Clover Health CEO Andrew Toy told investors Nov. 7 that the company is reducing its participation in CMS' ACO Reach model by two-thirds.
"We still expect this business line to have a scale of approximately $1 billion of annual revenue," Mr. Toy said. "And importantly, we very much believe these adjustments will result in a sustainable business line with an MCR below 100 percent."
The model is an alternative payment system for Medicare members and is the first from CMS that prioritizes health equity plans and strategies. Clover has been a part of the model since 2021 and manages the care of over 166,000 members, according to the company's third quarter earnings report. In 2022, the model generated $1.8 billion in revenue for Clover, including $814 million from Medicare Advantage members.
"Rules can still change, rates are being tweaked, the model is being adjusted, and we still intend to be one of the larger participants in that program," Mr. Toy said. "But we're very excited to extend fee-for-service into other areas too."
He said the company is looking at alternative programs, such as the Medicare shared savings program.