Veradigm Inc. (MDRX) Earnings Call Transcript & Summary

Good afternoon, everyone. My name is Michael Minchak, and I'm a member of the health care services equity research team here at JPMorgan. I'm filling in today for Anne Samuel, who covers the health care IT space for us and is currently out on maternity leave. So it's my pleasure to introduce Allscripts, and we'll have CEO, Paul Black, presenting today with Stephen Shulstein and Rick Poulton joining for the Q&A. Following the company's presentation, we will have a Q&A session. I do want to remind those who are joining about the ask a question feature. If you do have any questions, please feel free to click the blue button to submit them. So without any further ado, I'm going to turn it over to Paul to begin.

Thank you, Michael. Greetings, everybody. My name is Paul Black. I'm the CEO of Allscripts. Joining me today is Rick Poulton, our President and CFO; and Stephen Shulstein. Stephen is in charge of our Investor Relations in organization. If we can go to the next slide, please, Slide 2. Slide 2 has our information around our comments about forward-looking statements and our disclaimer there on to Slide 3. Slide 3 talks about the fact that we had a very important year in 2020. We're not going to talk about all the things that happened during the course of the year. Everybody is painfully aware of that from a worldwide pandemic standpoint. 2020 for a year was a very important year for Allscripts. It was a year for us to do a very major reset. We reset our client priorities. We reset our portfolio based on client priorities. We set our cost base, we reset our portfolio, and we reset our balance sheet and our capital structure. We did do so very quickly, in my opinion, and we did it in a way that will create a lot of ongoing value not only for our clients, but for our associates and for you, our shareholders on a very long-term basis as far as we are concerned. Slide 4, please. We reset our priorities around our clients to cope with COVID-19. There's a lot, as everybody knows, important setting, if you will, our client expectations on what health care information technology could do for them. Specifically, in my opinion, the role of electronic medical record was highlighted and punctuated as a result of the data that reside inside electronic medical records as being absolutely important to the management of the cohort patients that came in, in many cases, in an influx, and in many cases, through surges throughout the course of the year. It also created a substantial amount of data for people to make better decisions financially about what service lines were effective for them, what service lines needed to be improved. And other things that needed to be done to create cost efficiencies inside of these organizations. All U.S. organizations and all the organizations around the globe were impacted by this pandemic. And all of them, all they needed to have some sort of quick relief with regard to the data that we required in order to make better decisions. Care coordination was highlighted as a result of being able to make sure that patients that came in were moved out of the hospitals and moved into post-acute care facilities that could accommodate COVID patients. We specifically had a number of different applications that were changed and altered very quickly in a very agile environment in order to accommodate the new COVID patient type and the patient cohort in the special requirements that those patients had in a post-discharge summary capability. The ability for people to look through the network to find facilities that were capable of taking COVID patients as well as for people to be able to move patients inside of institutions where, historically, those beds may not have been available, but they were now because of the telemetry that was provided in many organizations as they built specific units just for COVID patients. From an interoperability standpoint, I felt very comfortable with where we were on our interoperability platforms. We have the most open API, series of platforms that are out there, both on the ambulatory as well as the EMR side, and we also support non Allscripts databases and EMRs in order for those data to be more effectively utilized throughout the rest of the organization. From a patient engagement standpoint, it could not be more important of a concept and a construct that happened during the course of 2020. And you'll hear me talk a little bit more about this later. But the ability for patients to contact their caregiver without having to go in and sit in a wait room, without having to go sit in an emergency room. In fact, if they weren't horribly sick, they were scared to go into hospitals, and they preferred not to go to a physician office where they might contract the virus from somebody else. So there's a very important new construct that will permanently change the way the patients engage with health systems and has -- that has to do with our FollowMyHealth patient platform that's also EMR agnostic. From an electronic health record standpoint, I talked about that a bit before, but some of the capabilities that we changed in order to be able to do quick registrations. Historically, we've actually made those now available to our clients in a way for them to be able to do quick registrations for COVID patients, which is, as you know, if any of you have driven through a COVID testing site, there's a different set of requirements for that type of interaction than there are for people that are actually getting registered as a result of coming into the emergency room. So those capabilities that we have for other components were retooled and made available for our inpatient as well as ambulatory patients or inpatient systems as well as our ambulatory solutions in order to be able to do quick registrations for things like COVID testing. And then Veradigm, our capabilities around data and data analytics were also extraordinarily important, not only for the research that were performed by the massive amount of work that went into creating new drugs and creating new vaccines in order to combat this. But also we made those data available to caregivers as well as to researchers around the globe to be able to more quickly and effectively come up with ideas and constructs around how they are going to come up with the new vaccine that they in fact did. I'm not claiming credit that