Bright Health reduced its revenue guidance for the year as the soon-to-be former health insurer advances the sale of its final insurance asset, the company reported Wednesday.
The company downgraded its annual revenue guidance from $2.9 billion-$3.1 billion to $1.15 billion-$1.2 billion. Bright Health narrowed its net loss 56% to $125 million, or $15.70 per share, as revenue nearly doubled to $298 million.
In the meantime, Bright Health holds enough cash to survive until it completes a deal to sell its California Medicare Advantage plans to Molina Healthcare, CEO Mike Mikan said during a call with investment analysts. The company will achieve profitability on an adjusted basis this year, he said. Absent the insurance operations it already halted and the Medicare Advantage assets it intends to offload, Bright Health operates a network of NeueHealth primary care clinics in Florida and Texas.
“Our experience integrating health insurer functions into care delivery, including claims management and member enrollment, has allowed us to build a unique model in value-driven care,” Mikan said. “We have great growth potential.”
Bright Health shares opened at $16.06 on the New York Stock Exchange Wednesday, down 8.6% from Tuesday's closing price. The company executed a reverse stock split in May to raise its shares above the $1 minimum required to remain on the exchange.
Bright Health holds $108.2 million at its parent company and $2.2 billion in its regulated insurance arms, Chief Financial Officer Jay Matushak said. The company has borrowed $303.9 million of its $350 million credit facility, and has $30.7 million in undrawn letters of credit to support its participation in the Medicare Accountable Care Organization Realizing Equity, Access and Community Health program. NeueHealth manages care for 65,000 ACO REACH enrollees.
The company announced it entered into a permanent waiver of default on its $350 million credit facility Monday.
"We believe all the steps we've taken since the end of Q1 position the company for long-term capital efficient growth," Matushak said.
Bright Health is 95% complete processing provider claims associated with its former commercial business, he said. The company’s risk-adjustment costs related to its previous exchange plans were consistent with expectations, Matushak said.
Bright Health will no longer separately report its California Medicare Advantage plans’ performance in financial filings as it works to finalize a sale to Molina Healthcare in early 2024. The company reported liabilities related to its discontinued operations of $2.6 billion, down 18.1% from $3.2 billion this time last year.