As more patients turn to digital tools during the Covid-19 pandemic, remote patient monitoring companies are getting a boost. Mountain View, California-based Livongo, which offers solutions for managing diabetes, hypertension and other chronic conditions, raised its guidance for the end of 2020.
The company expects to bring in between $290 million and $303 million in revenue for 2020, an increase from its previous guidance of $280 million to $290 million.
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CEO Zane Burke said regulatory changes to telehealth reimbursement, along with an uptick in the number of patients using these tools, mean “the genie is out of the bottle in terms of remote patient monitoring.”
“That’s going to be part of the future healthcare system as it moves forward,” he said in a Wednesday earnings call.
In the quarter ending on March 31, Livongo had 328,000 enrolled members, double the prior year. The company also more than doubled its revenue, which increased from $32 million last year to $68.8 million. Livongo saw a net loss of $5.6 million during the first quarter.
Livongo has also brought on some large clients this year.
In early April, Livongo struck a contract with Kaiser Permanente to give its members access to Livongo’s behavioral health solution. The company also recently signed one of its largest contracts yet with the Government Employee Health Association (GEHA), adding roughly 2 million members.
Lee’s Summit, Missouri-based GEHA offers health plans for federal employees. The company is offering Livongo’s diabetes, hypertension and diabetes prevention solutions.
As with the GEHA contract, companies are starting to buy into more of Livongo’s solutions, CFO Lee Shapiro said. Roughly 20% of Livongo’s client base have purchased multiple solutions from the company.
“What’s interesting is that we’re starting to see clients that are signing contracts for multiple solutions,” he said. “And we’re seeing that across many of our new contract signings. We’ve also been going back into our existing client base and selling through more solutions.”
In total, Livongo had 1,252 clients at the end of March.
One challenge Livongo will face, as will any company selling to health plans, is that many companies have furloughed or laid off some of their staff in recent months. With more than 33 million people filing for employment across the U.S. since the pandemic started, Livongo said it has baked possible cuts into its guidance for 2020.
So far, the company hasn’t been affected much yet, as most employers that have furloughed workers continue to cover their benefits. Other companies that have laid off workers have still structured ongoing benefit payments to cover them for a period of time, Shapiro said.
Livongo’s stock was valued at $52.56 at market open on Thursday, up 12% from market close on Wednesday.
Photo credit: Livongo
