Medicare Advantage (MA) insurers Alignment Healthcare and Clover Health both reported increased membership growth ahead of the J.P. Morgan Healthcare Conference this week.
Leaders at the companies took an aspirational approach to building and growing a robust challenge to industry giants.
Alignment’s membership has increased to 209,900 members, a 35% year-over-year increase from the beginning of 2024 and far surpassing full-year expectations. In November, the company said its membership was just 182,300 while reporting a quarterly net loss of $26 million.
“Heading into 2025, I’m even more optimistic,” said Alignment CEO John Kao during a presentation in San Francisco. “And I think a takeaway is the runway in 2025, 2026, 2027 is very, very strong.”
The insurer now expects to hit 231,000 members by the end of this year. It also aims to reach an adjusted EBITDA of $40 million in 2025, but further guidance will be offered during an upcoming fourth-quarter earnings update.
In some markets in California, Alignment has more than 10,000 members. Once the company is cash flow positive, Kao will push the company to scale further in Nevada, North Carolina and Arizona. By 2027, Alignment will begin operating in new states.
“We’re going to use that to fund our growth, and we’re going to fund it ourselves,” said Kao. “That’s how we’re going to take over the world. This is the blueprint of how you fix MA.”
Clover referred back to its 2024 goals from one year ago, saying the company met its star ratings objectives and introduced Counterpart Health, a software-as-a-service product, to the market. The company hopes to introduce Counterpart in geographies where a Clover plan is not offered. The insurer is now gearing up for growth, an 8-K filing shows.
The company is experiencing similar growth, recording a 27% year-over-year increase following annual enrollment. Clover has more than 100,000 members, with 95% of them in a four-star plan or better. Clover also expanded its home care footprint in Georgia and reached adjusted EBITDA profitability.
“That’s a significant achievement,” said Clover CEO Andrew Toy in his JPM presentation, noting the company did not have to raise capital. He emphasized that Clover does not do value-based contracting—instead paying physicians more appropriately for their time—and its tools can be used without integration into an electronic health record.
Many of its members are switching from other MA plans, and two-thirds of growth is in the New Jersey markets. It expect its future market share in New Jersey to rise as the MA market grows and the popularity of PPO plans increase. Clover is expecting to maintain adjusted EBITDA profitability in 2025.
Toy also highlighted how Clover's PPO plan ranks No. 1 in the country in HEDIS clinical quality scores compared to similarly sized plans. Its HMO plan is ranked No. 2.
"That is driven by the fact that we can give our technology to almost any physician," he explained. Toy also hinted the company would improve Clover Assistant through the use of new large language models.
Alignment and Clover were the only two insurers present at the event. Cigna, Centene, Oscar Health and Molina Healthcare all dropped out of attendance following the killing of former UnitedHealthcare CEO Brian Thompson.
Alignment promoted Dawn Maroney to president, where she will manage operations and improve provider engagement, among other priorities. Kao pointed to the company’s mission of bettering care for seniors, supporting doctors and “having a serving heart” as a prerequisite for working at Alignment.
“How many others out there have these same principles?” he asked. “My hope is more and more of the industry adopts these principles.”
The company identifies polychronic individuals that need more care and engages them. Engagement with these individuals is around 60%, which bends the cost curve, said Kao, but the goal is to increase engagement to 80%. Alignment employs 400 clinicians to serve this 10% to 20% of the population. This leads to higher rebates and a more robust product offering.