Florida is supervising Bright Health's finances

Florida has been supervising Bright Health's operations in the state since last fall and plans to continue until at least May 1.

Under a supervision order extension filed March 1 by Florida's insurance office, Minneapolis-based Bright is not allowed to spend more than $10,000 on anything without the state's approval and it has to pay for an on-site state employee to monitor its finances – and provide them an office.

The supervisor is allowed "complete and unrestricted" access to the insurtech's financial records, bank accounts, and physical assets.

The regulations come after a period of extreme operational challenges for Bright over the last year. In 2022, the company reported a net loss of $1.4 billion and ended most of its insurance business by exiting the ACA market and Medicare Advantage outside of California.  

Bright Health has also initiated several rounds of layoffs in the past year, laying off at least 300 employees since March 2022. 

In its fourth quarter earnings report published March 1, Bright said it had "substantial doubt" around the company's ability to continue operating as a "going concern" within the next 15 days. The company breached its minimum liquidity requirement in the first quarter of 2023.

CEO Mike Mikan told investors on an earnings call the company needs to raise around $300 million to stay afloat after the business overdrafted its credit.

In August 2022, Bright told Florida regulators there was "substantial doubt" the company could remain financially viable without additional outside investment.

Florida placed the company under its supervision on Sept. 2, which includes a ban on any pay increase or bonuses for executives without permission. All employees at every level must cooperate with the state and all nonroutine activities must be approved first. 

The state can also act on Bright's behalf to "amend affiliated agreements." While the company is not barred from entering into potential business or financial proposals, the state must provide consent before any employee enters an agreement.

Bright ended 2022 with 1 million commercial members, 125,000 Medicare Advantage members and 530,000 value-based care consumers. 

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