Analogy 1: Think of them as a tech-focused Humana for Medicare Advantage.

Analogy 2: Imagine an Oak Street Health, but as a Medicare Advantage insurance company.

Analogy 3: Oscar Health, but specializing in Medicare Advantage for seniors.

• Medicare Advantage Plans: Comprehensive health insurance plans for eligible seniors, providing medical, hospital, and often prescription drug benefits, frequently bundled with supplemental services like vision and dental.
• Integrated Care Management Services: Proactive health management and care coordination services, including chronic disease management, preventive care, and personalized support for their Medicare Advantage members.

Alignment Healthcare (ALHC) sells primarily to individuals, specifically Medicare beneficiaries. The company operates as a Medicare Advantage (MA) plan provider, offering health insurance plans directly to eligible individuals. Here are the categories of customers it serves:

• Seniors (Aged 65 and over): This is the largest demographic for Medicare Advantage plans. ALHC designs its plans to meet the healthcare needs of older adults, often including benefits focused on chronic condition management, preventive care, and supplemental services like dental, vision, hearing, and fitness programs.
• Individuals Eligible for Medicare Due to Disability: ALHC also serves individuals under the age of 65 who qualify for Medicare due to certain long-term disabilities (e.g., after receiving Social Security Disability Insurance benefits for 24 months) or specific medical conditions such as End-Stage Renal Disease (ESRD) or Amyotrophic Lateral Sclerosis (ALS). Their plans cater to the unique health challenges faced by this group.
• Dual-Eligible Beneficiaries: This category includes individuals who qualify for both Medicare and Medicaid. ALHC offers specialized plans, known as Dual-Eligible Special Needs Plans (D-SNPs), tailored to provide coordinated care and additional support for this vulnerable population, addressing both their medical and often their social determinants of health needs.

• CVS Health (Symbol: CVS)

John Kao, Chief Executive Officer

John Kao founded Alignment Healthcare in 2014 and has served as its Chief Executive Officer and a board member since then. He is a seasoned entrepreneur and executive who previously started four other companies: Secure Horizons USA, PacifiCare Health Systems, The TriZetto Group, and CareMore Medical Enterprises. Prior to Alignment Healthcare, he held executive roles at CareMore Medical Enterprises, Inc., The TriZetto Group, PacifiCare Health Systems, Secure Horizons USA, and FHP International. He was also involved in the acquisition of CareMore in 2006 with CCMP Capital Partners, and CareMore was subsequently acquired by Wellpoint, Inc. in 2011. Kao also served as President & CEO-Venture Division at PacifiCare Health Systems from 1997 to 2000. He earned a Bachelor of Science from Santa Clara University and an MBA from the UCLA Anderson Graduate School of Management, where he was a Venture Capital Fellow.

Jim Head, Chief Financial Officer

Jim Head was appointed Chief Financial Officer of Alignment Healthcare, effective May 2, 2025. Before joining Alignment Healthcare, he served as Executive Vice President and CFO at Claritev (formerly MultiPlan) from November 2021 to August 2024. He also held senior executive leadership roles at the merchant banking firm BDT & Company, LLC, and at Morgan Stanley.

Dawn C. Maroney, President of Markets and CEO of Alignment Health Plan

Dawn Maroney oversees Alignment's consumer experience, growth, and expansion across all areas. She holds the title of President of Markets and CEO of Alignment Health Plan.

Dr. Hyong J. Kim, M.D., Chief Medical Officer

Dr. Hyong J. Kim serves as the Chief Medical Officer at Alignment Healthcare. He oversees case management, clinical delivery, member services, and provider operations, and also leads the company's operations and technology infrastructure. Before joining Alignment, Dr. Kim held leadership roles within HealthCare Partners Medical Group.

Dr. Donald S. Furman, M.D., Co-Founder and Chief Clinical Officer

Dr. Donald S. Furman is a Co-Founder and the Chief Clinical Officer at Alignment Healthcare. He is responsible for ensuring that Alignment's clinical model is implemented across all of the company's markets. Prior to Alignment, he was the senior director of healthcare services at Oliver Wyman, and joined Alignment in 2013.

1. Regulatory Uncertainty and Changes: Alignment Healthcare operates within the highly regulated Medicare Advantage market, making it significantly susceptible to changes in government policies, reimbursement rates, and compliance requirements. New Centers for Medicare & Medicaid Services (CMS) rules, such as those introduced in early 2025 concerning agent compensation, data privacy, and network adequacy, can increase administrative burdens and compliance costs, directly impacting the company's profitability and growth prospects. Furthermore, potential federal reductions in Medicare Advantage funding or shifts in the Five Star Quality Rating System, which influences payments, pose ongoing risks to the business.
2. Highly Competitive Medicare Advantage Market: The Medicare Advantage market is intensely competitive, with a landscape that includes both large, established players and emerging entrants. This competitive environment can challenge Alignment Healthcare's ability to attract and retain members, maintain market share, and exert pricing power. Differentiating its offerings and continually innovating to stand out from competitors like UnitedHealth Group and Humana are crucial for sustained growth.
3. Profitability Challenges and Financial Performance: Despite strong membership and revenue growth, Alignment Healthcare has faced challenges in consistently achieving and maintaining profitability. The company has shown improving margins and has achieved positive adjusted EBITDA in recent periods, but persistent losses and high leverage remain a concern. The ability to translate revenue growth into sustained positive cash flow and net income is critical for investor confidence and long-term financial stability.

