And lastly, there are also these acquisitions. I want to make sure like they were already in guidance and how much, if anything, they add also the rest of the year? Because essentially, what I'm trying to bridge is from Q1, how are you going to get to your $102 million to $106 million for the year because I'm getting more like a couple of million dollars short, I'm thinking maybe that's the hospitals and acquisitions that help explain the delta.

Yes. A couple of things. So, to try to tease that apart. So, the acquisitions, I believe, which closed in January and the end of February were included in our guidance numbers. We gave our guidance, I don't remember exactly, first week of March, end of February, first week of March. And so those were included in the guidance numbers. We have more activity to come, the activity to come certainly not been included. And in terms of the hospital ramp-up, Jason, I don't know if you have that at your fingertips, but we're estimating we gave the $7 million 2027 number on the full year basis, we had to estimate when these would begin to phase in. And so just literally last week, we began to phase in our very first Metro facilities into the NYU deal. And things are going well, but we've got a lot more to do. On the Gulf Coast opportunity, the other hospital opportunity, that depending upon how things go over the next couple of weeks, could begin in June or could begin in July. And so, there's several million dollars worth of additional hospital contribution. But obviously, we're not getting a full year. We're getting a half year at most or part year, not even really fully a half year because we've got to layer in these facilities, and that will take a few months, particularly in Metro's case. But all that was fully baked into our guidance when we did it originally. I can't give you a whole lot more granularity by quarter just because we don't do it. I mean we have those numbers, but we haven't guided by quarter in a long time. And I understand we're a little out of sync with you guys this first quarter, but that's where we are. Jason, do you have the -- if you don't, that's fine. We can follow up. The estimated contribution on the hospital contracts this year? I know we announced it on the last call.

Yes. So we talked about there being a portion of the annualized $7 million impact. And the way I would think about it, Joanna, is we are in the process right now in the second quarter of implementing these clinics, converting these clinics to the hospital affiliations. We expect to be materially complete by the end of the third quarter. So in the fourth quarter, you'll begin to see something like the full impact of the fourth quarter impact of the $7 million. So the benefit of the hospital initiatives will ramp up sequentially quarter-over-quarter as we proceed throughout 2026.

And we will move next to Jack Slevin with USPH.

Jack from Jefferies here. Maybe one, just to needle a little bit tightly on the numbers. The rent supplies and other line ran a little bit hot to what we were expecting. I guess, as did the corporate expenses. Just a little curious. I know you talked about some of the things you're doing to modernize the business. But on those two lines, anything to call out in terms of what's driving some of the year-over-year growth in those expense lines?

Yes. Q1, again, we had a little bit worse weather impacts, a little bit lighter revenue than we expected, although in the balance, came out at the end of the day where we thought. But we did have in a few partnerships a little bit more contract labor than we expected to deal with the volume that we had in those particular partnerships. And so that was part of the expense car. Jason, I don't know if you have anything else that you want to add.

I would just say that we are making some upfront investments in our 2026 initiatives that are going to pay off as we ramp up the benefit throughout the balance of the year as well as the weather impact that Chris mentioned would have a greater impact in terms of deleveraging on the fixed costs, some of the stuff you were mentioning, Jack, that will not continue as the -- we enter into the summer -- spring and summer season, and we don't have these weather headwinds against us.

Got it. Yes, I totally appreciate that. That makes a ton of sense. And maybe one more to follow up, Chris. I think the messaging sounded very positive on your confidence in potentially more hospital partnerships and on the M&A front rolling through the year. Is there any way to think about the cadence of that? Or can you just give a little bit more color on sort of what's driving the level of confidence in those two things to be able to keep adding via those two avenues?

Yes. Look, the cadence for you guys, and I'm sure for some it's frustrating, is not going to be something that's absolutely predictable because good opportunities sometimes take a little time to bring them fully together. But I do feel confident given the number and the depth and the range of conversations that we're having -- that we're going to have more things done on the hospital side. And while we don't get fully granular on what we have from an acquisition perspective, you'll see us continue to be active there as well. And as we have in the past. So no real deviation there. But these hospital opportunities, they're chunky and they make a really nice difference. And so it do take a little while to put together. We're dealing with big academic, in some cases, medical center institutions with a lot of constituents and big legal teams, and they do their appropriate work and it takes a little time. But as we continue to add more of these, as you will see, I think you'll understand the impact as we go forward. It's a nice impact.

And we will move next to Larry Solow with CJS Securities.

