Medicare Advantage insurtech Clover Health has delivered notice to the Centers for Medicare and Medicaid Services that it will be exiting the ACO REACH Program at the end of the 2023 performance year.
The Accountable Care Organization Realizing Equity, Access, and Community Health (ACO REACH) program provides tools and resources to healthcare providers to improve the quality of care for individuals with traditional Medicare.
Clover entered the program as it felt it would garner benefits, like expanding the number of physicians it worked with or lives it touched via its Clover Assistant management platform, a tool that combines health data with machine learning to provide physicians with patient insights at the point of care.
“While we were successful in those goals, we have not seen a clear line to profitability in this business, and it has also become quite clear that, over the same period of time, we have made far greater and swifter strides on our path to profitability in our Medicare Advantage insurance business,” insurtech said.
Clover Health has had a tumultuous year financially. After going public in 2021 through a SPAC with Social Capital Hedosophia Holdings III, the Tennessee-based company’s valuation climbed to around $3.7 bn.
A month after finalizing its merger, Clover came under fire from Hindenburg Research, a short seller that describes itself as a specialist in forensic financial research.
Hindenburg published a report alleging Clover failed to disclose active investigations by the Department of Justice during its SPAC. It argued many of the company’s claims were misleading or outright false.
Clover announced it settled a securities class action in which the class would receive $22 mn, $19.5 mn of which the company’s insurance would pay, and the remaining $2.5 mn out-of-pocket.
In June, Clover Health relayed it reached an agreement to settle seven lawsuits in Delaware, New York and Tennessee pertaining to allegations the company did not disclose it was under active investigation by the Department of Justice when it went public.
by Peter Sonner