Determined to look into Clover Well being (Ticker: CLOV) since I’ve been listening to suggestion on it for the dip. Began with all the professionals of the corporate and thought it was nice! Development! Development! Development! However then as soon as I received to the cons that hype dropped to the bottom quick. I needed to create this put up to save lots of time for anybody that is likely to be excited about CLOV. Citations are on the finish so you are able to do your individual analysis. I do have a place in CLOV as I believe the inventory might rebound a bit through technical evaluation. Not a monetary recommendation.

Abstract (if lazy):

A inventory that was hyped by Chamath. If cleared by DOJ and brief, there are potential for development. Nevertheless, some allegations are arduous to show your head the opposite method. Additionally, essential to notice that it’s David vs bunch of Goliath on this closely regulated trade. CEO kinda sketchy. At this level, cons over weighs the professionals.

Atm value dropped right down to a reasonably good resistance close to $10.60 – $11.00, I’ll be shopping for hoping for rebound with information fading away and earnings on March 1.

My place atm is 15 $12.5 CALL 5/21

**Submit might be edited and up to date based mostly off any informative feedback.

Primary Information of the Firm:

1 In regards to the firm

  • Clover well being is an information pushed healthcare expertise firm (Backed by Alphabet Inc/Google) based mostly in San Francisco that gives Medicare Benefit merchandise to seniors and low-income members. As of early 2020 that they had 57,000 members with plans supplied in 34 counties throughout seven state. Their plan for growth will carry protection to a complete of 64 extra counties. This growth will enhance Clover’s market alternative to almost 5 million Medicare eligible.

2 Distinction between Unique Medicare and Medicare Benefit plan

  • Unique Medicare (elements A and B) is obtainable by the federal government and covers a few of the prices of hospitals (half A) and physician visits (half B) – however it might not supply the complete protection you want. This will have excessive copays and coinsurance, which may result in important prices if you could go to the hospital.

  • Medicare Benefit plans (half C) provide you with all of the protection of unique Medicare and sometimes embody half D prescription drug protection. As well as, they could supply dental and imaginative and prescient profit + others…

3 What’s totally different about Clover Benefit Plan

  • As said at #1, Clover Well being offers Medicare Benefit Plan. Which implies they’ll cowl all the things said above in #2. Moreover, they offer you entry to higher prescription drug protection than standalone half D plans, in addition to extra advantages like low price.

Four They’ve a novel mannequin in medical health insurance

  • Clover companions with main care physicians utilizing its software program platform, the Clover Assistant, to ship data-driven, personalised insights on the level of care.


1. Clover Assistant

  • That is their flagship platform that aggregates hundreds of thousands of related well being information factors – together with claims, medical charts, and diagnostics, amongst others – and makes use of machine studying to synthesize that information with member-specific info. This offers physicians with actionable and personalised insights on the level of care, providing strategies for medicines and dosages in addition to the necessity for checks or referrals, amongst different, to in the end enhance well being outcomes.1*

  • Mainly, this new software program makes the medical doctors blissful (not like the legacy programs) and makes the sufferers blissful because it permits them to save cash and have higher affected person outcomes.

2. Quickest Rising Medicare benefit insurer within the US

  • Clover captured a median of 50% of the online enhance in membership throughout its established markets over the past three years. Due to their goal demographic, it makes it simpler for them to broaden into traditionally undeserved and rural communities. As talked about above, they’re planning to broaden into a further 74 counties and introduced a brand new partnership with Walmart to make joint Clover-Walmart plans obtainable to half one million medicare-eligibles within the eight Georgia counties.

3. The market

  • The well being market is without doubt one of the largest within the nation representing $3.Eight trillion or 17.8% of gross home product in 2019. Moreover, healthcare expenditures are forecasted to develop to $6.2 trillion by 2028. An essential a part of this market is the insurance coverage trade, and extra particularly the Medicare plans which in 2020 had greater than 62 million individuals enrolled in, and 39% of these individuals (24.1million) enrolled in Medicare benefit plans.2*


1. Hindenburg Analysis

This is without doubt one of the main catalysts to traders in relation to investing in CLOV. I’ll go over a few of the essential situation from the Hindenburg analysis and solutions offered by Clover Well being. If you happen to’d like to take a look at the report your self checkout quotation beneath3*.

It’s essential to notice that Clover Well being did present a rebuttal/solutions (fairly lengthy) to all of the factors on Hindenburg Analysis4*. Hindenburg then replied to that as properly lol5*.

Critically Clover has not disclosed that its enterprise mannequin and its software program providing, referred to as the clover assistant, are beneath energetic investigation by the DOJ, which is investigating at the least 12 points starting from kick backs to advertising practices to undisclosed third-party offers, in keeping with a civil investigative demand we obtained.

  • Clover Response – Mentioned to lawyer about it, they usually mentioned it’s not essential to let the general public know.

