in a round led by Andreessen Horowitz ahead of launching its first Medicare Advantage plans in Florida in 2019. Bright Health, a Minneapolis startup that provides individual and Medicare Advantage plans, in November raised $200 million as it expands into more US markets. AndBusiness Insider looked through regulatory filings to get a sense of how the startups — particularly Oscar, Clover, and Bright — performed in 2018.
About a third of people on Medicare are enrolled in private Medicare Advantage health plans. People can typically choose to enroll in Traditional Medicare or Medicare Advantage plans when they turn 65. Either way, their health needs are largely funded by the US government. Medicare Advantage works much like private insurance does for those under 65. It's designed to allow people to shop around and choose from different plans, which may restrict which doctors and hospitals they can use. The US government, in turn, pays the insurers a certain amount for each person covered, creating an incentive for the insurer to try to keep that person healthy and out of the hospital.
"Medicare Advantage is today the simplest way to align financial incentives across the various parties in the system," Bryan Roberts, a Venrock partner who's a Devoted investor and board member,."Therefore, you can drive better efficiency in the healthcare system." Oscar got its start offering plans on the individual exchanges set up under the Affordable Care Act. It's offered plans to individuals as well as small employers. Bright in 2017 also got its start offering individual plans. As of 2017, there were about 15.2 million members enrolled through the individual market, according
They are doing this to make a profit. It will create chaos. Healthcare has to have some uniformity to be effective and successful. Investors have expectations. Destined to fail because how will they catch up? Oscar lost $200m in 2018.