Earnings Call Transcript - MSPR Q3 2022

Operator, Operator

Good day, ladies and gentlemen. And welcome to MSP Recovery's 2022 Third Quarter Earnings Conference Call. You can view the video webcast presentation by accessing the link at the MSP Recovery website under the investor events section. As a reminder, this call may be recorded. I would now like to begin today's earnings presentation.

Alexandra Plasencia, Host

Good morning, everyone. And welcome to MSP Recovery's third quarter 2022 earnings conference call. At this time, all participants are in a listen-only mode. Before we begin, please note that statements made during this presentation, which state the Company’s or management's intentions, beliefs, expectations, or predictions of the future are forward-looking statements within the meaning of the Private Securities Litigation Reform Act and actual results could differ in a material manner. Additional information about factors that could cause results to differ from those in the forward-looking statements is contained in the Company's SEC filings. This includes, but is not limited to, risk factors contained in MSP Recovery’s SEC filings and in the news release issued earlier today. A copy of these materials can be found in the Investors section at msprecovery.com. Non-GAAP financial measures are included in our comments today and in our presentation slides. The reconciliation of these non-GAAP measures to the corresponding GAAP measures is included at the end of the presentation slides and can be found in the Investors section of the MSP Recovery website. The participants on today's call will be Founder and CEO of MSP Recovery, John H. Ruiz; Chief Information Officer, Chris Miranda; and Chief Financial Officer, Calvin Hamstra. I would now like to turn the call over to John H. Ruiz.

