Bright Health Group told investors this month it needs to raise more capital over the next year, describing the move as a long-anticipated step for the fast-growing health insurer, the Minneapolis Star Tribune reported. But in regulatory filings this month, Bright Health delivered the same core message with greater urgency, saying that there's "substantial doubt" the company can continue as a going concern without raising more capital. The Bloomington, Minn.-based insurer has a history of operating losses including a net loss of $432 million during the first six months of 2022, it said in a report to Florida regulators about second quarter financial results. The losses, coupled with membership growth, mean the company had to set aside more reserve funds as required by insurance regulators, thereby reducing cash for running the business. "Based on our projected cash flows and absent any other action, Bright Health Group will require additional liquidity to meet its obligation as they come due in the 12 months following the date the statutory basis financial statements are issued," the company said in the mid-August filing. "These conditions raise substantial doubt about the company's ability to continue as a going concern." Founded in 2015, Bright Health sells health insurance coverage to individuals under age 65 through government-run health exchanges. It also runs Medicare Advantage health plans for seniors who opt to receive their government insurance benefits through private managed care companies. Beyond insurance, the company operates medical clinics and has touted how a partnership between its health plans and health care providers can deliver better quality for patients at a lower cost. As of June, Bright Health had about 970,000 individual market enrollees and 120,000 people in Medicare Advantage plans. An enrollment surge in 2021 complicated by COVID-19 issues made it difficult for the insurer to accurately calculate risk scores for enrollees. As a result, the company took a big revenue hit due to unexpected risk adjustment payments, where funds are transferred to insurers in the individual market that cover more people at risk of needing costly medical services.
