Alignment Healthcare is bolstering its management team, adding the chairman’s role to top executive and founder John Kao’s duties while promoting several others as the company sells more Medicare Advantage plans.
The announcement Tuesday afternoon comes after the company has turned profitable even as health insurers selling Medicare Advantage plans struggle to contain costs of older adults with high medical expenses.
Medicare Advantage plans contract with the federal government to provide traditional coverage available in traditional Medicare plus extra benefits and services to seniors, such as disease management and nurse help hotlines with some also offering vision, dental care and wellness programs. Like many of its rival health insurers, particularly those in the Medicare Advantage business, Alignment has been battling rising medical expenses from customers in its health plans.
But Alignment’s first quarter earnings report two weeks ago showed the company’s medical benefit ratio, which is the percentage of premium revenue that goes toward medical costs, was down to 88%. Rivals have had such ratios at 90% or greater.
“Alignment is making strong progress as we enter our next phase of growth,” Kao, 64, who founded Alignment in 2013 and has been its CEO through a 2021 initial public offering, said in a statement. “Taking on the role of chairman allows me to work even more closely with the board as we focus on disciplined execution, long-term value creation and delivering for the seniors and providers we serve.”
To be sure, Alignment’s market capitalization has grown and the company is set to join the S&P SmallCap 600 before trading opens Thursday morning on the Nasdaq, replacing Sun Country Airlines Holdings, the S&P announced Monday.
In other moves announced Tuesday, Alignment said previous board chairman and veteran healthcare executive Joseph Konowiecki, 72, will serve as vice chairman of the board and has been named executive vice president of corporate affairs. “As EVP of Corporate Affairs, Konowiecki will oversee human resources, legal and communications, bringing even greater cohesion across functions that enable enterprise focus and execution,” the company said. “He will also help advance the company’s strategic positioning as Alignment grows.”
Joining the company is Mark Kent, 58, who will be president of its management services organization. “Kent brings extensive experience leading value-based primary care and provider platforms, most recently serving as chief executive of a multi-state primary care organization and previously holding senior leadership roles at Humana’s Florida primary care operations,” the company said.
Alignment also said that Shane Hochradel, 46, will join the company in June as Chief Operations Officer. “Hochradel brings experience leading complex healthcare operations across Medicare, Medicaid and commercial businesses, most recently at Elevance Health and previously at UnitedHealth Group and Highmark Health,” the company added.
