Tag: Medicare

Release – Katherine O’Halloran Appointed as Interim GoHealth Chief Financial Officer 

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Research News and Market Data on GOCO

Jun 04, 2024 at 8:00 AM EDT

O’Halloran, current Chief Accounting Officer, brings 30 years of experience in Finance and Accounting at public and private companies

Former CFO Jason Schulz departs for personal reasons after building high-performing finance organization during company turnaround 

Company to conduct search process for permanent CFO

CHICAGO, June 04, 2024 (GLOBE NEWSWIRE) — GoHealth, Inc. (GoHealth) (NASDAQ: GOCO), a leading health insurance marketplace and Medicare-focused digital health company, announced that its Board of Directors has appointed Katherine O’Halloran, Chief Accounting Officer, as interim Chief Financial Officer.

Ms. O’Halloran’s appointment follows the resignation of Jason Schulz, Chief Financial Officer and Treasurer, effective immediately. Mr. Schulz’s resignation is for personal reasons and is in no way related to his performance, internal relationships, nor GoHealth’s business performance, financial reporting, or controls, where the Company has invested in and built a high performing finance function. Mr. Schulz will continue to support GoHealth with transition services through September 1, 2024 while the Company conducts a search process to identify a permanent CFO. 

“Katie brings significant finance, accounting and audit expertise. With her background and strong knowledge of our business, we are confident that she will effectively lead our finance function during this interim period as we conduct a thorough search process to identify a permanent CFO. As Katie enters her new role, she will be supported by a deep and talented finance team to help build on the momentum underway throughout our business,” said Vijay Kotte, CEO of GoHealth. “I would also like to thank Jason for his contributions as CFO over the last two years, where he has leveraged his significant operating financial expertise to drive our transformational turnaround and establish a strong foundation to drive GoHealth’s continued stability, innovation and growth.” 

Ms. O’Halloran joined GoHealth as Chief Accounting Officer in April 2023. From January 2022 until April 2023, she was the Chief Financial Officer at VanEnkevort Tug & Barge, Inc. Prior to VanEnkevort Tug & Barge, she spent the previous 16 years in various finance and accounting leadership roles at Great Lakes Dredge & Dock Corporation (Nasdaq: GLDD).

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John Shave
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Cigna Unloads Medicare Assets for $3.7B, Ups Investments in Core Segments

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Health insurer Cigna announced Wednesday it is divesting its Medicare Advantage, Medicare Part D, and other Medicare operations to Health Care Service Corporation (HCSC) in a $3.7 billion cash deal.

Cigna said the sale will streamline its business to focus on growing its health services and benefits platforms. Proceeds will also fund share repurchases, with the transaction expected to be accretive to adjusted earnings per share in 2025.

Refocusing the Portfolio

The sale includes Cigna’s Medicare Advantage plans, Medicare Part D prescription drug plans, Cigna Supplemental Benefits, and the CareAllies health support services unit.

With HCSC taking over these businesses, Cigna can direct more investment and resources toward expanding its Evernorth health services division and Cigna Healthcare commercial health benefits segment.

Evernorth provides pharmacy benefits management, specialty pharmacy, and health technology solutions. Cigna Healthcare offers employer-sponsored group health plans as well as individual plans.

While Cigna sees Medicare as an attractive market, the segment required outsized focus and capital relative to its size within Cigna’s broader portfolio. The sale unlocks value and simplifies operations.

Gaining Scale and Capabilities

For HCSC, the transaction accelerates growth in Medicare, where the company has over 1 million members currently across 7 states. Adding Cigna’s Medicare customers and capabilities will expand HCSC’s geographic reach and enhance its product portfolio.

The businesses being acquired generated around $5.5 billion in 2022 revenues for Cigna. So the deal provides HCSC with meaningful membership and revenue growth in Medicare and immediate scale.

Cigna built a significant presence in Medicare through organic growth and acquisitions like HealthSpring in 2011. HCSC gains these customer relationships and infrastructure with the purchase.

Focusing on What Cigna Does Best

Cigna has been optimizing its portfolio under CEO David Cordani to concentrate on its core competencies. Last year, Cigna sold its international life, accident, and supplemental benefits businesses.

The Medicare sale continues this strategic focus on areas where Cigna has differentiated capabilities and growth opportunities. Evernorth provides unique pharmacy solutions and analytics. Cigna Healthcare leverages the company’s strong employer and health plan expertise.

The transaction value of $3.7 billion represents about 10 times Medicare Advantage customer revenue and 16 times Medicare Part D customer revenue. This appears a solid price for Cigna to unlock capital from non-core assets.

Financial Benefits

Cigna expects the deal will be 5-10% accretive to adjusted EPS in 2025 once completed. The company reaffirmed its 2024 outlook and long-term 10-13% annual EPS growth target.

Proceeds from the divestiture will primarily fund share buybacks, representing an attractive return of capital for investors. Cigna previously had around $7.5 billion remaining on its buyback authorization.

The deal is expected to close in the first quarter of 2025 after securing necessary regulatory clearances. There is no financing condition, providing transaction certainty.

Overall, the sale highlights Cigna’s disciplined portfolio approach to drive shareholder value. Consolidating its focus while monetizing Medicare strengthens Cigna’s growth trajectory in targeted segments. For HCSC, the deal accelerates its diversification into a key government market.