Allscripts, Veradigm was the reason why, but the access to data and the capability to be able to present that data around a very large number of patients that sat inside of our database was extraordinarily valuable to researchers around the globe. Slide 5. We reset our cost base. We substantially moved the meter on what we did on our margin improvement over the course of the year. You'll also notice that our Q4 numbers that we are discussing today are a little bit better than what we highlighted -- that we highlighted in Q3, we are very proud of that. But a 730 bps improvement during the course of the year is pretty monumental. Again, we've made a lot of changes. We made them very quickly. We made them very efficiently, and we are seeing the continuous improvement of that work being manifest in Q4, and we're not finished. We see this as slow and steady progress, even though we went -- we were very quick to make decisions about what needed to be done. As we highlighted in the past, we brought an organization from the outside to help us with that through AlixPartners. We did a lot of the work with them and with our team in order to be able to make the decisions that we had to make in order to make these improvements that we are finding to be very systemic. They're important to us, and they will continue to increase over time. We also feel that this is a journey, meaning as a company, our ability to be able to do this on a predictable and regular basis will continue. We expect this to be something that's systemic inside of the company and part of the operating plans and procedures as we think about using data to help us more effectively manage the business based on all the inputs that we get on a regular basis from clients. From the straight -- from our cost structure and from where we need to be investing in the company. We also -- if we go to Slide 6, please. On a value unlocking basis. We had 2 exits during the course of the year, which you've all, I'm sure, read about, both the CarePort transaction as well as EPSi transaction. Both of those were part of the value unlock strategy that we had, and that had to do with these 2 assets in combination being less than 10% of the revenues of the company. But clearly, we're valued substantially higher by other people outside of Allscripts than they were by the Street at the time. When we think about these 2 assets being somewhere on a net -- on a gross basis, $1.7 billion, that was a very large amount of money that the team has now concluded as both of those transactions have closed, and both of those transactions are in the books for the 2020 standpoint. Very proud of that component of the portfolio valuation and also the portfolio reset that we had during the course of 2020. Slide 7, please. We also reset the balance sheet in our capital structure. We ended the year with net debt of 0, and we expect that, from an ongoing basis, to have a structure in the 1.5 turns of adjusted EBITDA from a debt standpoint. So we don't have the debt now. We consider that to be a high-class problem. But over time, you should expect that number to move up a bit, but it will not be something that's substantially or over the 1.5 bases. We think that's a good place to be given the current unpredictability in the market with the pandemic not being over with yet. But we think, again, that's the place that is a prudent area for us to be in order, again, to produce predictable and visible results. We also repurchased, as a result of the cash that came in from those 2 acquisitions -- those 2 divestitures over $280 million of stock in 2020. And we also expect, in 2021, to continue our stock repurchase programs, and we expect it to repurchase a significant amount of shares in 2021. Slide -- please move on to, if you don't mind, Slide #9. Looking forward, we feel that Allscripts continues to be very well positioned to help solve the health care problems that we see today. The investments that we made over the last 8 years in consumer and interoperability in our predictive medicine programs in our precision medicine programs are all important to where we think the future of the company is and why we still maintain a very relevant base and why we still have the breadth and depth to be able to compete in this marketplace and continue to provide our existing clients as well as attract new clients to the Allscripts family. We continue to have a lot of emphasis on interoperability that will, I think, in my experience here as well as in talking to clients, interoperability continues to be an extraordinarily important piece of the missing puzzle of coordinating care across communities. Not every community has 1 EMR. Most communities have multiple EMRs. And in our operability platform is going to continue to play an extraordinarily important role there. The focus on the consumer, I've not talked to any Chief Executive Officers of any health systems or of any ambulatory large group, multi practice clinics that are not very focused on attracting consumers to their brand, attracting consumers to their footprint prior to the consumer actually being a patient. So the digital front door, the words that are used in those regards are extraordinarily important to people, and it's very strategic to the executives that are running these organizations to make sure they understand how consumers are acquiring health care circa 2021 as that meter got moved during the COVID crisis and many, many people were much differently accessing health care through their phones, through apps and through other ways. Our approach to that is to have a single platform that allows patients to access health care, irrespective of the underlying EMR that they might have. We think that's an extraordinarily important component of what we do. Slide 10, please. Our vision remains the same, which is to build open connected communities of health. Our open platform, our open approach has been somewhat copied by many others over the course of the last 3 or 4 years. The open us in our APIs are actually not part of the legislative infrastructure that came down with the 21st Century Cures Act. The API mandate that came with that is something that we had advocated for to create interoperability between systems, but also to give access to consumers, to their medical records. These are all things that we think are important as part of our vision. It's been part of our vision for the last 8 plus years