Ladies and gentlemen, thank you for standing by, and welcome to the MEDNAX 2016 Fourth Quarter Earnings Conference Call. At this time, all participants are in listen-only mode. Later we will conduct a question-and-answer session and instructions will be given at that time. This call is being recorded for replay. And I would now like to turn the conference over to Mr. Charles Lynch. Please go ahead.

Thank you, operator. I'm going to read our forward-looking statements and then I'll turn the call over to Roger and Vivian. Certain statements and information during this conference call may be deemed to be forward-looking statements within the meaning of the Federal Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on assumptions and assessments made by MEDNAX's management in light of their experience and assessment of historical trends, current conditions, expected future developments and other factors they believe to be appropriate. Any forward-looking statements made during this call are made as of today, and MEDNAX undertakes no duty to update or revise any such statements, whether as a result of new information, future events or otherwise. Important factors that could cause actual results, developments and business decisions to differ materially from forward-looking statements are described in the company's most recent annual report on Form 10-K and its quarterly reports on Form 10-Q, including the sections entitled Risk Factors. In today's remarks by management, we will be discussing non-GAAP financial metrics. A reconciliation of these non-GAAP financial measures to the most comparable GAAP measures can be found in this morning's earnings press release, or annual report on Form 10-K or in the Investors section of our website located at mednax.com. With that, I'd like to turn the call over to our CEO, Roger Medel.

Thank you, Charlie. Good morning, and thanks for joining our call to discuss our results for the fourth quarter of 2016. The results we announced this morning wrap up a challenging year for MEDNAX, as we've invested in new businesses to diversify our company. So, it's been a learning curve decline, and that impacted our growth. And while we continue to add to our acquisition pipelines, the timing of getting those that you've done is always difficult to pinpoint and that can also impact our growth at least in the short-term. Underlying all of this, the pace of birth across the country remains subdued, which have slowed the growth of one of our core businesses neonatology. When all of these factors occur in the same period, you can see the effect that can have on our results in the near-term. At the same time though, we enter 2017 in a better position to add value to our partners and our patients, and also in a better strategic and competitive position in our industry. The investments we've made to diversify our business may create some volatility in our quarter-to-quarter performance, but they also increase our opportunities to grow over the long-term. So, as we enter a new year, I believe that our strategy is very much intact. And as a result, we do expect our pace of grow to improve through the course of 2017 from the level at which we ended last year. And I'd like to talk today about how we're looking at our different service lines and where we stand in our strategic plans for them. I'll start with radiology. At vRad, after taking steps to begin addressing the challenges we identified last summer, results for the fourth quarter were in line with our expectations, for now, the…

Thanks, Roger. Good morning, and thanks for joining our call. I'll provide an overview of our fourth quarter and some additional details in a couple of areas. For the fourth quarter, our net revenue increased by 12% to $831 million. Over 90% of this growth came from recent acquisitions. Our practice acquisitions contributed roughly two-thirds of that growth, and our acquisition of Cardon Outreach contributed the remainder. Looking at our same-unit metrics, same-unit revenue increased by 70 basis points. This was modestly below the range of our expected growth and impacted our results in terms of EBITDA and EPS. On the net reimbursement side, same-unit pricing grew by 80 basis points. We saw modest improvement in managed care contracting that were somewhat offset by an increase in our government payer mix and by a small amount of parity revenue that we received in the fourth quarter of 2015 that did not recur in 2016. Related to payer mix during the 2016 fourth quarter, we had a 20-basis-point unfavorable shift towards government payers compared to the 2015 fourth quarter. On the volume side, same-unit volumes decreased by 10 basis points. We had growth in anesthesiology, radiology and other pediatric services. But this was more than offset by declines in neonatology volumes and slight declines in maternal-fetal medicine and cardiology services. Our same-unit NICU days were down 1.8%. Looking more closely at our NICU volumes, same-unit first at hospitals, where we cover the NICU, were down just over 1% for the quarter with all of our metrics, admission rate and length of stay fairly stable. We did not see any particular geographical concentration where neonatology volumes were stronger or weaker, but instead saw variability from practice to practice. For the fourth quarter of 2016, our EBITDA was $168 million compared to $169…

Thank you, Vivian. With that, operator, let's open up the call for questions.

