Clover Health Announces Business Transformation Initiatives to Accelerate Path to Profitability
17 Abril 2023 - 10:00AM
Clover Health Investments, Corp. (NASDAQ: CLOV) (“Clover” or
“Clover Health” or “the company”), today announced business
transformation initiatives to accelerate the company’s path to
profitability, including an agreement to move its core plan
operations to UST HealthProof’s integrated technology platform and
additional corporate restructuring actions. These initiatives are
expected to generate net annual cost savings of approximately $30
million beginning in 2024.
“Our focus at Clover is helping physicians detect and treat
disease sooner via Clover Assistant,” said Andrew Toy, CEO of
Clover. “Our partnership with UST HealthProof will allow us to
rapidly improve the efficiency of non-strategic core MA operations
and greatly reduce our administrative costs. We’re absolutely
focused on delivering a sustainable, profitable Clover Heath to our
members and investors, and this is a huge step in that
direction.”
“This transformative partnership between UST HealthProof and
Clover Health, two tech forward companies, is expected to unlock
value by permitting each organization to focus on its core
strengths. Clover will continue to innovate with our strong
benefits, wide provider network and differentiated capabilities in
Clover Assistant and Clover Home Care. Meanwhile, UST HealthProof’s
experience working with health plans will accelerate our access to
scaled operational efficiencies and strong insurance operations,”
added Jamie Reynoso, Clover’s CEO of Medicare Advantage.
“We are committed to Clover’s long-term success and expect to
unlock significant value, and deliver real savings through
increased efficiency and operational excellence,” said Kevin Adams,
CEO of UST HealthProof.
In addition to the UST HealthProof partnership, Clover also
announced it recently conducted an independent reduction-in-force
to better align its SG&A cost structure with its revenue base.
This restructuring resulted in the elimination of approximately 10%
of Clover’s workforce. The company anticipates that it will
continue to deliver additional efficiencies in future periods via
continued focus on streamlining operations, improving its
technology platform and continuing to pursue a disciplined growth
strategy focused on its core markets.
The company expects to record a total charge of approximately $7
to $9 million in 1H2023 to implement the UST HealthProof
arrangement and the additional internal restructuring actions.
About Clover:
Clover Health (Nasdaq: CLOV) is a physician enablement company
committed to bringing access to great healthcare to everyone on
Medicare. This includes a health equity-based focus on seniors who
have historically lacked access to affordable, high-quality
healthcare. Our strategy is powered by our software platform,
Clover Assistant, which is designed to aggregate patient data from
across the healthcare ecosystem to support clinical decision-making
and improve health outcomes. We operate two distinct lines of
business: Insurance and Non-Insurance. Through our Insurance line
of business, we provide PPO and HMO Medicare Advantage plans in
several states, with a differentiated focus on our flagship
wide-network, high-choice PPO plans. Our Non-Insurance line of
business similarly aims to reduce cost-of-care while enhancing the
quality of care for patients enrolled in Original Medicare. Its
home page is www.cloverhealth.com/
About UST HealthProof:
UST HealthProof, a UST company, is on a mission to play a role
in shaping how the future of healthcare is delivered. Focused on
consumer-centric and cloud-based solutions to reduce administrative
costs, UST HealthProof administers and serves over 3 million
members across multiple lines of business including Medicare,
Medicaid, Commercial, Individual and self-funded employer groups.
Its proven core administration solutions and business
process-as-a-service (BPaaS) provide transparency and improve
operational efficiency, breaking down operational barriers to scale
and driving strategic growth. Its home page is
https://www.ust.com/en/ust-healthproof
Notice Regarding Forward-Looking
Information
Please note that this press release contains forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act
of 1934, as amended. Forward-looking statements are not guarantees
of future performance, and you are cautioned not to place undue
reliance on such statements. In some cases, you can identify
forward looking statements because they contain words such as
"may," "will," "should," "expects," "plans," "anticipates," "going
to," "can," "could," "should," "would," "intends," "target,"
"projects," "contemplates," "believes," "estimates," "predicts,"
"potential," "outlook," "forecast," "guidance," "objective,"
"plan," "seek," "grow," "target," "if," "continue," or the negative
of these words or other similar terms or expressions that concern
Clover Health's expectations, strategy, priorities, plans or
intentions. Forward-looking statements in this release include, but
are not limited to, statements regarding expectations relating to
cost savings and implementation of the business transformation
initiatives, as well as the statements contained in the quotations
of our executive officers, including expectations related to Clover
Health's liquidity, future performance and profitability, future
operations and future results. These statements are subject to
known and unknown risks, uncertainties and other factors that may
cause our actual results, levels of activity, performance or
achievements to differ materially from results expressed or implied
in this press release. Additional information concerning these and
other risk factors is contained in Clover Health’s latest Annual
Report on Form 10-K filed with the Securities and Exchange
Commission (the “SEC”) on March 1, 2023, including the Risk Factors
section therein, and in its other filings with the SEC. The
forward-looking statements included in this press release are made
as of the date hereof. Except as required by law, Clover Health
undertakes no obligation to update any of these forward-looking
statements after the date of this press release or to conform these
statements to actual results or revised expectations.
Press Contact:Andrew
Still-Baxterpress@cloverhealth.com
Investor Relations Contact:Ryan
Schmidtinvestors@cloverhealth.com
Clover Health Investments (NASDAQ:CLOV)
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