John Ruiz, CEO

Good morning, everyone. I'm John H. Ruiz, CEO of MSP Recovery. Welcome to our earnings call. Today, we will share MSP Recovery's third quarter 2022 highlights, earnings, and an overview of recoveries. I will provide some quarterly highlights while Chris Miranda, our CIO, will discuss data matching, and Calvin Hamstra, our CFO, will walk you through our quarterly financials. Now I'd like to discuss some of our third quarter highlights regarding MSP's recovery efforts and the LifeWallet platform. As announced on October 13, 2022, MSP negotiated a $63 million debt reduction with Brickell Key Investments by entering into a new warrant agreement. In addition, this transaction is expected to save about $40 million in interest expense year-over-year until such time as recoveries would have otherwise covered the debt. On our recovery efforts, our paid value of potentially recoverable claims continues to grow. As of September 30th, we have $89.2 billion in paid value of potentially recoverable claims. This balance of potential recoverable claims exceeds our projections by three and a half times. We continue to make progress in our recovery efforts towards larger settlements. Notably, we recently settled an accident-related case in which we collected $1.75 million at two times the recovery multiple and a Group Health Plan recovery for $1.15 million. The accident-related settlement is consistent with our projected recovery multiple, and the Group Health Plan recovery represents a recovery that was not identified within our PVPRC. As mentioned previously, we continually seek to find new potential recovery paths, and this represents a recovery that was never funneled or identified within our reported PVPRC, which is $89.2 billion. Unfunneled recoveries are not included in our projection of potential recoveries. This represents an important opportunity within our recovery rates, which can provide an upside to recoveries. During our second quarter, MSP announced the implementation of a new strategy that would enable primary payers to make their required payments prior to engaging in litigation. Thus far, we have sent over 22,000 demand letters and have received payment on approximately 130 of those demands at a recovery multiple of 2.1 times. I will highlight responses and the process further in Slide 8 when I update on recoveries being sought. This quarter, we had some notable court orders. First, the Second Circuit affirmed a district court order that granted summary judgment in favor of Aetna, a Medicare Advantage organization, solidifying the right for a Medicare Advantage organization to sue primary payers under the MSP Act in the Second Circuit. MSP Recovery filed an amicus brief in support of Aetna in that particular case. Further, the 11th Circuit ruled in favor of Tower Hill Prime Insurance Company and found that MSP's claim in that case was barred by the statute of limitations. In that case, the 11th Circuit held that the applicable statute of limitations to a claim under the MSP private cause of action was four years from the date the primary payer violated the act. Lastly, MSP had a significant win before the 11th Circuit in MSP versus Metropolitan Insurance Company, in which the court held that MSP's allegations within the complaint were sufficient to survive motions to dismiss, which are often filed by defendants in our cases. This decision solidifies our legal strategy and has paved the way for us to file a significant amount of cases in the remainder of 2022 and going forward. As it pertains to LifeWallet, we entered into a one-time licensing agreement fee of $7.5 million and then a $1 million fee per year in servicing for 2023. We also announced the formation of LifeWallet Legal Referral Services. We expect to roll out the legal referral services between the end of 2022 and the first quarter of 2023. I want to take a moment to highlight some factors significant to our continued growth. Even though we started 2022, having exceeded our projected value of potentially recoverable claims by more than three times at a figure of $86.6 billion as opposed to the expected $21 billion, during 2022 we continue to grow with new clients as well as new recovery rights assigned by existing clients. During 2022, 89% of our growth in potentially recoverable rights came from existing clients. As we have stated previously, we are engaged in data matching with over ten auto insurance carriers. Through this process, we have identified over $5 billion in possible accident-related treatments paid by our clients. During the quarter, via litigation settlements, we received $1.9 million in recoveries at 2.1 times recovery multiple. Chris Miranda, our CIO, will provide a presentation with an overview of data matching. We believe data matching is an important tool in developing recoveries to identify specific recovery rates. In 2022, we deployed a new strategy utilizing demand letters that will enable primary payers to make required payments outside of the purview of litigation. To date, we have sent out over 22,000 demand letters. We have already received over 130 payments at a recovery multiple of 2.1 times with first-party liability claims at 1.8 times and third-party liability claims at 4.4 times. Of the 22,000 demand letters, we have only received 3,342 responses. The remaining are still pending. Most of the replies simply requested additional information from MSP in order to process these claims. During the nine months ended September 30, 2022, through consolidated, unconsolidated and affiliate entities of MSP, MSP reported $7.9 million of claim recovery income. Of that $7.9 million in claim recovery income, 51% or $4 million of those recoveries were from previously identified recovery opportunities as represented within our paid value of potentially recoverable claims. The remaining 49% of our recoveries came from recoveries that had not been previously identified in the paid value of potentially recoverable claims. We believe this is significant as it highlights the upside in our recoveries. As noted in this table, the initial recoveries are above our projected recovery multiple and including these unfunneled recoveries, our overall recovery multiple would be 3.7 times the PVPRC. Although we have not yet publicized an overall recovery multiple in our KPIs at this time, our initial recovery efforts are above our projected figures. The 2022 guidance was developed as part of our business combination. As of September 30, 2022, we surpassed our 2022 guidance as it relates to the paid value of potentially recoverable claims by 3.5 times the previous projection. Our revenue guidance is dependent on the completion of data matching and achieving settlements in our cases. We feel comfortable that there is progress being made toward meaningful settlements in our recovery efforts. For our 2022 guidance with respect to total gross recoveries, we expected total gross recoveries to be approximately $992 million. While we anticipate that the amount of those total gross recoveries will be achieved due to various factors, including but not limited to, cases that have been appealed, we expect that a portion of those recoveries may spill over to 2023. However, unlike many other businesses, because recovery rights are liquidated damages, which is an amount that is known as it relates to the amount that is being claimed, these potential recoveries pursuant to law accrue interest. Because of the multiple being achieved, the interest rate would likely be 2.11 times the legal rate of interest as the interest is calculated from the collected amount versus the PVPRC amount. The guidance provided was and is an estimate based on management's current knowledge and various assumptions. The nature of the company's business and the timing and amount of total gross recoveries that will be achieved are inherently unpredictable, and the company cannot provide assurances regarding the timing or the amount of total gross recoveries that will ultimately be achieved. Now I'd like to turn things over to Chris Miranda, our CIO, to explain the process of data matching.