that we've been overseeing this wonderful series of assets, and we continue to think that, that is extraordinarily important as we think about the health of communities. And we think about the openness that we have created. And so we think about the investments that we've made in order to have a platform that is not only taking care of people that are sick. But also helping people make better decisions about how to keep people healthy. We are -- from a scale standpoint, we've said many times, and we'll continue to say that it's important to have a certain breadth and depth and a scale. The scale allows you to make investments in research and development. And scale allows you to be relevant in the marketplace. Scale gives you options in the event that there's other assets that might be available that are in the marketplace, it could be important as well as to make sure that we are continuing to fund the growth-oriented pieces of the business that we have. Our R&D spend is a manifestation of that scale and the R&D spend over the -- since 2016 has been over $1.5 billion spent on organic development of Allscripts solutions. That has also manifest in over 150 patents that have been submitted and granted during that period of time, and we have a lot more submissions that are out there. Patents are important from my standpoint because we think that is an indication of innovation. We also think it's important to protect the assets of the company and protect the spend that we made on research and development. Veradigm is also important from a standpoint that we are different in that we have a very important and robust piece of the business that is specifically focused on data, focused on analytics, focused on pharma and focused on the insurance companies. This is a different buyer market, and it's also a different usage of the data that's generated as a result of the electronic medical records that we have -- on the one hand, that feeds the information, that feeds the data, that feeds the logistics around consumption, around clinical quality, around clinical cohorts of patients as well as what medications have been effective. Those are all extraordinarily important to our pharma consumers as well as to the payer community, who are very interested in making sure that 2 of them have connectivity back to the last mile. In other words, if I have a piece of actionable data whether it's pharma or insurance, and I want to be able to connect to the consumer or I want to be able to connect to the physician, I can actually do that as compared to running a very large data set coming up with the analytics, and then having to go over the course of time and effort and energy, go work through that over a longer -- much longer elongated period of time in order to create the effective change that you're trying to create. As compared to being part of the ecosystem, part of the workflow and part of the network that they already exist in the marketplace. Insurance companies and pharma have found that to be an extraordinarily valuable last mile connection to both the consumer as well as to the health care system. I mentioned interoperability earlier. Our capabilities there are very vast. We are probably the largest interoperable platform that's in production today. Most of these interoperable platforms are not sitting on top of Allscripts, but also the other major competitors that are out there, the other major electronic medical record players. In some places, we don't have any Allscripts electronic medical records that are being interoperable across entire countries in the case of Israel, and we manage all of those connections, both the retail as well as to the pharmacies to be ambulatory clinics as well as to the hospitals throughout that entire country are all automated through an interoperable platform called dbMotion. In the states, our largest user of that would be University of Pittsburgh Medical center, where they have over 71 different electronic medical records that are connected through dbMotion. They use that each and every day. And people that use that system will make a different clinical decision 50% of the time that they click to the dbMotion web page or capability, and then to get the information around not only what they're seeing in that patient in that EMR that they're currently in. But the community information that's presented to them about other clinical events that have occurred to that patient that's sitting in front of them, and they'll make a different clinical decision as a result of that over 50% of the time. To me that's the real value in having interoperability at play. It's not just the data, but it's the way the data are presented in the workflow. And in the context of the practicing clinician that allows them to get the information around the totality of the patient and they make a better clinical decision as a result of having a community view of the data versus just one. Our open APIs, we've been talking about this for many, many years. In our open API, we've done over 4 billion API transactions over the last 24 months. That is a real-world number about how these systems all work and interoperate. And those to me, we're very proud of that because that shows the usage -- ability of other people, not only clients to use the data on their own, but also third parties to be able to use the data on their own to build on top of the Allscripts ecosystem. My clients have told me numerous times during the COVID crisis, their ability to get open access to the data that sat inside their EMRs, allow them to build applications if they did not exist and allow them to get insights to make -- to take better care more effectively more and quicker than they would have if they had not had the open access to the data that sat inside of their own EMRs. And the relevance, I think, on the -- that this all represents is a manifestation of many years of investment on R&D. To make the systems that we have today more robust, to add different functionality, to complete the platforms, but they also add some platforms that perhaps we didn't have in the past, to augment platforms that we invested in, in prior years, and that represents the breadth and the depth of who Allscripts is as we sit here in January of 2021. Page 11, please. We do talk about the segment, which represents our data and analytics business, which is Veradigm and in Veradigm, these are the main functions