JPM24, Day 3: Alignment Healthcare praises star rating changes

It's officially a new year for the healthcare industry, as biopharma executives, investors, reporters and others make the annual trek to the Westin St. Francis in San Francisco for the J.P. Morgan Healthcare Conference.

We have you covered with the biggest headlines from Wednesday here, as well as across the site. And to keep up with the Fierce Biotech team, click here, or for updates from Fierce Pharma, click here.

Follow the Fierce team's coverage of the 2024 J.P. Morgan Healthcare Conference here

UPDATED Wednesday, Jan 10 at 7:13 p.m.

Alignment Healthcare talks star ratings

Alignment Healthcare CEO John Kao took time during his presentation to show off the company's recent star ratings successes.

He said that 90% of members in North Carolina and Nevada are in 4.5 star plans, and Alignment is one of two public companies in California with four star plans going into next year. Only 56% of people enrolled in Medicare Advantage will be in four star or higher plans by 2025.

Recent changes to the star ratings program by CMS seem to not be negatively affecting the insurtech like other payers. Earlier this month, Elevance Health filed a lawsuit over the changes, picking out implementation of the Tukey outlier deletion method as one of its top complaints. Elevance is expecting a $500 million hit to its bonus payments.

Kao alluded to these star ratings criticisms in his remarks with little sympathy.

"This was not a surprise," he said. "Some people didn't take Tukey seriously. We did. CMS gave everybody ample warning for it. We like it, what they're doing with stars, because it's normalizing the playing field." - Noah Tong

UPDATED: Wednesday, Jan. 10 at 5:30 p.m.

Headspace unveils all-in-one mental health service

Digital mental health company Headspace rolled out an all-in-one mental health offering and expanded its employee assistance (EAP) replacement solution.

The integrated app is accessible to more than 200,000 people within enterprise partnerships that include some of the biggest companies in the country and select health plan and navigation partners. 

Headspace's mindfulness and meditation content will be accessible in the same app as its clinical care services such as coaching, therapy and psychiatry and its EAP replacement experience which includes therapy sessions, critical incident support, work-life services, global services and management service. 

For Headspace's employer clients, their workforce will now have a single destination for end-to-end mental health support, including evidence-based mental health and mindfulness content, 1:1 mental health coaching, therapy and psychiatry, as well as work-life services. Headspace has also begun to roll out this offering to select health plan and navigation partners, including Accolade, Quantum Health and Virgin Pulse.

Over the coming quarters, this comprehensive system of mental healthcare will be made available to Headspace consumer members as well, the company said Wednesday.

Headspace, which merged with Ginger in a $3 billion deal in the fall of 2021, offers meditation and mindfulness services along with on-demand coaching, therapy and psychiatry services. The company now works with more than 4,000 employers across 200 countries and also works with an ecosystem of health plans and partners.

A year ago, Headspace rolled out a new, unified product experience that brings together meditation and mindfulness services with Ginger's on-demand coaching, therapy and psychiatry services. That also included an expanded EAP (employee assistance program) offering.

Headspace EAP is now available globally. EAP members can utilize the newly launched Headspace Hub to view available services and identify the support they need. Members can request an in-person provider, get support in finding local work-life services or help finding care for children ages six and older, according to the company.

“Mental healthcare is long overdue for a solution that makes end-to-end, lifelong support a reality for all,” said Russell Glass, CEO of Headspace. “Our new, fully integrated app experience allows us to deliver on this promise for employers and employees, creating a singular destination for evidence-based mental health and mindfulness content, mental health coaching, therapy, psychiatry and work-life services – all seamlessly accessible through one app.” - Heather Landi

UPDATED: Wednesday, Jan. 10 at 3:03 p.m.

Oscar Health CEO sees ACA as 'here to stay'

Amid speculation that the Republicans could once again move to kill the Affordable Care Act (ACA) if given the opportunity, Oscar Health CEO Mark Bertolini believes repealing the legislation will be extremely difficult to pull off.

As member enrollment increases, its inevitability is more likely and the program is getting close to being "too big to kill," he said. Today, Centers for Medicare & Medicaid Services (CMS) announced that more than 20 million members are enrolled in the ACA. In October, Oscar Health said that it would be expanding into 165 new counties on ACA exchanges in 2024.

"When you hear that the state of Texas is considering building their own health care exchange, that's a sign that the Republican resistance around that's going to go away," he said. 

When asked how the outcome of the 2024 presidential election may affect policy, Bertolini predicts it will be a mess "as long as it's a divided government." - Noah Tong

UPDATED: Wednesday, Jan. 10 at 1 p.m.

GoodRx offers preliminary look at its 2023 finances

Prescription discount company GoodRx said Wednesday that it expects to bring in between $749 million and $751 million in revenue for 2023, according to early data released ahead of its session at the J.P. Morgan Healthcare Conference.

For the fourth quarter, the company projects between $195 million and $197 million, in revenue.

It also said that it believes full year earnings before interest, taxes, depreciation and amortization (EBITDA) margins will be in the upper range of its guidance, thanks in part to the increased revenue.

GoodRx's Interim CEO Scott Wagner said during the conference session that there were several key elements behind the improved performance. For one, the comapny saw higher volume, driven by a rise in seasonal illness requiring prescriptions. He said there was also higher volume as a result of its direct contracting program with certain retailers.

He acknowledged that a rocky financial outlook is likely what brought him to the CEO role in April 2023, but said the company has worked hard to grow from that.

"The things that we're working on reinforce the value proposition," Wagner said. — Paige Minemyer