Just following up on that question on the hospital alliances, and I realize the cadence and timing is impossible to predict and especially the share. But ultimately, I think if you do the math, it's like 10% today if you do with these two initial alliances. What's the potential? How many total clinics do you think that could be using rough numbers over a three- to five-year period that you think you could potentially line up with big hospital organizations? And also the second question on that one is just on the volume growth that you can potentially drive as you join up with these hospitals? Because I know your EBITDA assumptions are based on just current volumes, right? But that's -- so if you could just give us a little bit more color on potential volume growth as you line up with these hospital partners.

Yes. So it's a little bit of a tricky question, and I have to be a little bit careful. And for one reason that I don't know for sure. But if you took what we've done just in the last year and you say, "Okay, with these two, that represents X," and you mentioned 10%. So Metro was 550,000 or 600,000 visits in a year, probably be significantly more than that when we get to the end of this year, it will be the other group of clinics with, I think, a 10 clinic group, smaller number of clinics. But if you blend those two together, and if you could do that level every year over three years or five years, it's a pretty good increase. And so, we're looking to do these where we can where it makes sense, where we can generate interest. And so far, interest has been strong. And so, I think it will get to be a decent chunk of what we do in the foreseeable future for sure. I know that doesn't help you do the model, although we sent your model around a couple of weeks ago, which I thought was, again, hypothetical, but pretty realistic overview. And so I think you have a pretty good handle.

Okay. Good. I appreciate the confidence. Just second question, just on the -- I know the quarter was relatively in line. It sounds like right in line with your expectations. You don't guide for the quarter. I think the Street clearly probably led by me kind of underestimated the impact of weather. But just curious, the pricing also, I know you've kind of discussed that the price per patient -- revenue per patient was up less than 1% and commercial was really strong. Medicare, it sounds like you got a little bit not the full benefit. But I guess the Medicaid piece, which is a much smaller piece, right, I think 5% of business. Is that a drag? Are you worried about that continuing for the year? And could that -- pricing outlook.

Yes. So again, for the first quarter, you blend -- it's like a vegetable soup, you blend it all together and you get what you expected, but the proportionality in some cases, was a little bit slightly different than we thought. And one of those areas was rate was a little bit less than we expected. Medicare was not the full benefit of the 1.7% as we look back, I think understandably, number one, our Medicare patients don't pay as quickly as the first of the year because they're trying to sort out their deductibles and there's just kind of a delay. So, the way we do our contractual adjustments has to do, in some cases, with our payment and payment timing. So, in Q1, you're straddling there you gave in December, which comes in the form of payment in January. It takes time to upload the new fee schedule. So, there's a lag and a delay and things get pushed out. So, we have a data point that we expect to continue to increase to around that 1.75% number as the year progresses, and we saw that last year. And then around Medicaid, I think Medicaid was down a few percent. It was a single-digit number. Again, not a big part of our business. One data point, we'll have to watch it. So we'll have to watch in Q2 to see if it was -- we'll have to do a little bit more work on it to see if it was a regional mix, which changed, which kind of skewed the blended number or whether there's some pricing differences in there as a result of states, which have made some changes. So, I wish I could tell you exactly at this point. We'll do more work on that as we have more color, we'll get with you guys and try to give you an update. But it's not going to be a big driver, particularly as Medicare is fully in there and commercial is strong. more comp, frankly, continues to be strong overall in general. And so may move a little bit, but I don't think it will swing.

Right. And I know price moved around a little bit. And I imagine Q1 the resets on deductibles and seasonality already low. I imagine that kind of could skew this one way or the other, too.

I mean if you look at last year, we had some pricing build through the year. We budgeted a pricing build through this year. We expect that we'll see that. Again, it's tough when you have just one data point, but we fully expect we'll get to where we thought we would be.

We will now move to Benjamin Rossi with JPMorgan.

I'm thinking about PT operating costs on a cost per visit basis were just north of, call it, like $90 a visit during 1Q. As we're thinking about this back half ramp, how should we be thinking about the run rate for operating cost per visit into 2Q and into the back half as you have your volumes been really normalizing and then some of your technology and hospital initiatives are scaling in there as well?

Yes. I think to what probably you guys expected it to be in a more normal rate and basis, a little bit high degree for Q1 we won't have any of the weather that we experienced in Q2. Visits have picked up even comparatively beyond that. And so, I think that will normalize. One of the things that we've worked really hard on the operations team, Eric Williams worked really hard on with our recruiting group is number one, the recruiting side of the business, but we've really focused on the retention side. And I'll tell you that for the first quarter, and the numbers have come down, down being in a good direction in terms of turnover. For the first quarter, those numbers are now sub 18%, which is as low as we've ever had since we've been measuring it in terms of turnover. And so we're doing a better job hanging on to our people. That will make a difference during the blow and go months when we're the busiest, which is currently Q2 right now is a great example. So I think those cost numbers will normalize. We have invested at the corporate office in some of these initiatives in terms of both people and resources, I'll call them. And so while there's a little bit of a displacement between when revenue begins and when resource allocation has to come in, in order to make those other good things happen downstream, those two will eventually catch up.

