Ritter Insurance Marketing, Craig Ritter

Clover Health Raises $100M with Revolutionary Approach to Health Insurance

As the 2016 Annual Enrollment Period approaches, one thing is clear: investors are already banking on Clover Health having a successful selling season. Clover Health, based in San Francisco, is a digital health insurance startup offering a Medicare Advantage government-subsidized plan in nine counties throughout New Jersey. Formerly known as CarePoint Health Plan, the company has already raised $100 million in an equity round and debt financing.

First Round Capital is one of the top investors contributing to the health insurer’s equity round. The venture business, which has provided capital to seed-stage companies such as Uber, shelled out $4 million—an amount that’s seven to eight times their average investment—for Clover Health.

So, why are investors so intrigued about Clover Health?

Foremost, Clover Health has decided to uses a data-driven approach to offering health insurance. Using innovative technology and software, the company plans to sort through, and integrate, all of the data available from the insurance claims and lab test results they receive from their beneficiaries.

They plan to use the data to track beneficiaries’ medical histories, identify gaps in their care, and intervene with their best care in mind. To help with such interventions, Clover Health has nurse practitioners and social workers on staff. Overall, the company aims to reduce the number of times their clients have to go to the hospital, and thereby, cut costs for all parties involved.

Investors seem to be pleased with Clover Health’s distinctive approach. None of the large insurance providers currently dominating the market are taking advantage of the data available to them. Clover Health has the potential power to revolutionize the world of health insurance, and investors have figured that out.

So far, the company seems like it might prove to be a worthy investment. An article on bizjournals.com reports that, “In the first half of 2015, Clover members had nearly 50 percent fewer hospital admissions and 34 percent fewer hospital readmissions than the average Medicare patient in the New Jersey counties the (insurer) serves.” However, it’s too early make any sound judgments.

Time will tell if Clover Health’s approach pays off. As I previously posted, Oscar Health Insurance, another startup company that has strong backing by investors, including a $32 million investment by Google, has been somewhat slow to gain customers.

Posted by filed under Clover Health, Medicare Advantage, New Jersey, News, Uncategorized .

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