Even as the number of Medicare enrollees increases, coordinated care remains in the red

Alignment Healthcare said Tuesday that the startup, which offers Medicare Advantage insurance for seniors, posted a third-quarter net loss of $26.4 million, even as the number of health plan enrollees grew nearly 58%. It was reported that there is.

Alignment had 182,300 members in the third quarter, an increase of 57.7% year over year. This led to a nearly 62% increase in total revenue for the quarter to $692.4 million.

But like its larger rivals in the Medicare Advantage business, Alignment's medical costs skyrocketed with enrollment. Medical expenses increased by $613 million in the third quarter, compared to just $397 million in the same period last year.

Medicare Advantage plans have struggled this year as older adults seek care and file claims with health insurance companies amid pent-up demand for medical services in the wake of the coronavirus pandemic. Already, UnitedHealth Group's UnitedHealthcare health insurance business and CVS Health's Aetna have disclosed third-quarter results in which medical costs in their Medicare Advantage businesses exceeded expectations.

Medicare Advantage is a contract with the federal government that provides older adults with additional benefits and services, such as disease management, a nurse helpline, and, in some cases, vision and dental care, in addition to the traditional coverage available in traditional Medicare. We also offer treatment and wellness programs.

In Alignment's case, rising medical costs once again prevented it from turning a profit for the first time since its founding in 2013, with the company posting a loss of $26.4 million ($1.4 per share), compared to a loss of $35 million in the third quarter. cents). That was 19 cents per share in the year-ago period.

Alignment, which went public on the Nasdaq in 2021, doesn't predict exactly when the company will become profitable, but a company spokesperson said executives are “focused on profitability in 2025.” said.

Still, Alignment's CEO said the company has what it takes to “succeed in Medicare Advantage in the future.”

“Alignment Healthcare's strong performance once again highlights our differentiated ability to generate strong financial results by focusing on our member-first philosophy,” Kao said in a statement. “Given all the changes happening in Medicare Advantage, we believe our population health approach will set the standard for what it takes to be successful in Medicare Advantage in the future. Masu.”