Chris Miranda, CIO

Thank you, John. MSP Recovery regularly data matches with primary payers through both court orders and party agreements. Deposition testimony reveals that primary payers lack the data elements to comply with federally mandated Section 111 reporting requirements. MSP Recovery’s data and experience demonstrate that primary payers report less than 10% of the time, which is why data matching is a critical component in maximizing the identification of reimbursements. Data matching is the association of a record in one data set with a record in another data set. When both sets have consistent unique identifiers such as social security numbers, certain techniques are used, but oftentimes those key identifiers are missing, in which case additional methods have to be employed. MSP Recovery has developed data matching techniques, which take into consideration missing or fragmented data sets and other variables, whether they be human error, such as typographical errors, unknowns or other invalid entries, or the differences in variations of data storage. MSP utilizes numerous data matching techniques, both deterministic and probabilistic, which have been tested, including techniques utilized by the Centers for Medicare & Medicaid Services, among others. Unlike the data relied on by CMS, data matching provides a direct pipeline to primary payers that is not reliant on voluntary reporting by responsible parties. This has allowed MSP to discover a significant amount of previously unidentified recoveries. The process of data matching between two data sets at the highest level involves the following: producing, inspecting and cleaning, prepping, applying the algorithms, and reviewing and exchanging the results. All of the steps in this process are automated, allowing for maximized speed, efficiency, and scalability. Currently, MSP utilizes 76 different data matching techniques, which have been developed in collaboration with primary payers through prior experience and testing that has improved over time. The process for claims submission and review includes examination in which the parties evaluate the results and collect key data points of interest, such as payments rendered and the policy limits. Then there's an exchange of valuable information, a determination of the matches at issue, an exchange of claims data, a reconciliation of payments, and the resolution of any disputes. To date, MSP Recovery has engaged in data matching with over 13 different primary payers, representing approximately 28% of the addressable auto liability market. These primary payers include some of the nation's largest auto insurers. This process has yielded hundreds of thousands of potentially recoverable instances previously not identified through other methods, putting MSP in a unique position to facilitate meaningful and effective settlements on behalf of its healthcare clients. I'll now turn it over to our Chief Financial Officer, Calvin Hamstra.