  • Ideas – Actually comes right down to SPEC vs IPO, with SPEC being looser and within the gray space. It will have been the best factor to tell the general public traders of those info, now they’ll should cope with all of the lawsuits. Subsequent, the civil investigative demand from DOJ was acquired by a proper worker of CLOV and never CLOV itself. CLOV did obtain a request for info from DOJ however not a civil investigative calls for or subpoenas from DOJ. This tells me it’s unclear if an investigation have been opened for CLOV or if it’s simply inquiries leaping round.

Clover has a thinly disclosed subsidiary referred to as “Search Insurance coverage”. Search makes no point out of its relationship with Clover on its web site but misleadingly advertises to seniors that it affords “unbiased” and “unbiased” recommendation on choosing Medicare plans. It claims, “We don’t work for insurance coverage firms. We be just right for you”, regardless of actually being owned by Clover, an insurance coverage firm. Its actions are additionally beneath investigation by the DOJ.

  • Clover Response – Search is a begin up that’s arrange as a separate firm from clover. Offers search gross sales in the newest AEP: #1 Cigna:20%, #2 Humana:20%, #Three CVS/Aetna:17%, #Four Clover:13.5%…

  • Ideas – Doesn’t look good on Clover’s finish. Search can’t state it offers unbiased report when 50% of its stake is owned by clover.

A number of former workers defined that a lot of Clover’s gross sales are fueled by a serious undisclosed relationship between Clover and an out of doors brokerage agency managed by Clover’s Head of Gross sales, Hiram Bermudez. One former worker estimated Bermudez drove ~68% of Clover’s complete gross sales, although was unclear on the quantity coming from the undisclosed relationship.

  • Clover Response – Admits that there’s transaction between B&H assurance and says Bermudez nonetheless work on behalf of B&H in case he quits Clover.

  • Ideas – Admitting to that is good however 100% battle of curiosity. Nevertheless, its common for insurance coverage firms to make use of brokers.

Clover reported that “onboarded” physicians used Clover Assistant for 92% of member visits in 2019, however by no means outlined “onboarded”. We discovered that lower than half of Clover’s in-network medical doctors are thought-about “Clover Most popular”. What’s the definition of an “onboarded” doctor? What proportion of Clover’s in-network medical doctors really use the Clover Assistant?

  • Clover Response –onboarding = physicians that went via coaching for clover assistant.contracting = defined advantage of clover assistant to the physicians they usually have agreed to make use of it.Presently 22% of all in-network main care physicians are stay. This correlate to 4% of the entire in-network physicians. In YE2020 56% of the membership have been attributed to a type of 22% stay PCPs. And a further 11% are attributed to a PCP who’s contracted however within the onboarding pipeline. In conclusion, 67% complete protection of clover assistant as of YE2020

  • Ideas – wordings are complicated on clovers half, however the numbers don’t look as dangerous.

Clover claims its software program “delights” physicians, however in keeping with medical doctors and former workers we interviewed, they use it as a result of Clover pays them further to make use of it. Physicians are paid $200 per go to to make use of the software program, twice the traditional reimbursement fee for a Medicare go to.

  • Clover Response – simply incentivizing to make use of the software program. The $200 is to not use the software program however represents the general cost that covers each the PCP workplace go to and using the clover assistant.

  • Ideas – Clover have been fairly up entrance about this situation, not too related imo.

In a CNBC interview asserting the Clover transaction, Chamath proclaimed, unprompted, “they create transparency…they don’t inspire medical doctors to up code or do all types of issues to receives a commission”. A former worker defined to us that the DOJ is particularly asking about upcoding, or the apply of overbilling Medicare.

  • Clover Response – agrees upcoding is an issue within the trade. They pay pcp mounted flat cost per workplace go to which doesn’t incentivize physicians to up code. They preserve outdated prognosis simply in case, so it reveals up once more

  • Ideas – I don’t assume it was properly addressed how their system fails to take away outdated irrelevant diagnoses which might have an effect on Medicare benefit reimbursements resulting in upcoding.

2. CEO of Clover Well being is kinda sketchy

Earlier than I begin, it’s essential to notice that these info beneath have been obtainable in 2020 earlier than the merger announcement. I’ll simply instantly copy paste what Hindenburg report wrote however you will discover totally different articles on google3*.

  • Previous to founding Clover, CEO Vivek Garipalli owned Three New Jersey hospitals via an organization referred to as CarePoint Well being. CarePoint was publicly lambasted for price-gouging; its hospital charged the very best costs for emergency room remedy in the whole nation. For instance, native media reported that Garipalli’s hospitals charged a instructor $9,000 for a bandaged finger and a tetanus shot, and one other affected person $17,000 for 5-6 stiches on a reduce hand.

  • CarePoint’s predatory price-gouging was profitable. However in 2020, New Jersey legislators accused Garipalli – now a public firm CEO – of siphoning over $157 million from his hospital community via a byzantine internet of LLC shell entities. The transactions left the hospitals financially crippled, resulting in layoffs and a liquidating sale course of to new house owners.

3. Hyped by Chamath Palihapaitityasfga

Once more, Not a monetary Recommendation.

* Quotation:


  2. https://search


  4. eliminated when posting, could possibly be discovered when searched on google.



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