And our first question is from the line of Kevin Fischbeck with Bank of America. Please go ahead.

Great. Thanks. Wanted to understand a little bit more about the margin compression in the quarter, because that was, I think, the thing that kind of surprised us the most. I think, Vivian you said that the same-store revenue growth was kind of the biggest contributor too. Is there anyway kind of break it into the three buckets that you mentioned is kind of putting pressure on to the business?

Yeah. I mean by far, same unit coming in at what it did is, is the biggest component, Kevin. I mean, acquisitions did impact it. And like I said, ramp up of Cardon, but the biggest impact is definitely same unit coming in, at 0.7%.

So, I guess, then the commentary that you expect same-store revenue growth to be accelerating off of this space is important, I guess both from a revenue perspective but also I guess from a margin perspective. Can you provide a little more color around what those drivers are and the confidence that visibility, I guess, you have in that ramp as the years goes on?

Well, so, we certainly, as Roger said, we're not expecting. I mean, we think there's been volatility inverse. And certainly, if you go back to last year, there was volatility throughout the quarter. So, we do believe that that will turn around, and plus we're excited quite candidly that we've had pretty good volume increases at EBIT, vRad, anesthesiology and certainly now as we kick off Radiology. And so, I think that as we've said before, as you know certainly, the NICU specialty is one that has a lot of fixed cost components to it. So, as that improves, we do expect that to favorably impact margins.

Okay. So, I guess, last question. You've mentioned, I think last quarter that vRad was like a 3% to 4% drag in Q3. And you thought there's going to be similar to that in Q4. And then I think you said it came in line with your expectations. So, does that mean, it was a 3% to 4% EBITDA drag year-over-year in Q4?

Yes. Yes.

Okay. And then...

Yeah. And vRad, as I think, Roger said in his prepared comments, they've been delivering what we expect as albeit not what we originally had expected, but nonetheless, they performed to what we thought. So, yes, it's definitely in that range.

Can you just remind us when the comps get easier when you think that turns into a year-over-year kind of tailwind to growth?

Well, even in the first quarter we are expecting some favorable contribution from vRad, but again I think what we've said is that, we'll see that continuing to improve as we go throughout 2017 as we on-board more of these physicians and so they'll reduce some of the bonus pay that's there. They still have some bonus pay to the physicians. And so, I think you'll continue to see that happening, but we do have some slight positive contribution from them in the guidance we gave for the first quarter, sorry.

Okay. Great. Thank you.

The next question is from the line of Whit Mayo with Robert Baird. Please go ahead. Whit Mayo - Robert W. Baird & Co., Inc.: Thanks. Yeah. Maybe just looking at the fourth quarter anesthesia volumes, any way to parse out how the underlying growth trended within the fourth quarter? And can you just comment on any of the volatility you saw across the months within the quarter? Thanks.

So, I'm sorry, operator, but that question came across all durable, and so we didn't hear it.

Mr. Mayo, would you like to repeat your question once? Whit Mayo - Robert W. Baird & Co., Inc.: Yeah. Can you hear me?

We can hear you.

Yeah. We can hear you.

Something about profitable growth – try it again. Whit Mayo - Robert W. Baird & Co., Inc.: Yeah. No. Sorry about this, just looking for some color on the anesthesia volumes within the quarter. And if you can comment on the month-to-month trends that you saw within the quarter.

Well, no – are you talking about anesthesia or NICU? Whit Mayo - Robert W. Baird & Co., Inc.: Well, I'm talking about anesthesia specifically.

Okay. Whit Mayo - Robert W. Baird & Co., Inc.: How did those grow in the quarter? And then, if you can comment just broadly across all the specialties, the volatility that you saw across the months.

