CareMax, Inc.

Reported 2023 revenue was $751 million, including $45 million of headwinds from prior-year developments (PYD) and $5 million from reserves, and adjusted EBITDA was negative $63 million. Q4 adjusted EBITDA was impacted by approximately $21 million of net unfavorable PYDs, and Q4 GAAP net income included a $369 million non-cash goodwill impairment. Full-year 2023 total medical expense ratio was 91.5%, with about 780 basis points of impact from PYDs and reserves, and MSO members contributed 450 basis points. Full-year 2023 also included $23 million of de novo losses, slightly better than guidance of approximately $25 million. Management did not give precise 2024 financial guidance, saying it was premature, but described 2024 as a transition year and said its plan is intended to position the company for a favorable inflection in 2025.

Carlos de Solo focused on preserving earnings power and liquidity while the company rightsizes for the current environment. He said CareMax is shifting toward performance and profitability over growth, with large-scale cost reductions, workforce streamlining, and center consolidations already underway. He also emphasized strategic options for monetizing assets and right-sizing the capital structure, while framing 2024 as a transition year and expressing confidence that clinical initiatives can improve medical expense trends.

Kevin Wirges highlighted that Q4 and full-year results were weighed down by PYDs, increased medical and flex card utilization, and a provision for adverse deviation. He cited about $21 million of net unfavorable PYDs in Q4, $42 million of total PYD for 2023, $15 million of reserves for adverse deviation, and $23 million of de novo losses. He said the company ended the year with approximately $66 million of cash after drawing the remaining $60 million of the delayed-draw term loan, and noted that strategic discussions and liquidity actions are intended to bridge the company to the expected MSSP payment later this year and into 2025.

There was no formal analyst Q&A in the transcript provided. Management instead addressed the main investor concerns directly in prepared remarks: data timing and accuracy from newer contracts, Medicaid redeterminations, and flex card utilization. They also said they are analyzing contract-level unit economics and may refocus resources on payers where the economics are less favorable or the costs to manage outweigh the benefits.