Troy Medicare

http://troymedicare.com/

Business Type :

Health care

Funding round :

Series B

Funding Price :

$25 million

Troy Medicare offers Medicare Advantage plans to seniors in North Carolina with an unusual twist: the plan pays community pharmacists to keep their members healthier. It’s in its first year of offering health plans. 

The company is currently raising a $25 million Series B funding round, and we obtained a copy of the deck the company’s team is using to pitch investors.

It’s a much smaller amount compared to other Medicare Advantage startups that have taken in hundreds of millions early on to fuel their growth and compete with the industry’s leaders. 

Read more: A health insurance startup in North Carolina is betting on pharmacists in an entirely new approach to a $327 billion market

“Troy Medicare’s progress has surpassed all expectations,” Troy CEO Flaviu Simihaian told Business Insider in response to a request for comment. “By empowering local providers and pharmacies with streamlined operations and fair pricing, each member receives the best, tailored, hyper-local care. Now, we are focused on scaling the Troy model to more states.”

Competition for the 22 million Americans enrolled in Medicare Advantage plans, and the thousands signing up daily as they turn 65, is fierce. Medicare Advantage is a privately run alternative to the traditional Medicare program, which provides medical coverage for seniors and some others in the US.

Here’s a look at Troy’s pharmacy-driven approach to taking on the massive market. 

The Startup Deck Slides

Troy Medicare slide deck

The deck starts out with a bright red slide with Troy's logo.

Troy Medicare slide deck

The presentation immediately launches into what Troy's focusing on, namely removing "the fat" in Medicare Advantage, though it doesn't immediately specify what that is.

Troy Medicare slide deck

Then the deck lays out the scope of the market for Troy. As of 2019, 22 million people were enrolled in Medicare Advantage plans, the private plan side of the federally-funded Medicare program for seniors 65 and up. The slide deck cites estimates that the market will grow to 40 million members and $800 billion in size by 2025.

Troy Medicare slide deck

Next, the deck gives context around independent pharmacies, emphasizing just how big a piece of the overall pharmacy business they are compared to big chains like Walgreens and CVS Health as well as explaining how many times patients are at the pharmacy.

Troy Medicare slide deck

Troy is also clear it's up against stiff competition. In North Carolina, Troy is competing against some of the biggest insurers in the US, like UnitedHealthcare, Humana, and Cigna.

Troy Medicare slide deck

Finally, the deck gets into "the fat." By the company's calculations, that includes everything from marketing the plans, to brokers who help seniors find plans, to companies that help manage the pharmacy benefit or care management.

Troy Medicare slide deck

That, the deck argues, is where Troy comes in, in particular by leveraging the pharmacists that operate independent pharmacies around the US.

Troy Medicare slide deck

The company then provides a quick timeline of what it's already accomplished. 2020 is the first year the company has offered health plans. It enrolled roughly 250 members going into 2020 and says it spent $0 on customer acquisition costs.

Troy Medicare slide deck

Importantly, Troy breaks down its financial projections, noting the amount of capital it has raised and is looking to raise. By 2026, its seventh year offering plans, it expects to have nearly 25,000 members and report a net gain of $33.4 million.

Troy Medicare slide deck

The deck then breaks down how Troy is able to acquire customers at a lower cost than rivals, by relying on pharmacists to promote the plan to their patients. Troy also pays the pharmacists $30 a month to manage the care of patients.

Troy Medicare slide deck

The pharmacists aren't just responsible for getting the word out about the health plan, they're also on the hook to help manage the health of the members. The pharmacy meets with each member once a month not only to discuss medications but also to talk about their broader health goals.

Troy Medicare slide deck

The plan also has perks, such as $0 primary care visits, coverage of certain durable medical equipment, as well as a transparent list of the prices of medications that are covered.

Troy Medicare slide deck

Going into its second year offering plans, Troy has the goal of expanding to more counties within North Carolina, while also looking to meet with the insurance departments in nearby South Carolina, Virginia, and Tennessee. The startup also plans to add a new plan that serves a population eligible for both Medicare and Medicaid.

Troy Medicare slide deck

At the end, the deck spends three slides laying out the members of Troy's leadership team, noting their backgrounds in the industry.

Troy Medicare slide deck

The team includes pharmacists, including clinical director Amina Abubakar, who owns Rx Clinic Pharmacy in Charlotte, North Carolina and serves as Troy's clinical director.

Troy Medicare slide deck

Also on the team: Jeff Spight, who serves as chairman of the board. Prior to joining Troy, he was the president of Universal American's ACO business.

Troy Medicare slide deck

The presentation ends with the basics around what Troy's looking to raise. The deck notes that much of what's been raised so far comes from pharmacists and doctors.