Calvin Hamstra, CFO

Thank you, Chris. Good morning, everyone. I'll be giving a brief overview of our quarter three 2022 financials. To start, I'd like to cover some highlights of our financials for the quarter. As noted previously, our management team was able to renegotiate debt that resulted in a gain of $63 million for the quarter. Not only does this clean up our balance sheet, but it will also reduce interest expense that would have been incurred by approximately $40 million per year. On the asset side, we had non-cash amortization on our $2.1 billion of intangible assets of $66 million for the quarter. This reduction to assets was offset by purchases of intangible assets of $48 million during the quarter. These purchases continue to build on our unique portfolio of claim assets and will continue to build our amount of potentially recoverable claims. Our income statement for the period again has the gain on debt extinguishment, and we are also starting to see claims recovery income increase. While still minimal compared to our overall potential recoveries from our assets, the recoveries from the quarter did show upside as the recovery multiple was above our projection, and also noted previously we obtained recoveries that were outside of our funneled potential recovery amounts. Many of the drivers on the expense side were non-cash items, such as claims amortization and paid in kind interest. But for the interest, as noted, it will be reduced in the fourth quarter as part of the debt reduction. In order to reiterate and better describe the impact of these assets, we are providing a breakdown of our revenue streams and how these would be recognized. First, for claims recovery income, this is recognized through ASC 450 or the gained contingency model. This means that the company doesn't recognize revenue on these recoveries until there is a settlement or cash has been received. This method requires a known amount and timing before recognition. We have outlined in the table the amount recognized under this method for both the three and nine months ended September 30, 2022. We have also outlined claims recovery income that has been achieved in portfolios that aren't recognized in the company's financial statements, as these are not currently held by MSP but that MSP has rights to future recoveries if certain thresholds are met. In addition, we have outlined the recoveries being sought under this recognition method. This includes the paid amount shown in Slide 8 for accident-related claims of greater than $5.3 billion, fraud and misconduct claims of nearly $5.3 billion, and group health plan claims of $2 million. Next, the company also recognizes revenue through claims recovery service income. This is recognized through ASC 606 and is recognized as performance obligations are completed. For the quarter and year to date, this has equated to approximately $5.7 million and $17.8 million of revenue. We anticipate through a licensing agreement that has been executed to have an additional $7.5 million in revenue when the performance obligations are complete on this agreement. Similar to the prior quarter, in order to help look past some of the noise in the financials related to the business combination, we have highlighted the one-time or non-cash items that are flowing through the financial statements. This is a non-GAAP measure, but we feel it is important in order to understand what we would anticipate in expenses going forward. Within the income statement for the three months ended September 30, 2022, there were one-time non-cash items related to changes in the fair value of warrants and derivative liabilities related to the Cantor facility, which was disclosed in previous filings of $2.7 million and non-cash items for the period related to claims amortization expense, gain on debt extinguishment, and paid in kind interest. For the nine months ended September 30, 2022, there were one-time non-cash items related to a share grant to non-employees of $20.1 million and changes in the fair value of warrants and derivative liabilities related to the Cantor facility, which was disclosed in previous filings of $11.7 million. These, along with the one-time items noted, totaled $13.4 million for the three months and $95.7 million for the nine months. Excluding these one-time and non-cash items, our net loss was approximately $13.7 million for the three months and approximately $22.4 million for the nine months. Next, I'd like to provide the overall balance sheet. Just to highlight here, our non-current liabilities decreased from $348.5 million as of June 30, 2022, to $298.1 million as of September 30, 2022. While we continue to see growth in the historical claims held within the intangible assets and investment in rights to claim recovery cash flows, our management team continues to develop our Chase to Pay platform through LifeWallet that will allow us to address the issues in billing noted in our historical claims in real-time. Addressing these billing issues as they happen will not only reduce the expenses, time and litigation costs required to collect on these claims, but will also provide a revenue stream that is more consistent and predictable. On the income statement, as previously noted, the main drivers of our quarter and year-to-date losses are one-time or non-cash. Much of the continuing costs outside of these non-cash items are expenses related to maximizing the value and timing of realization on our historical claims and, as mentioned previously, the development of additional revenue sources such as LifeWallet. We continue to be laser-focused on not only extracting the value from our historical portfolio, but growing these assets through the acquisition of new data. At the same time, as we push these assets closer to realization of cash flows, we are complementing this effort with the Chase to Pay or LifeWallet platform that could be a true industry disruptor when it comes to healthcare data. We anticipate both of these revenue streams to begin to provide tangible returns and push strong cash flows from operations as we reach the end of 2022 and into 2023. Thank you all for joining us today.

Operator, Operator

Thank you. Our first question comes from Josh Siegler with Cantor.

Josh Siegler, Analyst

I'd love some additional color on LifeWallet, specifically how is the adoption trended over the quarter? Can you provide some more color around the recent new client wins?

