Minneapolis-based insurer Bright Health said Thursday it has raised another $200 million to support ongoing expansion.
Bright Health announced plans this summer to expand into portions of New York, Ohio and Tennessee. It already competes in parts of Alabama, Arizona and Colorado.
Launched in 2016, Bright Health initially focused on selling individual market health plans that comply with the federal Affordable Care Act (ACA) and has since added Medicare Advantage plans for seniors.
“With our recently announced expansion, we will triple our geographic footprint in 2019,” said Bob Sheehy, the startup company’s chief executive, in a Thursday statement. Sheehy said the health plan is seeing a high re-enrollment rate among current subscribers.
Bright Health said it has raised more than $440 million in three rounds of equity financing since 2016.
The company sells insurance that’s focused on one health care system in a community, with the goal of letting the network of doctors and hospitals coordinate medical services for efficient, high-quality care. The company focused first in 2017 on the individual market in Denver before adding Medicare plans this year in Denver, Birmingham, Ala., and Phoenix.
Next year, the company is adding health insurance products for 2019 in Tucson, four metro areas in Ohio, three metro areas in Tennessee and New York City. In the individual market, which serves people under age 65 who are self-employed or don’t get job-based coverage, next year the company will start selling health plans in Phoenix, Tucson, Ariz., and the three Tennessee markets.
The individual market underwent sweeping change starting in 2014 with the ACA, which prohibits insurers from denying coverage to people with pre-existing health conditions. Whereas many large carriers pulled back in the market after financial losses, there have been roughly a dozen examples where carriers such as Bright Health for 2019 are expanding in the individual market.
Sheehy is a former executive with Minnetonka-based UnitedHealthcare, the nation’s largest health insurer.