Alignment Healthcare Posts Loss As Insurer Expands Medicare Advantage Into New Markets

Alignment Healthcare, a startup provider of Medicare Advantage insurance, reported a loss of $40.2 million in the third quarter. That’s because startup providers of Medicare Advantage insurance are spending money to expand their coverage into new markets and add more subscribers.

Alignment, which is selling its privatized Medicare Advantage plans into new markets for 2023, made $40.2 million a share on Thursday, compared with $45.8 million, or 26 cents a share, in the same period last year. 22 cents per unit). Meanwhile, total income increased nearly 23% to $360.3 million from $293.5 million in the same period last year as health insurance enrollment continues to grow. At the end of the quarter, health insurance enrollment was 98,000, up 14% year-over-year.

“Alignment Healthcare’s strong performance in the third quarter is a testament to the repeatability and scalability of our operating model,” said John Kao, founder and CEO of Alignment. “This quarter demonstrates how our strategic long-term investments in people and technology can effectively deliver lasting financial results across the markets we serve.”

Expect losses for startups like Alignment, especially in the highly competitive Medicare Advantage business. Health insurance spends money building networks of providers and associated infrastructure and expanding into new markets.

Medicare Advantage Plans, owned by health insurance giants such as UnitedHealth Group, CVS Health’s Aetna, Humana, and Elevance Health, contract with the federal government to provide benefits to older people, such as disease management and nurse assistance. We provide additional benefits and services to There is also a hotline that offers vision, dental care and wellness programs. And in recent years, the Centers for Medicare & Medicaid Services has helped Medicare Advantage plans cover more supplemental benefits, increased their popularity among seniors, and invested and capitalized in a range of companies, including start-ups like Alignment. is attracting

Earlier this year, Alignment announced plans to expand into two new markets in 2023, launching Medicare Advantage in Florida and Texas.

Alignment, a popular and competitive Medicare Advantage business that went public last year, announced in June that expansion into Florida and Texas would include “additional counties within the four states where it currently operates.” He said it would also include the launch of the plan. Alignment already sells Medicare Advantage in four states: Arizona, California, Nevada and North Carolina.