In advance of the 2021 Medicare Annual Election Period (AEP) that starts on Oct. 15, venture-backed Medicare Advantage firms like Alignment Healthcare and Clover Health are unveiling their plans for expansion while new startup insurers are declaring their intentions. Although the collective membership of startups is a drop in the bucket compared to the five major insurers that dominate two-thirds of the MA market, one expert says their focus on technology positions them for enrollment success during the COVID-19 pandemic, as long as they can follow through on the clinical side.
Given the increasing share of Medicare beneficiaries who select MA over fee-for-service Medicare, the maturity of the program, and the aging baby boomer population, “organizations are comfortable with both the costs and the revenue streams associated with [MA] and are building infrastructures from the ground up to be able to be successful,” observes Jason Montrie, president of Pareto Intelligence, a Convey Health Solutions company. “And I think we’re seeing there’s a lot of available capital. [Startups] are looking in new markets…where they think they can be successful, they can acquire new investors, and they can grow in a market that has a lot of tailwinds.”