Yeah. So, anesthesia volumes have been positive, not only throughout the months, but throughout the year. And so that's been a positive contribution. We did have some slight negative volumes on our maternal-fetal medicine business, as you guys know, it's a smaller component as well as some cardiology, it's been favorable in some months and unfavorable in others, but overall it's been a slight favorable for the year. And then neo, as we said, has been up and down throughout the year. Whit Mayo - Robert W. Baird & Co., Inc.: Okay. And maybe just for Roger, if you can spend a second on Radiology Alliance. Obviously, you have a partnership with TriStar already, and I'm just curious if that was a factor for the group. And I think that they really want to grow within middle Tennessee and Kentucky. So, if you could talk about their growth plans, and how vRad maybe fits into their strategy and what they're doing?

Yeah. Good morning. Look, we're very excited about this strategy. It does seem to be resonating across the country with a number of practices with whom we're having conversations. This practice is specific with a very specific target for us, because not only the relationship with TriStar but also, as you pointed out, their willingness and interest in growing and in pursuing a strategy of growth throughout their state and even beyond their state. The only impact that it had in their relationship with TriStar had was, it just made it very easy to go have a conversation with the hospital, and say, we're looking to acquire the practice. And it just made those conversations just very easy, because we've got a really good relationship with them. But in general terms, what's exciting about what we're doing is, we have this asset, that is vRad, that is 500 radiologists now; 75% of them are subspecialty trained, which means that they're not just general radiologist, but they're subspecialty trained, they're pediatric radiologists and neuroradiologists, breast imaging specialists, et cetera. What that means is that we can now offer the hospital 24-hour a day coverage by the subspecialty training to physicians without the hospital having to spend additional dollars in supporting having this kind of reads available on a 24-hour a day basis, which is expensive. So, we're thinking of this as kind of a hybrid new model or the radiology model of the future, where vRad can read along with the radiologists on-the-ground, so that if there is a sudden spike in study in the afternoon or something, their turnaround time don't have to suffer because vRad can now pick up two or three or whatever percentage of that spike. They can provide weekend and nice coverage if the practice so…

So, every year, we will usually buy back, you know that. And so, we will expect to do that this year again. As we said, we have plenty of availability on our line of credit. So, we'll continue to do that. Whit Mayo - Robert W. Baird & Co., Inc.: Okay. Thanks.

Thanks, Whit.

A question from Ralph Giacobbe with Citi. Please go ahead.

Thanks. Good morning.

Good morning.

Would organic growth of 1% to 3% drive any margin leverage at this point?

Well, it will certainly improve from where we ended up in the fourth quarter, because as I've said, Ralph, on the organic growth side needs to be pretty much north of 3% to have some favorability on margins. But certainly, it will impact that from 1% to 3%.

Okay. So, I guess, what I was trying to get at, look, when we look back at some of the deals that you've done over the last year, we're estimating kind of just under a $10 million sort of incremental EBITDA contribution for the first quarter, which would drive in and of itself about 6% EBITDA growth. So, just wanted to understand, first, I guess, if that's fair, and then, is the pressure or the pressure on sort of the core growth, if you will, just a reflection of sort of the inability to drive the top line to get that margin expansion?

Yeah. I mean, it has to be a combination of both. So, what we've said is that, with the organic growth, we've said north of 3% because you do have physician contracts that are being renewed as well as just the fixed nature of the NICU business. And so then, as we continue to expand into anesthesia, as we know and radiology, those margins are slightly below the neonatology. And so that's what you've seen a combination of all of those things occurring.

Okay. All right. That's helpful. And then just my last one. Roger, you mentioned potential for, I guess, partnerships with regional systems and you talked about women's and children's care. And you're sort of already beyond LOI and you talked about new service lines. It sounds like a lot going on there. So, I was hoping you can just flesh that out for us in terms of where you are, what the new service lines are, does that mean you have to sort of acquire service lines or new service lines meaning what you already can deliver? So, just hoping you can just flesh it out for us? Thanks.