John Ruiz, CEO

So LifeWallet was developed because as we found all these recovery opportunities, and this dated back all the way to 2014, we developed a system called Claims to Med, which essentially provides the transition from what I call somewhat of hieroglyphics, very difficult to understand claims data. If anybody's ever received something from an insurance company, it'll tell you what the diagnosis code was and the CPT code, and it was difficult for even our internal teams to read that. So what we did is we transitioned and created our own system to be able to provide our staff with the ability to read through these claim records quickly and identify what essentially provided to be the historical records of a person and what happened. If you look at what we've done as it relates to our particular business, we've gone through all of the diagnosis codes. They changed from ICD 9s to ICD 10s a couple years ago. And what we do is that we sort of flag the ones that are atypical or asymptomatic, people that don't normally have fractures unless there's an event, and obviously we carve out for osteoarthritis and things like that. But the bigger picture that LifeWallet provides is that there's a disconnect in the entire medical industry, and we have very good doctors, very good medications, and very good medical devices. But the healthcare system has a horrible way of ingesting data, highlighting exactly what should be absorbed, normalized, and how that connects one with the other. So if you think sort of like more from a layperson's perspective, imagine getting a bill and that bill has an invoice number with line items on it, that's the bill that a payer receives. When that payer adjudicates that bill, they have to adjudicate the number of the bill with the line items. Every line item represents a different reason why payment can and won't be made. What LifeWallet does with our new biometric technology, as well as blockchain technology, is that we are able to, and according to experts that we've discussed with, specifically the Polygon platform, we now have the fastest blockchain system in the world as it relates to medical bills and claims of this nature. What LifeWallet does is in a real-time process, when a person goes to the doctor, because we connect through what's called APIs, we are able to sort of intercept that encounter by that patient immediately at the same time we can identify who the proper payer is supposed to be. Our business primarily focuses around proper payers. Obviously, since we've indicated and prevailed that Medicare is a payer last resort as well as Medicaid, the real question becomes who is supposed to pay a bill, at what rate and at what interval. LifeWallet does this in real time as opposed to this historical fashion of receiving flat files. And what it does essentially is we intercept the 837 form, that's probably a lot more technical than anybody wants to listen to, but if somebody's really taking down notes, we intercept the 835, we're able to blockchain that, we then receive the 837, and then we get the adjudication, which is the 835, we piece them together, and we're able to put the smart contracts of payers, we're able to put the smart contracts of primary payers, which are the auto insurers as opposed to the Medicare Advantage organizations. And also, this prevents fraud because our biometric technology embeds the 2,200 points that we capture of a patient together with the 837 bill. A lot of fraud that occurs in the United States of America is as a result of doctors or other medical facilities that submit bills when the patient actually hasn't received the treatment. If you look at the details of Medicare, they review two-tenths of 1% of bills. So most bills go undetected. So what LifeWallet does to kind of recapture and tell you why we know that this is so powerful is that the LifeWallet processing system does away with waste, it does away with fraud, it identifies a proper payer much quicker, it allows for the providers and payers to more quickly identify what their actual responsibility is. And instead of going through this historical analysis, which is what we've been doing for many, many years, we now have that as a real-time solution. And then you asked another question. So all of our clients, we have many of them that are right now in the process of reviewing it, some pilot programs have been established like with Cano Health, and some others have already paid licensing fees. We feel that this is a very powerful tool. And moving forward, we believe that our blockchain technology, because it's real time and everything gets captured, it'll fix a lot of the data issues. So we feel that the blockchain technology, together with LifeWallet, is a solution that would apply to patients, providers, as well as payers, and accelerates the ability of MSP to identify recoveries much quicker. So that's essentially the nuts and bolts of LifeWallet. If you have any follow-up, I'm happy to respond.

Josh Siegler, Analyst

And separately, I know you touched on this in your prepared remarks, and of course it's still early stages. But I was curious if you're starting to see any initial signs of success on the demand letter initiative? Is it working as intended and how does that transform the business as far as it comes to predictable revenue streams?