The emergence of large, tech-centric companies, notably Amazon, as increasingly significant players in the healthcare delivery and payer space poses a clear emerging threat. Amazon's strategic acquisitions, such as One Medical for primary care services and Amazon Pharmacy for prescription fulfillment, demonstrate a clear intent to build a comprehensive healthcare ecosystem. Should Amazon leverage these growing assets, alongside its vast technological infrastructure, data analytics capabilities, and customer-centric approach, to launch or significantly expand its offerings within the Medicare Advantage market, it could fundamentally disrupt the landscape. Their ability to integrate care, pharmacy, and potentially other services through a highly efficient, technology-driven model could offer a differentiated and competitive product. This scenario could challenge the business models of existing Medicare Advantage providers like Alignment Healthcare by potentially eroding market share and creating a new standard for member experience and cost efficiency, akin to how Netflix disrupted Blockbuster.

Alignment Healthcare (ALHC) is poised for future revenue growth over the next 2-3 years, driven by several key factors:

1. Consistent Membership Growth: A primary driver of Alignment Healthcare's revenue growth is the continued expansion of its health plan membership. The company experienced a 28% year-over-year increase in health plan membership in Q2 2025 and a 26% year-over-year rise in Q3 2025, reaching 229,600 members. Analysts project accelerated long-term membership growth, fueled by an aging U.S. population and increasing Medicare-eligible individuals. The company itself has set a target of over 20% growth for 2026.
2. Strategic Geographic Expansion: Alignment Healthcare is actively expanding its market presence into new geographies. Recent successes include the introduction of two 5-star HMO contracts in Nevada and its Texas HMO contract achieving a 4.5-star rating in its inaugural year, demonstrating the company's ability to replicate high-quality outcomes across various markets. This strategic expansion into new areas contributes to a broader customer base and increased revenue.
3. High Medicare Star Ratings and Enhanced Plan Offerings: The company consistently achieves high Medicare Star Ratings, with 100% of its Medicare Advantage members enrolled in plans rated 4 stars or higher for 2026, significantly surpassing the national average. These superior ratings enhance plan attractiveness, driving enrollment and positively impacting reimbursement, thereby bolstering revenue. Alignment also emphasizes strong benefits and expanded support for seniors in its 2026 Medicare Advantage plans.
4. Investments in Technology and Care Management: Alignment Healthcare's future growth is underpinned by continuous investments in technology and advanced care management systems. These investments aim to improve operational efficiencies, enhance care delivery, and enable better management of medical costs. Analysts note that a robust, technology-enabled care model and investments in administrative automation, workflow standardization, and digital health platforms are expected to lower selling, general, and administrative (SG&A) expenses and improve scalability, thereby supporting margin expansion and overall earnings growth.
5. Effective Medical Cost Management: While not a direct driver of top-line revenue, Alignment Healthcare's improved Medical Benefit Ratio (MBR) signifies effective management of medical costs, which enhances profitability. The company's consolidated MBR improved to 87.2% in Q3 2025, a 120-basis-point improvement over the prior year. This improved profitability provides capital that can be reinvested into growth initiatives, plan enhancements, and further market expansion, indirectly fueling future revenue growth.

Share Repurchases

• Alignment Healthcare has not reported significant share repurchases over the last 3-5 years. For instance, the net total equity issued/repurchased was $0 in 2024.

Share Issuance

• In March 2021, Alignment Healthcare completed an initial public offering (IPO), issuing 21,700,000 shares of common stock.
• Net total equity issued amounted to $389 million in 2021 and $133 million in 2020, likely reflecting proceeds from equity raises including the IPO.
• As of October 27, 2025, there were 200,091,742 shares of common stock outstanding, indicating ongoing share issuance, potentially through equity compensation plans.

Inbound Investments

• The company's IPO in March 2021 represented a significant inbound investment from the public markets.

Outbound Investments

• Alignment Health Plan partnered with Suvida Healthcare, effective October 1, 2025, to expand bilingual primary care access for Arizona seniors.

Capital Expenditures

• The company is actively investing in administrative automation, care navigation, workflow standardization, and digital health platforms.
• These investments are focused on supporting scalable growth, extending competitive advantages, and significantly lowering selling, general, and administrative (SG&A) expenses.