Yeah. Ralph, all of that growth is organic. We do expect that we'll be able to make some announcements in the next quarter. They are significant growth opportunities for us in women and children's services and includes neonatology, and it includes maternal-fetal medicine and some other pediatric subspecialties. And without going into any specifics, we do think that it's a very exciting time for us. A part of our strategy is to become the preferred partner for women and children services for our clients across the country. As we've said in the past, we have put together teams of physicians and other growth people to go out and having the one MEDNAX and having all of our geographic management being done under one individual, all of that is starting to pay off for us. And we expect to have some announcements to make along those lines within the next three to four months.

Okay. And then if I could just squeeze one more in. Just trying to still understand this. Are these partnerships or are these outsourced arrangements, do you already have business with and it's just an expansion of a contract. Just trying to get a little bit better sense of just what the opportunity is.

Yeah. Well, it's a combination of all those things. In some instances, we're being asked by our hospital partners to assume care at different facilities, not an acquisition but just a straight organic growth. In some instances, we're being asked by our hospital partners to assume the responsibility for some services that they originally started on their own and now will prefer to see us manage for them. So, it's a combination of all those things. And we'll have details, like I said, within the foreseeable future.

Okay. Thank you.

We have a question from Brian Tanquilut with Jefferies. Please go ahead.

Hey. It's Jason Plagman in for Brian. Just following up on Ralph's question, how much margin pressure would you expect if organic growth came in at the low end of your 1% to 3% guidance range? I mean, obviously, the improvement of vRad will help offset that somewhat, but I'm just trying to get a feel for how we would think about the impact if organic growth came in at the low end of your range?

I mean, it's hard to compare to the fourth quarter, because, as you know, the first quarter has other margin compression related to adjust the payroll taxes and all of that. But again, it would be hopefully better than the fourth quarter, right, all else being equal because we are expecting it to be more than the 0.7% that we saw, but it was a big component of it. I don't know exactly, but because you have to look at the other factors impacting it. But certainly, we do expect it to be favorable from what you saw in the fourth quarter.

Okay. Thanks.

A question from John Ransom with Raymond James. Please go ahead. John W. Ransom - Raymond James & Associates, Inc.: Hi. These radiology deals, just directionally how does the revenue per physician compare, and what does the margin profile look like, say, compared to anesthesiology and neonatology? Thanks.

The margins are very comparable to the anesthesia margins.

Yeah.

We expect that that will continue and in fact could improve somewhat if they elect to utilize more of the vRad services that are available to them. John W. Ransom - Raymond James & Associates, Inc.: And what about the revenue per physician?

I would say it's probably pretty comparable as well. Maybe do you want to add?

Yeah. Yeah, I mean, we have limited experience so far, John, but I agree with what Roger says. I mean, I think that it's pretty – what we've seen so far similar to anesthesia, I think there is some room for improvement given some of the things that we think we can do from a business perspective. But that's what we've seen so far. Again, limited exposure here. John W. Ransom - Raymond James & Associates, Inc.: And when do you think – I know you made some commentary about vRad staffing, but when during the year do you think you'll be fully staffed at vRad? And do you think by the third quarter, you'll be back to year-over-year growth in that business?

Well, we have seen volumes tick up. Again, they've had some change in the mix of their business, but their volumes have been positive even now. But, to answer your question more directly, I do think that by the third quarter, they expect to have fully staff these physicians that they've hired now that they're going to be fully on-boarded, but that's always changing. And so, what I want to make sure that everyone understands is that they're always looking at supply and demand, and that's why what we want them to do and what they have been doing and they've been doing it pretty successfully is to continue to on-board these physicians because the volume there is hard to perfectly match, John. It's kind of like a logistics business, if you will. But given where they're at now, we do expect that you'll see certainly a lot more favorability on the staffing by the third quarter.

Yeah. And I'd say, John, by staff I mean, we mean recruiting.

Yeah.

Not reading, right? So, as far as the recruiting is concerned, we have all the physicians recruited that we had originally predicted we would seek to have recruited by the beginning of the year. The problem or the issue is getting them on-board and getting their licenses throughout the states and their credentials within the hospitals, et cetera. But it's also an ongoing process because as the business grows, you're going to need to continue through recruit and on-board physicians. And as we add more contracts to the vRad group, it still takes eight to nine months to get these people on-boarded. And so, whatever contracts we're selling now where if we need more physicians to service those contracts it's still going to take eight months to provide the service or to add the additional people. John W. Ransom - Raymond James & Associates, Inc.: So, just to be clear, third quarter, you won't be at full productivity or just have them in the chair, or am I hearing that wrong?

