More than just health insurance: Medicare Advantage startup aims to boost care coordination

A startup company focused on Medicare Advantage aims to increase communication between patients' various providers. Image: Getty/wmiami

After seeing firsthand how poor care coordination can endanger patients’ health—and challenge their caregivers—one man decided to do something about it.

That man is John Kao, now the CEO of a startup called Alignment Healthcare, which provides health insurance plans and services for Medicare Advantage customers, according to an article from Business Insider. Kao’s company takes the idea of a patient-centered medical home, which has already taken off in primary care, and applies it toward building a health plan that aims to coordinate the care patients get in the hospital to their post-discharge care.

For Kao, that means helping patients avoid the situation he faced when caring for his mother after she had a heart attack. Kao was struck by the fact that the hospital that treated her didn’t communicate with his mother’s other doctors, he told Business Insider.

To fix that problem, if a patient sees an Alignment-affiliated doctor in the hospital, he or she then acts as that patient’s concierge by coordinating inpatient and post-discharge care among all that patient’s providers. The company also uses data it collects on individuals to flag individuals who potentially need medical intervention.

Alignment’s business model varies in different states; for example, it offers its own Medicare Advantage health plan in California, while in North Carolina it serves as a third-party resource for the MA plan FirstCarolinaCare. Kao told the publication he thinks Alignment, which has already reported $500 million in revenue, can disrupt the health insurance business from the inside out.

Yet it faces steep challenges. At least one other insurer targeting the Medicare Advantage space, Clover Health, has struggled to turn a profit, as a recent Axios article noted. There is still a good business case for trying to enter the market, however, as enrollment in Medicare Advantage plans has risen considerably in the last five years.