Okay. So some normalization and the turnover to impact the labor side. I suppose flipping over to the weather-related drag. You mentioned the 31,000 visits lost due to weather. Can you break that impact down by month? Did you see volumes rebound in March? And then do you have any commentary on how volumes trended to exit the quarter and have started in April so far as you enter this busier season?

Yes. I don't have a month-by-month breakdown, unfortunately, at my fingertips to be able to give you. But I will tell you that visits have rebounded nicely in April and in fact, even progressed within the month. And that has been really good to see. So I don't -- I apologize, but I don't have a month-by-month below-by-blow allocation on the lost visits.

[Operator Instructions] We'll go next to Constantine Davides with Citizens.

One more follow-up on the hospital and health system side. And I appreciate your commentary around those being chunky and hard to predict. But when you look at the pipeline, are there other NYU sized opportunities in there? Or is the Gulf Coast deal you alluded to perhaps more representative of the scale of the partnerships that you're exploring right now?

Let me answer it this way. So there are bigger opportunities in NYU. Part of the reason NYU in and of itself, when you look at that enterprise value of what that's going to do, it's a big opportunity. Is that the biggest opportunity that we'll have? I don't -- it won't be. Part of the reason that the impact to us is smaller even on the big NYU opportunity is we only own 50% of that business. In other parts of our company where we own 70%, 80%, even 90% of some of these partnerships, large partnerships, if you took just and dropped in, again, using NYU as an example, the NYU lift from an enterprise perspective and you apply that to a partnership where we had an 85% or 90% ownership interest, obviously, the impact to us is much more significant. But to answer the question broadly, there are markets where we think the opportunity is going to be even greater than the NYU deal and it will not necessarily follow a typical small lift like the Gulf Coast deal.

Great. And then in the beginning of the call, I think you've touched on this in the past, but I just wanted to flesh out the cash-based program initiative and a little more color on what programs have been deployed and the traction there.

Yes. I'm going to kick it, Eric, if you're able, you're front and center with this initiative, you and Graham. And so you want to go ahead and take that.

Yes, sure. And again, something we've really been pushing with all of our partners. It was the main focal point for the partner meeting that we held in April of 2025, and we just had 30 of our top 40 partnerships in Houston in April with a whole list of items that we covered, including the rollout of welcome ware and the AI documentation and the other centerpiece again was cash-based programs. The two that people are the most excited about and the one that definitely has the most traction are laser programs. You've probably seen lasers utilized in a variety of different settings. It's a cash-based service, not reimbursed by insurance companies. And we see a lot of patients coming in with the typical commercial insurance who have add-on services provided, laser shockwave probably being the biggest two and then dry needling is something we've been doing for a while, but we have a lot more partners being trained on that. So I would tell you that those are the three biggest ones that people are flashing out to right now. And we've got partners who've been enormously successful on it, running hundreds of thousands of dollars a year in cash-based services starting from zero. And as much as we talk about it, when our partners hear other partners talking about it and how they've been able to implement it and get their clinicians to buy in and get patients to have an interest really carries a lot of weight. And right after the partner meeting, we had a bunch of partners who really not launch cash-based programs, reach out and have an interest in finding out more about the lasers, where to get them and how to launch the program. So it's going to be something that we continue to push. We're certainly not the only ones in the industry that are pushing this. But I think we have a pretty good approach in terms of how we're going to expand it.

And let me just say this, and I think it's important to just get this out there and Eric believes in this as well. This isn't -- for you guys, you're interested in what are the economics and what's the possibility. For us, the reason to do this is because it works. It works for patients. It has great patient response, as Eric reflected. It has great patient demand. They see patients on the table next to them getting treatment and talking about the difference they made from the treatment before and they want to sign up. And so like anything else, sometimes it takes a while for insurance companies to kind of get the drift, they don't want to pay. There are technologies out there that are very, very clinically effective. That's why they're used. And secondarily, we're able to monetize that because it works, and that's the foundational element to all of it.

That's a great call. I mean the clinical efficacy behind all of these programs is well supported and documented. And that's the first thing that's presented to our partners around the opportunity to utilize these different types of services.

And there are no additional questions at this time. I'd like to turn the program back to Chris Reading for any other comments.

Okay. Listen, thanks, everybody. I know I've got follow-up meetings, Jason and I do with a number of you over the next several days, and we're happy to spend time on the phone. So let us know. We thank you for your time and attention today, and we hope you have a great rest of your week. Take care. Bye now.

Thank you. This brings us to the end of today's meeting. We appreciate your time and participation. You may now disconnect.