Large-ish Health Insurance Startups
So, I wrote about the biggest health insurance companies, now I’m going to do a quick run down of some of the start ups in this space.
A lot of the buzz focuses around Bright, Clover and Oscar, which attracted lots of funding but which have all had trouble finding their niche in a world dominated by some extremely large players. Recently they all seem to be experimenting with what kinds of plans they should should cover and what their relationships with care delivery should be.
Bright Health
Founded in 2016 by Bob Sheehy, a former CEO of UHC, Bright Health focuses on Medicare Advantage plans in a few key states. Despite a very experienced team, with veterans from UHC and Target, Bright hasn’t really taken off yet. In 2022, they announce they were pulling out of six states where they weren’t getting much revenue traction.
As with all the companies here, Bright Health turned to technology to try to differentiate themselves and offer a user interface to patients, an analytics layer and a backend that integrates with EHR systems.
Financials:
Revenue: US$2.41b (up 59% from 2021).
Net loss: US$773.3m (loss widened by 135% from FY 2021).
Clover Health
Vivek Garipalli and Kris Gale co-founded Clover Health in 2014. Garipalli previously founded and operated a hospital chain in New Jersey called CarePoint Health. Like Bright, Clover focuses on the Medicare Advantage market.
In 2019, Clover Health launched Clover Therapeutics, a company that uses data collected from Clover's plan members to research and develop therapies for chronic diseases related to age.
Clover has had a couple regulatory issues, having been fined in 2016 for misleading customers about where they could receive care, and being investigated by the DOJ for not disclosing all required information before going public.
They also have had an interesting time in the public markets, having been taken public during the SPAC fad by Chamath Palihapitiya, and then becoming a meme-stock in 2021, before the price fell back down to earth.
Financials
2022 Revenue: $3.5 billion in 2022, up from $1.5 billion in 2021
2022 Loss: $338.8 million down from the $587.8 million loss for 2021.
Oscar Health
Oscar was founded in 2012 by Joshua Kushner (yes of those Kushners), Kevin Nazemi and Mario Schlosser and headquarted in New York City. Oscar seeks to bring technology and user-focused design to insurance to make it friendlier and easier to use for consumers. It focuses largely on the America Cares Act exchange space and small employers in several states, sometimes partnering with other insurance companies, notably Humana and Cigna.
In my circles, Oscar has gotten the most buzz. There are ads all over New York City, there are a lot of Google Alum working there, and there is a lot of cross-polination from Bridgewater, thus attracting attention from the finance people in New York.
They seem to be trying a lot of things to see what sticks. They have partnerships with other insurance companies, and also big brand hospitals like Mount Sinai and Cleveland Clinic.
Financials:
2022 Revenue: $3.96 billion (up from $1.8 billion in 2021)
2022 Loss: $609.6 million (up from $571.2 million loss in 2021)
Sources
https://en.wikipedia.org/wiki/Bright_Health
https://en.wikipedia.org/wiki/Clover_Health
https://simplywall.st/stocks/us/insurance/nyse-bhg/bright-health-group/news/bright-health-group-full-year-2022-earnings-misses-expectati
https://www.fiercehealthcare.com/payers/clover-health-slims-losses-q4-it-puts-focus-profitability#:~:text=For%20the%20full%20year%202022,for%20the%20full%20year%202022.
https://www.fiercehealthcare.com/payers/oscar-health-execs-remain-confident-path-profitability-even-losses-swell-2022
https://en.wikipedia.org/wiki/Oscar_Health
https://www.cloverhealth.com/en/
https://www.hioscar.com/
https://brighthealthcare.com/