John Ruiz, CEO

So one of the nuances that I believe is important to capture in what we do, and I'll give it to you as an example, assume that you had a hundred apples, and that you claim that those hundred apples should be paid. And you're dealing with an opposite party that you're claiming that other party owes you for those hundred apples. Because of the accounting treatment that we have under 606 and under gain contingency, we cannot show any recoveries until such time as we have a complete resolution of all of those particular apples that will or will not be paid, and everything needs to have been signed off on. That presents, in our opinion, sort of a very unique situation where we know that out of the hundred apples, we've already solidified a certain number of those that are payable, and even the corresponding party may as well. The data matching process, which Chris Miranda spoke about, has made significant progress. In fact, just yesterday we received a lot of the information that we were waiting for some of the bigger, bigger carriers. This gives us a vantage point as to the future revenues. Anybody that's ever been involved in litigation knows that mammoth cases take a long time. A lot of times you see these as bell-curved recoveries. So I've been in litigation for 31 years. If you look at any litigation historically, whether it's asbestos, whether it's now the Roundup case, a lot of these cases that historically we've seen, even opioids that you see now, some of these cases take a while before they settle. Our ability to see and have the insight into what the connectivity is between the claims we've paid and those that are owed by primary payers has increased significantly. That is the reason why we can give better projections. And obviously what we're looking for, which I think we're making great strides in, is to sort of smooth out how we receive revenue and make it more consistent and predictable. So management is well aware of sort of I'm not going to say it's a necessity, but something that the market would want to know to establish a more consistent view and pattern as it relates to revenues. From our vantage point, because of one of the particular data points that we described, and I think this becomes very important and even the question that you asked, is that if you look at the recoveries we've made thus far, 51% of those recoveries were ones that we were able to identify and detect by reviewing data and using our protocols. An alarming 49%, in a very good way, to my surprise, were from recoveries that we had not detected and were unable to detect. And the reason why those are unable to be detected and the LifeWallet process may give us more clarity with that is because when we look at data, we look at fields and we look at populated data cells within those fields. Only that which comes within the data can we then create rules and algorithms to detect. So for example, if somebody was exposed to Roundup, there is no claim line field that will provide us with the basis that somebody was exposed to Roundup. However, there is a claim line field that somebody may have taken a particular medication. So if I compared a medication causing cancer with Roundup causing cancer, I would be able to detect the medication, but I would not be able to detect the Roundup first time around. And these are cases, for example, with medical malpractice, with smokers and cases, talcum powder, cases that we detect because people are pursuing them, and then they come back to us for purposes of resolving those.

Operator, Operator

And our next question comes from Kyle Bowser with Lake Street.

Kyle Bowser, Analyst

So maybe the first one on LifeWallet. Clearly, it is becoming an important new intermediary or clearinghouse, if you will, to really help keep the primary payers honest. How have you been driving adoption with this tool, and how do you and kind of the commercialization team size up the market here initially?

John Ruiz, CEO

That's an intriguing question. We've found that understanding LifeWallet is a quicker process than explaining MSP. As a result, it has garnered remarkable attention. We find that there isn’t any provider, hospital, or payer who isn’t positively overwhelmed by what LifeWallet offers. It stands out in the market because we believe no one else combines data understanding, healthcare, and legal components as we do. We look at health claim data while also considering legal liabilities, assisted by data analysts who identify flaws. A common saying is "garbage in, garbage out," so many systems focus on correcting what I would refer to as poor-quality data rather than addressing the fundamental issues. For instance, we previously dealt with flat files but are now requesting raw data, like 837 and 835 files. This enables us to identify mistakes made by health plans or others in the industry, and we have discovered a significant number of errors. From a statistical standpoint, it’s clear coding isn’t executed properly. Ironically, our system effectively captures diagnosis codes, yet many of these codes are not accurately documented. A reason for this is that in the Medicare Advantage sector, revenue is generated from around 80 distinct medical conditions. For example, a fractured ankle from a slip and fall isn’t typically prioritized because it does not yield additional premium funds for Medicare Advantage beneficiaries. The system is skewed as a result. It’s crucial to determine whether an accident occurred since recovery multipliers would be much higher, but the industry operates differently. Nationwide advertising from auto insurers often emphasizes that no claims mean better rates, leading Medicare beneficiaries to present their Medicare card instead of their auto insurance. This is where misalignments occur. Understanding the nuances of this entire process and the marketplace is essential for us. We feel we’ve developed tools combining blockchain technology with the LifeWallet process, among other components, to create a unique ecosystem capable of incorporating police reports, fire rescue reports, and information regarding over-the-counter medications or natural substances people may take. We’re expanding in this direction to enhance our detection capabilities. We have also established a LifeWallet legal referral system and have sought approvals from various states to initiate it. We've already received approval in Florida, with only a few other states requiring it. In the remaining states, we can start marketing because we have established strong relationships with lawyers nationwide. Our platform will allow lawyers to pay us to market their services, process their cases, and utilize our unique system to resolve liens and obtain relevant information about their accident cases, whether they involve auto incidents, slip and falls, workers' compensation, medical devices, or pharmaceuticals. Given my 31 years of legal experience, particularly with numerous auto accident cases and involvement in significant cases like the recent tower collapse in Miami Beach, our team—comprising medical experts, Chief Medical Officers, data scientists, and specialists—has the insight necessary to address these issues effectively. I believe we've made a significant impact on the market. To answer your initial question about LifeWallet's future, a considerable number of people and providers are interested in the product. While implementing it requires time to navigate HIPAA concerns, data breaches, and APIs, we anticipate that this quarter will reflect some impact on the fourth quarter, and for next year, we expect that it will play a substantial role in expanding our new cases and revenue from various streams.

