Dive Brief:
- Struggling Bright Health is rebranding to NeueHealth as it shifts its offerings from insurance toward care management, effective Jan. 29.
- The business will consist of two segments, wraparound care management focused NeueCare and provider-enablement support-centered NeueSolutions, according to a Wednesday press release.
- NeueHealth will also move its headquarters from Minneapolis to Doral, Florida, where the company operates a network of clinics that serves more than 150,000 consumers. No jobs will be impacted by the move, according to the release.
Dive Insight:
Bright Health went public in 2021, raising more than a billion in venture funding in the run-up to its public debut amid investor enthusiasm for healthcare tech companies. However, the company began to report financial troubles almost immediately.
In 2022, the company was threatened with delisting from the New York Stock Exchange after its share price dropped to less than $1 a share for over 30 consecutive days. In March of last year, Bright violated agreements with lenders, including J.P. Morgan, by spending $350 million available in its credit facility.
Bright sought to shed insurance products and other assets to stay afloat, exiting the ACA exchange and leaving states where it offered Medicare Advantage plans.
This month, the company completed the sale of its California Medicare Advantage business, Brand New Day and Central Health Plan, to Molina for about $500 million, according to regulatory filings. The possible deal was first announced in June.
As part of the sale, the company made a final repayment to J.P. Morgan, eliminating its secured debt, according to the press release.
The remaining proceeds from the sale are anticipated to help the newly branded NeueHealth achieve profitability on an adjusted EBITDA basis in 2024, according to Mike Mikan, president and CEO of Bright Health.
NeueCare provides wraparound care management for consumers across the ACA marketplace, Medicare, and Medicaid. In third-quarter earnings reports last year, the company forecast that care delivery services reached between 275,000 to 295,000 consumers during 2023 and delivered revenue of between $250 and $275 million.
NeueSolutions offers provider enablement support for independent providers and medical groups, such as customized population health tools and participation in the Centers for Medicare and Medicaid Innovation’s ACO Realizing Equity, Access, and Community Health (REACH) program. In the third quarter of 2023, the company forecast care solutions generated at least $890 million in revenue for the year and reached approximately 60,000 REACH ACO consumers.
