The first of several payer lookbacks highlights some of the year’s biggest moves.
Anthem becomes Elevance, highlighting multiple payer efforts to become something else.
In March 2022, Anthem announced it would change its name to Elevance Health to reflect its commitment “to elevating whole health and advancing health beyond healthcare.” At the company’s annual meeting in May, shareholders approved the rebrand, which did not affect the Anthem Blue Cross Blue Shield health plan name.
In the health plan ecosystem, what’s in a name is increasingly not just “health plan.”
As HealthLeaders noted upon Anthem’s announcement, Anthem’s portfolio has expanded over the years to offer more than just health insurance. Between pharmacy, behavioral, clinical, and complex care assets, along with its digital capabilities, the payer offers consumers a wide range of services.
As part of the new branding, Elevance president and CEO Gail Boudreaux stated: “Improving health means more than just treating what ails us … This need has driven our transformation from a health benefits organization to a lifetime, trusted health partner.”
Elevance isn’t the only health plan seeking transformation. Think of it as healthcare’s version of the Impossible Burger, the use of alternative ingredients to deliver an established product. The payer advocacy group America’s Health Insurance Plans (AHIP) changed its name in June 2021, with the P in AHIP now designating provider versus plan to mark insurers’ broader purpose.
In a release for the rebrand, AHIP CEO Matt Eyles noted: “We are champions of care, guiding greater health. That’s our mission and it is central to the work that health insurance providers do every day … we’re not just changing how we describe our work, but how people think about the role of health insurance providers in their lives, from making coverage and care more affordable to breaking down barriers to good health.”
Pairing new names with existing challenges is also reflected in the distinct branding many payers assign to their health services divisions. Think UnitedHealth Group’s Optum, Cigna’s Evernorth, and most recently Humana’s CenterWell.
Humana restructures for value while health plan startups take a step back.
Humana’s CenterWell brand reflects the company’s 2022 reorganization into two business units: health services and Insurance Services. The latter includes Humana’s retail, group, and specialty segments.
This simplification was part of Humana’s “$1 billion value creation initiative.” In the company’s second quarter 2022 earnings call, president and CEO Bruce Broussard reported that the initiative includes “significant expansion of our health care service businesses and further strengthening our Medicare Advantage [MA] and Medicaid platforms.”
The announcement came six months after Humana stock plunged 21%, as the company cut MA enrollment projections roughly in half. Nearly a year later, share prices have not only rebounded but increased 12% from the company’s former high.
Rethink: Bright and Oscar
While Humana demonstrated that what goes down can come up, two insurtechs faced headwinds in 2022.
Bright HealthCare will exit the Exchange and MA markets almost entirely in 2023. The company will reduce both its Marketplace and MA footprints to a single state: the former to Texas, where enrollees will also be limited to off-Exchange purchase, and the latter to California.
Even worse news followed, with the New York Stock Exchange warning the company in December that it may be delisted due to share price. Bright’s average closing price has been less than $1 per share for more than 30 consecutive days.
Bright went public in June 2021 with a $924 million IPO, record-setting for a health insurance company.
Bright isn’t the only insurtech to face challenges. For 2023, Oscar Health will exit two Exchange states and leave the MA market entirely. Oscar also lost its first significant customer for +Oscar, the company’s proprietary tech platform for health plans, and announced it will pause any new Oscar+ deals through early 2024.
Like Bright, Oscar went public in 2021 in a $1.4 billion IPO. Its stock price has dropped from an initial $36 to hovering in the $2 range throughout November 2022.
While the pandemic undoubtedly taking its toll, it’s worrying for companies to stumble in their core value props—better coverage alternatives through a tech-forward approach—and at a time when both the Exchange and MA markets are expanding.
Re-dominate: United and its tech counterparts
United keeps coming out on top, marking one of many massive M&A deals.
How do you devour an elephant? One bite at a time. But what if you are the elephant? You consume entire patches of the landscape at once. In 2022, United acquired Change Healthcare, beating back the Department of Justice’s (DOJ) antitrust suit in a deal valued at $13 billion.
While the DOJ plans to appeal, United has continued to report massive quarterly earnings throughout 2022—from $7 billion in Q1 to $7.5 billion in Q3.
United is to the healthcare world what Amazon and other Big Tech firms hope to be: the dominant player. In July 2022, Amazon acquired primary care startup One Medical for $3.9 billion and has made no secret that it intends to enter healthcare in a big way.
This is happening in billion-dollar fits and starts, something only companies with Amazon’s size and scale can weather as they move in what look like conflicting directions.
Haven—Amazon’s healthcare cost control co-experiment with JPMorgan Chase and Berkshire Hathaway—shuttered within three years. Alexa—the company’s ubiquitous yet “colossal failure” of a voice assistant—largely failed to deliver on the Healthcare Skills that would have embedded the tech giant in multiple healthcare sectors.
In 2022, the company shuttered Amazon Care, its B2B telehealth service, while losing its bid to acquire Signify Health to CVS Health in a deal valued at $8 billion.
Whether positive or negative, moves by Amazon, Google, Microsoft, and Apple show that “Big Tech is coming for healthcare.” Insider Intelligence predicts: “As they penetrate further into healthcare, Big Tech companies are learning important lessons along the way and adjusting their business strategies accordingly … Time will tell if the plan ultimately works out, but it’s a sign that Big Tech firms aren’t afraid to fail and refocus.”
Translation? In the soil of 2022 lookbacks are the seeds of 2023 predictions, including the likelihood that tech will be willing to fail not only fast and often, but big as it seeks to disrupt healthcare.
Laura Beerman is a contributing writer for HealthLeaders.