Kyle Bowser, Analyst

And then my follow-up, more broadly, I guess, as the possibility of a recession looms. How might, if at all, the claims rights value become impacted? And I'm thinking in particular about collectability during a market downturn. Do we anticipate things changing at all as a result of that?

John Ruiz, CEO

That's actually a great question. We've circulated that in turn, the one thing about legal cases and healthcare that doesn't get better or worse, whether the economy's booming or doing bad or interest rates are higher or lower. The one thing that it could do in a positive way is when interest rates are higher, the interest rate that states and/or the federal government uses changes depending on the interest rate that's out in the marketplace. So I think that would have a positive effect from a liquidity — liquidated damages sort of claim that can grow by interest. Our business is pretty much, to the extent from our view, whether it's recession-proof or proof versus a bull market, the market could be doing spectacular, we're not going to do any better. The market could be doing terrible and we're not going to do any better, not from a share price perspective, because that's a different set of tools that people look into; I'm talking about from a pure business. Legal claims are legal claims. These claims it's black and white. You're either owed it or you're not. Most of the claims that we have primarily deal with law, meaning black letter law as opposed to factual differences. Yes. Can there be discrepancies as to whether an insurer takes a position that a particular claim from a patient is payable or not? It could be. But 99% of all claims in the United States of America get paid without contestation. If that wasn't the case, it'd be bottleneck. So the truth of the matter is that as we look for these real-time flows, it gets better and better, which is the reason why we are very happy and comfortable with what we're doing. And I think we really have an internal team. And one of the things that I can say is that we've met, I mean probably just about everybody in the country that has systems similar to what we would have. And this may sound a little conceited on our part, but our system blows every other system that I've ever seen. And I think the reason why that's true is because we have that legal advantage of understanding and having tried cases as it relates to what happens in a court of law and the level of detail that one would need. And obviously, we've been very successful at the appellate court and being able to show that the law provides the support for all the claims that we've been pushing. I don't know the exact record, but I think we may have lost maybe two out of one, eight or nine, I don't know the exact number, but it's significantly higher. And the ones that we've lost, one of them was you can't use the MSP law to do what you're trying to do, which doesn't really change the substantive nature of it. And the other one was a statute of limitations, which we don't feel has a very big impact of any at all because the statute of limitations has to do with when you file a lawsuit, and our lawsuits have been filed from way before. So it doesn't really impact our inventory of collectible or approachable claims to a large degree.

Operator, Operator

Thank you. I'm not showing any further questions. Ladies and gentlemen, thank you for participating in today's conference. This concludes today's program. You may now disconnect. Everyone, have a great day.