that part of the business performs. We have entire proprietary data sources that we utilize in order to make sure that we are able to analyze the data. We use that data not only for our own EMRs, but we also collect data from other electronic record companies, and we help them monetize that data for both insurance companies as well as pharma. We actually have the unique point-of-care connectivity. I've mentioned that before, but that's what I call -- we call the closed loop. So the data and the analytics, the Aha moment, has actually been able to be manifested down at the clinic at the physician level immediately, not something that is cause of a delay or somebody from a Chief Clinical Officer trying to make rounds at some other point in time looking at data on a spreadsheet. It's actually presented in a consumable way to that caregiver where it's relevant, where the decision can actually be made during that golden moment, if you will, when the decision needs to be made to make the clinical impact that all of these data are suggesting could be done as a result of a different protocol that should be delivered. The portfolio and the scalable foundation of this is also incredibly important to what we do and how we've done it. And again, you have to have scale, you have to have a certain level of data that are important to very large organizations. It has to be enough of a buffer population. And in our case, we have millions of people that are inside of this data set that have been separated cohort as well as taking the duplications out of it, and we also understand the importance of that from a pharma standpoint as they are looking for specific patient types, in some cases, for the clinical trials that they may want to perform or they're looking for specific examples of how some of their medications were metabolized inside of patients, and they're looking for the outcomes that came as a result of that patient population, utilizing that medication. It's all, again, very important. And this organization is very agile. We run it as a separate business unit. They have their own separate funding, and this has been a very important piece of the Allscripts story is not only in the past, but as we go forward. As we look at then to Page 12, please. All of these resets have created a financial flywheel that we think are important from any investor perspective. We created financial visibility that we think is very key to anybody that's making a long-term investment in a company like ourselves. We have a very highly visible revenue base. We have substantially expanded our EBITDA margins over the course of the last year. And as I said earlier, we're not finished there yet. We have improved substantially the cash flow that have come out of the company, and we have expectations of that cash flow being in the $90 million to $100 million range in the 2021 calendar year. But again, it's been a very high -- big focus for us, not only because of the cost structure coming out, but also because of the focus on our ability to collect the cash has been important as well as some of the things that we've had in the past. Those will not be impediments as we look at 2021. With regard to some of the onetime charges, we will not expect many of those in the 2021 time frame. And certainly not like we had in 2020 and not like we had in 2019. And we'll continue to focus on these things. We'll continue to be focused on delivering value to our shareholders, and we'll be continuing to focus on unlocking value if, in fact, that, that is something that we need to do. Slide 13. In closing, the key investment highlights for the company that we have a robust, diversified portfolio. We are relevant in this marketplace. We're relevant from a size standpoint. We have a high recurring revenue model. This is compared to what the model looked like 8 years ago when we had a license model, we don't need to go all the way back there, but there's a completely different financial underpinning of how we run the company as a result of the decisions we made over time in the way that we have constructed our relationships with our clients, and we will continue to do that in that regard to create highly recurring revenues for the company. We have -- the future growth is going to come from a number of different areas, but specifically around the data assets that we have around the relationships that we have established and will continue to expand inside of our -- a pharma payer life sciences, our global business, our ambulatory business, our consumer business, our interoperability business and the electronic medical record business that we've had in the inpatient side as we have continued to enhance our portfolio by building organic solutions to fill out that portfolio, which gives us cross-sell opportunities there. We have a very strong balance sheet as we talked about, and that we're very proud of all the work that's gone on over the last couple of years to create that outcome as we sit here in January of 2021. It's the strongest that it's ever been since I've been the CEO. We have a significant operating leverage. So we expect, as you saw during the course of the last 2 quarters, the last 3 quarters, the last year, to see the flow-through of the top line, making it all the way through to the business into the EBITDA margins, into the manifest now into the share price. We will continue -- you'll continue to see that. And you'll continue to see that leverage being delivered as a result of our being very focused on making sure that we are operating as efficiently as we possibly can. And we will also continue on the track record that I'm very proud of making sure that our capital allocation strategies are robust, but there is efficient as they possibly can be. On the value creation side, we'll continue to focus on that. And to the extent that there are value unlock opportunities that are there, you will see us continue to manage that as we have in the past. This team has done, in my opinion, a very good job of capital allocation over the course of the last 8 years. We've demonstrated that we will make very difficult decisions. We'll also demonstrate our fleet afoot to make sure that there are things that are more highly valued on the outside. We'll take full advantage of that as well. Thank you very much for your time. We appreciate your interest in Allscripts, and we look forward to the Q&A. Michael, back to you.

