In 2024, Talkspace (Nasdaq: TALK) will focus on expanding its services to teenagers and seniors via new partnerships with schools and municipalities, as well as broadening its reach within the Medicare program.
Talkspace, which started as a direct-to-consumer company, continues to double down on its payer partnerships and direct-to-enterprise (DTE) strategy. Part of that strategy is enterprise partnerships with organizations looking to help tackle the youth behavioral health crisis.
In late 2023, Talkspace inked deals with Baltimore County Public Schools and the city of New York to provide virtual care services to teens. But this is just the beginning of these types of partnerships, Talkspace CEO Dr. Jon Cohen said during the company’s Q4 earnings call.
“In 2024, we will continue to pursue multiple opportunities in the DTE space with employers, governments and universities,” Cohen said. “We are in conversations with multiple other school districts and will continue to aggressively pursue this market. Our goal is to be the national leader in addressing the teen mental health crisis.”
Meanwhile, it is also looking to expand its care for seniors through its work with Medicare. The virtual care company first announced its Medicare expansion plans in 2022.
“In 2023, we paved the groundwork to be a Medicare provider for both standard Medicare and Medicare Advantage. We will roll it out in all 50 states throughout 2024,” Cohen said. “Medicare has 65 million lives, 33 million standard Medicare and 32 million in Medicare Advantage. …Mental health support for the elderly, particularly loneliness and depression, is a critical issue in their overall health.”
The company’s shift towards the payer and enterprise space and away from the consumer space is clear in its revenue breakdown.
Overall, Talkspace increased its Q4 revenue by 40% year over year to $42.4 million. The company attributes this rise to a 138% increase in payer revenue and a 3% rise in DTE revenue in Q4. Talkspace noted that this increase in revenue offset the 26% year-over-year consumer revenue decline.
For the full year of 2023, the company increased its revenue by 25% to $150 million. It saw a 123% increase in payer revenue and a 19% year-over-year increase in DTE revenue. Meanwhile, its consumer revenue decreased by 35% year-over-year.
The company continues to project profitability in 2024.
One of the other areas in which the company plans to continue to generate more in-network revenue is referral partnerships. For example, in early 2024, the company partnered with digital addiction treatment provider Bicycle Health. The partnership will enable Bicycle and Talkspace clinicians to refer patients to specialized care from either organization through a direct referral pathway.
It also teamed up with women’s health provider Evernow to provide its members with free Talkspace mental health resources for those experiencing menopause or perimenopause.
“We established a business development process to engage new partners and increase referrals to Talkspace by leveraging our in-network status,” Cohen said. “We are pleased with the early traction we are seeing on these efforts.”
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