Bright Health Group is trying to sell its California Medicare Advantage business, a move that would effectively end all of the company's insurance business.
In an April 28 news release, the company said it is "exploring strategic alternatives" for its California Medicare Advantage offerings "with a focus on a potential sale."
In the news release, Manny Kadre, lead independent director of Bright Health, said the company has received "inbound interest" in purchasing its Medicare Advantage business.
"Bright Health’s California Medicare Advantage business is strong and uniquely positioned to deliver culturally competent, localized care to nearly 125,000 aging and underserved consumers in California. Throughout this process, we are committed to enhancing value for all stakeholders and remaining true to Bright Health’s mission of making healthcare right, together," Mr. Kadre said.
A potential sale is not final, the company said.
Bright Health exited its Medicare Advantage business outside of California at the end of 2022. The company also exited ACA exchanges nationwide.
The company ended 2022 with 1 million commercial members, 125,000 Medicare Advantage members and 530,000 value-based care consumers, according to its fourth-quarter 2022 earnings report.
Bright Health Group is shifting from insurance to its consumer care delivery business, according to the news release.
The company served around 375,000 value-based care delivery consumers in the first quarter of 2023, exceeding growth expectations, according to the release.
The company has faced a string of financial challenges in recent months. In its fourth-quarter earnings release, the company said there was "substantial doubt" about Bright Health Group's ability to keep operating. The company breached its minimum liquidity requirements in the first quarter of 2023.
In the news release, Bright Health Group said it has extended a waiver to keep its credit facility through June 30.
The company is also seeking a reverse-stock split to avoid being delisted from the New York Stock Exchange.
Bright Health Group, founded in 2016, has never turned a profit. The company posted a net loss of $668.6 million in the fourth quarter of 2022.
The company will report its first-quarter 2023 results May 9.