Great. So thank you, Paul, for walking us through the presentation. It was very informative. I am going to lead up the Q&A here, but I do want to remind everyone about the Blue button, if you would like to ask a question, please feel free. So with that, I'm going to start off, as you talked about, 2020 was a transformative year for Allscripts, taking a substantial amount of expense from the business. You talked about raising the EBITDA margin outlook for the fourth quarter versus the prior outlook. Can you talk about what's sort of driving that this quarter? And then maybe taking a step back, can you discuss key elements of the broader margin expansion strategy? What have you taken so far? What's left to do?

Michael, this is Rick. I'll take that. So we're on a journey. With respect to margin expansion. And as you said, we do see it -- we saw it continue to progress during Q4, and we're quite happy with that. We've gotten there a little bit by being a little more selective with top line. We have shed some revenue that I think was lower impact revenue and, frankly, not worth our time trying to pursue. But mostly has come on the cost side. And we've used the COVID environment and the kind of the slower buying period as good, I think, calibration to set our revenue against and really work to match our cost targets toward that. And our efforts have been very comprehensive up and down the P&L. So we've done a lot of work on things that hit our cost of sales. Most of that has been about getting our labor teams more productive, more in sync with the revenue that they generate. We've done a little bit of work in our R&D area and our development area on moving more of our development effort to our India-based operation. And so we're getting a lot more yield out of our investment dollars there. And our SG&A costs, our overhead costs, we've done, I think, a pretty good job of trying to get at those and again, rightsize them for the size of operation we are. So it's been very comprehensive. We're not done. There's areas that we still see opportunity in, and we'll continue to pursue those as we go through 2021. So we had set out some margin targets earlier in 2020 for our 2 reportable segments. With our second segment, now that we've disposed of these 2 businesses, we'll have to do a little recalibration with the investor base on that given to reflect the fact that those 2 businesses are gone. But in general, we're still aiming towards the margins that we talked about, and we'll continue to work them as we go through 2021.

