Bright Health Raises Cash to Combat $500M Loss

By Allison Bell

News October 20, 2022 at 11:09 AM

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Bright Health Group, a health insurer and clinic manager that lost close to $500 million in the first half, has raised $175 million in financing.

The Minneapolis-based company generated the cash by selling convertible perpetual preferred stock.

The buyer list for the offering includes affiliates of New Enterprise Associates, StepStone Group and Bessemer Venture Partners.

Bright Health will release its third-quarter earnings on Nov. 9.

Bright Health reported in August that it lost $488 million during the first six months of the year on $3.4 billion in revenue, compared with a $70 million net loss on $2 billion in revenue for the first half of 2021.

Bright Health started up in 2016. It now has 1 million Medicare Advantage plan and commercial health plan enrollees.

The company announced last week that it intends to give up its ordinary commercial health insurance operations in 2023, and most of its Medicare Advantage plan operations.

The company said it will focus on offering Medicare Advantage plans in California and Florida, and running accountable care organization plans and clinics in California, Florida and Texas.

The company predicted that it will generate $3 billion in revenue next year, from serving 125,000 in Medicare Advantage plan enrollees, 150,000 enrollees in accountable care organization and value-based care plans, and patients at about 75 health care clinics.

(Image: CMS)

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