Brazilian healthcare startup Alice debuts its B2B operations with an unusual proposal: a price ceiling for corporate health plans

The startup targets companies with up to 250 employees. The entry in the B2B segment is expected since acquiring Cuidas in November last year.

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Brazil-based healthcare startup Alice announced its B2B debut on Tuesday, a move expected since acquiring primary healthcare startup Cuidas in November last year. With almost 10,000 individual users in its portfolio, Alice launched its B2B operation with two characteristics that seek to set it apart from competitors (traditional or not): a price ceiling (for corporate clients with more than 30 employees) and its own health monitoring methodology called Score Magenta.

“We have a potential market of more than 165,000 companies only in the city of Sao Paulo, our focus at this first moment, and we are very proud to offer an innovative solution, which will bring greater costs stability and a better experience for HRs,” said André Florence, co-founder and CEO of Alice, in a press release.

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Health plans price variation in Brazil has, historically, exceeded (by far) the official inflation, measured by the IPCA. The variation is typically calculated not only considering the biannual updates of all the procedures and treatments that must be covered by any health plan in the country, determined by the National Supplementary Health Agency (ANS) — and against which the operators are fighting in higher courts of Justice right now — but also the loss ratio (the number of procedures accessed by the beneficiaries versus the amount paid by companies to health plans) and the variation in the medical-hospital costs.

Unlike what happens with individual or family plans, corporate health plans in Brazil are not subject to ANS’ price regulation, which contributes to abusive price corrections, with companies reporting 70% increases.

Relying on the methodology it created, which gathers data from each beneficiary, bringing more predictability to costs management, and the ability to promote and anticipate care, Alice will calculate prices adjustments through a combination of contracts: by grouping clients, the startup says it is possible to dilute the costs of customers that experience acute health events.

Alice’s price ceiling will be set at twice the annual IPCA. Based on the history of rising costs in the sector and also the variation of the expenses of its own operations, Alice estimates that, in most cases, the price of health services offered to its clients will be lower than the ceiling.

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“Price adjustments by operators are usually much higher than their price evolutions as a whole, either because of surcharges or because they offer low-cost plans, which require compensations. The consequence is great uncertainty for companies – which are vulnerable to price corrections of up to five times greater than the IPCA – and low operator loyalty,” explained Matheus Moraes, co-founder and chief business officer at Alice.

In 2021, when Alice’s B2B operations started in Beta phase, Alice said it registered one of the lowest price variations in the market: 10.5% (or the IPCA for the period), which, according to the company, represents almost half of the adjustment set by the main operators

Launched in June 2020, Alice was founded by André Florence, Guilherme Azevedo, and Matheus Moraes and has already raised US$ 174.8 million from Allen & Company LLC, Canary, Endeavor Catalyst, Globo Ventures, G Squared, Kaszek, Maya Capital, StepStone Group, SoftBank Latin America Fund, ThornTree Capital Partners.

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