Maybe just a follow-up to that. Could you remind us what your longer-term margin targets are? And sort of what kind of revenue run rate is necessary to achieve those?

Yes. So we have provided guidance for our 2 reportable segments. So we have our core clinical and financial solutions segment. And in that segment, we had said we wanted to get to 18% to 20% EBITDA margins. For sure, we weren't there when we put those out there. We're still not there. But again, it's -- as I said, we're on a journey to get there. That segment did not get disrupted by the 2 asset dispositions. So those goals remain intact, and our progress will continue there. The second segment, our data analytics and Care Coordination segment. We had a target for 30% or better. Adjusted EBITDA margins. We'll get there probably in Q4. But again, as we say goodbye to those 2 businesses that we sold, there'll be need to recalibrate there. And we'll probably provide some more information on that as we get with our guidance that we'll provide probably at the end of year reporting. But we'll continue to -- we built those goals really in the revenue environment we have. And as Paul mentioned earlier, we do expect to get operating leverage. So as we get revenue growth going forward, that will certainly help drive some of that improvement.

Great. That's helpful. Historically, the company has been very acquisitive. But over the last year, it seems you've been focusing more on sort of streamlining the core now. Where do you see opportunity to invest in growth going forward?

We'll continue to invest around our provider assets. We'll invest in bringing solutions that our provider clients want. So a good example of that in 2020 was around telehealth and some virtual care tools. We'll also continue to build-out, I think, our RCMS services for -- particularly for our ambulatory clients. That's an area that they definitely seem to want help in, and we've seen some nice growth in that. But we'll also invest along with our Veradigm business. It's a differentiated asset. It's a business that not only do we get to leverage our own data set and our own point-of-care presence. We actually have 2 of our large competitors who have asked us to help them monetize their assets as well. So it's -- I think it's a really good indicator that we have something differentiated there, and we'll continue to invest in that business.

Great. Maybe on the topic of value-based care, it seems like we're always on the cusp of an acceleration there. Can you speak to what you're seeing from your customers in terms of appetite for risk and how you're positioning to capture that trend?

Sure. The value-based care component has been around actually for quite a while. And in all of our clients, they have some modicum of it. In the West Coast, you have people that are at probably full cap risk. In the East Coast, you have some even in the Midwest, you have people that while they do a fair amount of their business on fee-for-service, they're doing some business that's on some sort of capitated rate. So that will, I think, continue for now, I think. I know it will continue to accelerate over time, CMS came out with a number of bundles. They have experimented with that over time. My expectation with the new administration is that they will continue to support what CMS has already put underway. And there's no question in my mind that the cost of health care being such a focus in the United States, and the lack of connection between cost and quality historically will be more manifest through the connection of paying for performance. And the paying for performance in this regard is going to be through capitation or through some value-based care payment. So over time, it will continue to grow. But I don't forecast that being 50% any time soon, even though when it first came out 5 years ago, it was expected to be fully capped everywhere. But living in both worlds, people become unfortunately used to that, and that requires a fair amount of work on the back end, if you will, for people like us that have to do all the automation for that and all revenue cycle capabilities around that. We think, though, that creates opportunities for us because it's complex.

Right. When we look at the core EHR business, on the replacement opportunity, who would you say you're taking share from? And sort of what opportunities remain for increasing penetration there?

