After months of teasing the expansion, virtual mental health giant Talkspace (Nasdaq: TALK) has entered the Medicare market.
Talkspace’s services will now be available to 13 million members in 11 states, including California, Florida, New York, Ohio, New Jersey, Virginia, Missouri, Maryland, South Carolina, New Mexico and Idaho.
However, the virtual care company has plans to expand its Medicare coverage to all traditional Medicare members and several Medicare Advantage plans by the end of the year.
The Medicare market represents a massive new patient population for the provider to tap into. Roughly 25% of people 65 and older are living with mental health conditions, according to the National Council on Aging.
Talkspace announced its interest in the Medicare market in 2022 and has since laid the foundations for the launch.
“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,” Talkspace CEO Dr. Jon Cohen said during the company’s Q4 earnings call in January. “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 pitches its Medicare expansion as a way for more seniors to access behavioral health care and improve integrated care.
“Given the alarmingly limited number of behavioral health providers that accept Medicare, Talkspace now opens up access to affordable, high-quality care for millions of Medicare members – within days – from the comfort of their own homes,” Cohen said in a statement. “This launch also enables PCPs to begin more actively referring to Talkspace for their patients’ behavioral health needs as there are only a limited number of national virtual behavioral health providers addressing this population.”
Seniors aren’t the only new focus at Talkspace. Over the past year, the provider has inked several deals with municipalities and school systems to provide services for teens and young adults. For example, in 2023, it inked deals with Baltimore County Public Schools and the city of New York to provide services for young people.
Both Talkspace’s Medicare expansion and its youth-focused partnerships indicate the company’s move from primarily a D2C provider to a B2B provider.
This move appears to have served it well. In 2022, the company was struggling and at risk of being delisted from Nasdaq. However, in Q1 of 2024, it announced its first profitable quarter since going public in 2021.
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