No, you're hearing that wrong. I expect that by the end of the second quarter, we'll have them wheeling on the chair. John W. Ransom - Raymond James & Associates, Inc.: Okay. So, I got you. And then just lastly, I mean, the strategy to acquire radiology groups to accord to go and sync with vRad. Is that a new strategy or was that always what you were thinking about doing when you bought vRad? It seems initially you were talking about being more virtual and now you come around to the view of kind of combining the two. What change you're thinking or was that always the plan?

Well, we always said that vRad was it had to be a solution to help to one of the healthcare issues. There is no way that being able to provide 24-hour backup by all the subspecialists to the hospitals et cetera wasn't going to be attractive and that we would go and have conversations with our hospital partners about our ability to provide those services for them. But we also always said that we were going to acquire some on-the-ground radiology practices. The idea of providing this hybrid structure evolved as we sat down to talk with the on-the-ground practices and offered to them the opportunity to use some of the vRad services as well. And so, it kind of evolved from our original idea of having on-the-ground practices and having teleradiology practice at the same time, as we identified that. We could, in fact, provide our on-the-ground practices with significant competitive advantages as we brought both services together. John W. Ransom - Raymond James & Associates, Inc.: That's all from me. Thank you.

Thanks, John.

Thanks, John.

We have a question from Chad Vanacore with Stifel. Please go ahead. Chad Vanacore - Stifel, Nicolaus & Co., Inc.: Hey. Good morning all.

Morning.

Morning, Chad. Chad Vanacore - Stifel, Nicolaus & Co., Inc.: All right. Just thinking about the vRad staffing. Are you actually seeing the volumes now that that are appropriate for the staffing level that you have?

Yes. Our turnaround times are back to where they needed to be. And so we're very happy with that. Our clients are happy. We're not losing contracts. And we have a team of business development people out there, specifically for vRad that are selling and obtaining new contracts. So, what we are doing is, delaying the implementation of those contracts because we don't want to get into that same position again where we sold contract and now we're not able to meet their turnaround time demand because we don't have enough people reading x-rays. So, instead of starting their new contracts next month, we're saying we're starting the contracts in five or six months. Chad Vanacore - Stifel, Nicolaus & Co., Inc.: Okay. And then just thinking about, so fair to say revenues came in line with your revised expectations and margins in that business?

Yes. It is fair to say that.

Yes. Chad Vanacore - Stifel, Nicolaus & Co., Inc.: So back half of the year, how should we think about margins improving as you optimize that structure?

Well, I think we have to see what happens with the physician compensation there as we kind of move towards that mix of business that's more related to x-rays. And so, they're actually working on their productivity metrics for that. And so, I do think that there'll be some improvement with the business as well as just with the staffing of that because they still are paying, as I said earlier, a little bit of bonus dollars. And so, we do expect that to continue to improve throughout the year. Chad Vanacore - Stifel, Nicolaus & Co., Inc.: Okay. And then, you know, you touched on mix as well. What is the mix of read that you're doing on this business compared to where you want to be?

What do you mean reads in total or our prelims or finals or what do you, more specifically? Chad Vanacore - Stifel, Nicolaus & Co., Inc.: Prelims, finals or maybe x-rays versus something more at higher acuity and more time intensive.

So, the business has been moving more to more finals, and that means more x-rays as well. We do believe that there is an opportunity to do some higher acuity because that's basically part of the model that we like about them, they have a lot of these subspecialty trained. And I think, as Roger said, as we get some of these on-the-ground practices, there's opportunity for that as well. So that's really how we see it. Chad Vanacore - Stifel, Nicolaus & Co., Inc.: All right. And then just thinking about the neonatal volumes, weaker than expected that's probably two out of four quarters this year. And then for this year, I guess, negative same-store volumes there. Is there something systematic or is there something regional going on, anything you could point to?