I would say that, that depends upon what markets you're talking about. In the ambulatory marketplace, there's a number of small competitors that we've talked about over time. Scale actually matters and scale matters with regard to being able to have a robust set of operatings, whether that's revenue cycle, IT outsourcing, precision medicine, consumer front door capabilities. And as organizations are looking for that, even though you may be small and maybe a small ambulatory practice, we'll probably be looking for components of that as you think about electronic not correct. So people, competitors that don't have all of those different capabilities are people that are -- we're taking business away from. We've got some that are out there that have made some sort of declaration about their desire to get out of certain elements of the business, just like we've seen in the past. And so those also present opportunities for us. In the inpatient marketplace, there's some smaller competitors that are problematic. We also have some of our larger clients who are buying hospitals that are not doing well, some of which those hospitals became much more efficiently purchased during the COVID crisis. And those guys are putting in Sunrise into those organizations. So at times, it's because of an acquisition. And then there's others that just historically have not made the investments that we've made in order to really be truly, I think, aggressive in the marketplace with regard, again, to inoperability, consumer, post-acute care, precision medicine. Those are all topics that most organizations that are thinking about making a 5-year -- 5- to 10-year acquisition are looking at who's going to take the throughout the course of the next 10 years of not just being a good EMR player, but also who can be there for the long term. And then lastly, outside the United States, it depends on the country, but there's not really any single dominant player in any one of the countries that we -- our market are selling into. And therefore, that creates a fair amount of greenfield for us. And we've been successful outside the United States in the markets that we've chosen to go into. And our expectation there is that we will continue to do relatively well. Our international business, as people know, is not a very high percentage of our total overall revenues, but we hope that acceleration of that business over time will create a much larger footprint for us.

Maybe just following up on that. How penetrated would you say you are relative to the total opportunity on the international side? And sort of what regions are focus areas for growth?

I'd say it's less than 5% penetrated. So that there's some opportunity. We're big in North America, we're big in the Asia Pacific realm in areas where they speak used English. So Singapore is a big marketplace for us. We've actually install in the Middle Malaysia, Guam, other areas in the Pacific Rim. And then the United Kingdom has also been another very good marketplace for us. And we've recently been through interoperability platforms where English is not a prerequisite like in Israel, where we have a dbMotion solution that is, if you will, language agnostic on the EMR side, in the Middle East, it's again where there's typically where it's North American trained clinics or hospitals' staff are there that -- where we see opportunity in that part of the world as well.

That's helpful. Just wondering if you could provide some color on the cross-sell opportunity in your existing clients? How much of your organic growth is going to be driven by layering on new products?

I would say that on the Sunrise marketplace, there is capability today that we didn't have 5 and 6 years ago around surgery, around emergency rooms, around HIM, around our solution for radiology or solutions for revenue cycle. So just the pure software to be able to go do that. And many of our organizations don't have an entire portfolio. You'll see us make announcements where people have gone all in. And that's where organizations have decided to do ambulatory inpatient EMR, ambulatory inpatient revenue cycle on software with us, and those are some of the larger, if you will, extensions that we've done. From a professional services standpoint, from a managed services standpoint, from an IT outsourcing and from a hosting standpoint, we will continue to selectively look for clients that are able to make -- where we can make profitable relationships with those organizations that meet, if you will, the thresholds that we have for making sure that we are doing that business on their behalf, but also doing it in a way that allows us to enjoy some of the work that we've done throughout the -- throughout 2020 where we set thresholds on where we want to be doing business. We want to be doing that business in a profitable manner. That is -- so that the -- so there's, if you will, percent of wallet concept that goes with that, that allows us also to grow. And the last one, I would say is revenue cycle outsourcing in the inventory environment. This has been a pretty important component for us over the course of the last 3-plus years, allows us to have a differentiating competitive advantage versus some of the other folks that are out there. That's a good piece of -- that's a good business for us. That plus the electronic medical record, plus the registration scheduling system. The rest of those applications from an ambulatory standpoint that allow us to also grow that business. So that is also where some of the organic growth will go. The other piece will be, obviously, what's going on with Veradigm, which we talked about quite a bit already today.

Great. That's very helpful. So with that, it looks like we're at the bottom of the hour, sort of coming to the end of our time. I just wanted to thank Paul, Rick and Stephen, for your insights today. And wish everyone luck for the rest of the conference this week, and have a good day.

Thank you very much. I appreciate it and appreciate being invited.