Dive Brief:
- Clover plans to offer Medicare Advantage plans in 13 new counties across Georgia, South Carolina and Tennessee next year as the insurtech, facing rising expenses, zeroes in on growth markets.
- The Tennesse-based company will also exit two smaller markets in El Paso, Texas, and Pima, Arizona.
- Currently, Clover offers MA plans in 209 counties, covering roughly 85,000 members. The addition will bring the insurtech’s footprint to 220 counties across eight states in 2023.
Dive Insight:
If approved by federal regulators, Clover’s MA plans will be available to individuals eligible for Medicare in the new counties for coverage starting January 2023.
Clover, like many insurtechs, is focusing on rapidly increasing its membership in the lucrative MA program, often at the expense of its larger health insurance peers. In 2022, Clover almost tripled its membership in Georgia by increasing its provider network, adding dozens of hospitals and physicians.
And the company is doubling down: In 2023, Clover wants its plans to be available to eligible individuals in 151 of the 159 counties in Georgia, which together contain a market opportunity of nearly 650,000 Medicare eligibles, the company said.
Clover is targeting markets with fragmented health systems and a high percentage of underserved seniors, while avoiding markets currently dominated by narrow networks or delegated models, a company spokesperson told Healthcare Dive.
“We’re focusing our efforts on our existing footprint where we have a proven track record,” Clover President Andrew Toy said in a statement on the expansion.
Clover is looking to deepen its presence in more successful markets as the insurer faces regional challenges from COVID-19 and costs. New Jersey got hit harder from a hospitalization perspective during some of the COVID-19 spikes, management has said. Southern New Jersey had an MLR of more than 120% in the first quarter, compared to an MLR of 99.3% in northern New Jersey and 99.9% in Georgia. Clover’s MLR was 103.8% across its other markets.
Clover, which plans to be more aggressive on its MLR improvement efforts, does think there’s opportunities for newer markets like Georgia to look more like its mature markets over time as well, Toy told investors on a first-quarter earnings call in May.
Clover’s revenue increased fourfold year over year in the first quarter to $874.4 million. But, amid rising costs, Clover saw a more than threefold increase in its operating expenses to about $962 million, from $319 million in the first quarter last year.
Its net loss widened 56% to $75 million.