No, not really. We don't see anything either from a geographic standpoint. The other two variables we look at are percentage of admissions to the neonatal intensive care unit and average length of stay, and both of those remain constant within historical limit. So, what we're seeing is, in the fewer burps and fewer burps just means fewer admissions to the NICU. We do staff our neonatal intensive care unit as such though they're going to be fully utilized, because we can't predict which hospital is going to have fewer admissions on a given day. And so, it's basically a fixed cost business, it costs X amount of dollars to put a neonatologist in the hospital around the clock. And if he sees three patients or 15 patients, the costs are exactly the same. So, of course, when the volumes are down it hurts our financials, when the volumes come up it helps the financials. Chad Vanacore - Stifel, Nicolaus & Co., Inc.: All right. And then just one last thought from me or a question. So, last quarter, you expressed enthusiasm about your pipeline LOIs under contract, but you only really closed one in the first quarter. Does it look like that the pipeline is dragging out in time to close or how should we think about that?

Well, we have closed three deals so far in the first quarter. Chad Vanacore - Stifel, Nicolaus & Co., Inc.: Okay.

And those three deals really slit from the fourth quarter and mostly as a result of the expectation that the new administration would do something about capital gains, tax rates. And so that affected our guidance for the first quarter. Obviously, if we had had those three practices on board for the full first quarter, our guidance would have been different. Now, obviously, they'll be probably – for the second quarter and so we can expect the benefit from that, and we expect that we would close more deals in this first quarter. We don't believe we're done closing deals in the first quarter. But we have, of course, three significant, I would say, deals so far in the first quarter. Chad Vanacore - Stifel, Nicolaus & Co., Inc.: All right. Thanks, Roger. I'll hop back in the queue.

All right. Thanks.

We've a question from Tejus Ujjani with Goldman Sachs. Please go ahead. Tejus Ujjani - Goldman Sachs & Co.: Hi. This is Tejus Ujjani. Thanks for taking the question. Just a follow-up on that same question about the radiology practices and acquisitions there. Can you touch, share any color on the valuation multiples that you're seeing and any trends on that front as well as on the anesthesia side?

Yeah. I don't really want. I talk a lot about that. We don't want to inform our competition of what we're paying for our practices. The anesthesia multiples, as you know, are higher than the neonatology multiples. And we haven't seen any change in the multiples required for most of those anesthesia deals. Tejus Ujjani - Goldman Sachs & Co.: Okay. And with regards to your on-site radiology practice strategy, can you give a sense of the underlying clients mix of like HOPD settings versus freestanding that your radiologists are reading for? I'm just trying to get a sense of that, I guess there's been some industry dialog around site neutral payments. I'm just wondering that if your underlying hospital clients get pressure there, is there any kind of risk for you?

Most of the practices that we're dealing with are really – although, I mean, they invariably will do some outside the hospital read. The bulk of what they're doing are in the hospital reads. And the practices that we're looking at are just providing those services in outpatient centers. They are not owners, co-owners or joint ventures with these centers. Tejus Ujjani - Goldman Sachs & Co.: Okay. And so they're only getting paid the professional component, right?

That's right. Okay. Thanks for the question. Tejus Ujjani - Goldman Sachs & Co.: Yeah.

We have a question from Gary Taylor with JPMorgan. Please go ahead.

Hey, good morning.

Good morning, Gary.

Good morning.

Had a couple questions. The first one maybe just a clarification on one comment of Vivian. You talked about, for vRad, the EBITDA contribution in the first quarter being positive. And I didn't know if you meant just that it will generate positive EBITDA in total or if you meant that year-over-year the vRad EBITDA would increase?

Year-over-year.

Okay.

Yeah.

So, that's even. I don't believe vRad was really causing issues in the first quarter of 2016, right? It seemed to be 2Q and...

Yeah. Yeah. It was all incremental.

Okay.

Yeah.

Another question is, can you help us just kind of think about conceptually, if we look at the fourth quarter where EBITDA and earnings were down. As you move into the first quarter EBITDA and earnings, EBITDA up 3% to 7%, earnings at the midpoint of your range, flat to slightly up. I know some of that is the some of the increased acquisition opportunity even though it was pretty modest in the 4Q. And you've done a few deals here in the first quarter. But I guess, it does seem to imply to me that maybe you do have better margin expectations on a same-store basis for the first quarter even at the lower end of your revenue guidance. Is that correct?

Yeah. Certainly at the mid, yeah, it's slightly better. And also what you said, Gary, the deal contribution and given that in that deal contribution we have neonatology deal. And so that impacts it too overall. And so, all those contributors.

And then last question, just for Roger. I think there is some investor perception that for a hospital-based physician, you just sit there and you wait to service the patients that show up. And so, I just thought, maybe could you talk a little bit about in neonatal and in anesthesia and radiology, what are some of the things you can do in terms of engagement with some of the referring physician groups et cetera to help drive same-store? And then the other part of that, just kind of touching on, you've got a partnership with the hospital as well. So, we're hoping and presuming that your hospital partners investing in its service lines and investing in capital and trying to grow their surgical service lines, which will benefit your anesthesia business, et cetera. So, I don't know if there's any noteworthy comments to make on that side?

Well, first of all, I'd say, it's just not totally related to that, but, and not to sound like a politician, but I'd say that we like the neonatology business. Look, neonatology multiples are very low. The margins are the best margins that we've seen. And we do expect that because of demographics, we do expect that the volumes are going to come back. I mean, volumes for neonatology have been down, births have been down for 10 years from a high of almost 4.4 million births down to 4 million. That the birth would be down 10% sequentially over a 10-year period, I would have never predicted 10 years ago. And so, because of demographics, et cetera, we do expect that those volumes are going to come back. And as I said earlier because it is a fixed cost business, once that happens you will see the benefit from that flow right straight down to the bottom line. What we do with our hospital clients are, first of all, we encourage our physicians at the hospital to expand the services that they provide at the hospital. They are our neonatologists, for example, they are in the hospital around the clock. And so, we introduce them to things like hearing screens that they can do, which help the hospital out because there is legislation that all hospitals, all babies need to have their hearing tested before they leave the hospital where they are born. As I've told you in the past, there're 4 million babies born annually in the United States, we'll screen 1 million of those babies. So, they're more productive. We started a well baby program a number of years ago, which again means that because the neonatologists are in the hospital around the clock, they're not able…

Got it. Not entirely in your hands, but you've got a role in it. So, I think I understand it. That's all I had. Thank you.

Thanks, Gary.

Thanks, Gary.

A question from Gary Lieberman with Wells Fargo. Please go ahead.

Good morning. Thanks for taking the question. Can you just remind us what relationship, if any there is, between integration trends and birth rates in the U.S.?

None that we've been able to find. We look at that 10 years ago, when we thought that maybe because of the economy there were fewer immigrants coming across our border states. And we specifically paid close attention to that, and we didn't see any kind of impact.

So there is no concern, if the current administration puts any restrictions on border crossings or whatever they might do that that would impact you guys?

We're not. Again, we didn't see any 10 years ago, and that is a big concern of ours at this point of time.

Okay. And then you mentioned the contracts with new hospitals for the radiology contracts, are you making any changes to those contracts that might alleviate some of the margin pressure at the beginning of those contracts or anything that you're doing on current contracts to try to do that?

No. I mean...

No.

No. We think that the benefit there for us is, or for them and everyone is going to come from better coverage for the patients as well as ability to cover weekends and retirements, et cetera with our teleradiology component.

Okay. Great. Thanks very much.

Thanks, Gary.

At this time, there are no further questions in queue.

Okay. If there are no further questions, let me just thank everyone for participating this morning, and we'll look forward to speaking with you next quarter. Thank you, operator.

Ladies and gentlemen, that does conclude our conference for today. Thank you for your participation, and for using AT&T Executive TeleConference. You may now disconnect.