View:
United States securities and exchange commission logo
September 9, 2022
Vivek Garipalli
Chief Executive Officer
Clover Health Investments, Corp.
3401 Mallory Lane, Suite 210
Franklin, Tennessee 37067
Re: Clover Health
Investments, Corp.
Form 10-K for the
Fiscal Year Ended December 31, 2021
Form 10-Q for the
Quarterly Period Ended June 30, 2022
Form 8-K filed
August 8, 2022
File No. 001-39252
Dear Mr. Garipalli:
We have limited our review of your filing to the financial
statements and related
disclosures and have the following comments. In some of our comments, we
may ask you to
provide us with information so we may better understand your disclosure.
Please respond to these comments within ten business days by
providing the requested
information or advise us as soon as possible when you will respond. If
you do not believe our
comments apply to your facts and circumstances, please tell us why in
your response.
After reviewing your
response to these comments, we may have additional comments.
Form 10-Q for the Quarterly Period Ended June 30, 2022
Condensed Consolidated Statements of Changes in Convertible Preferred
Stock and
Stockholders Equity, page 8
1. We note that the
activity and number of shares of Class A and Class B common stock are
combined into the same
column. Please revise, in your future filings, to present separate
columns for the Class A
and the Class B common stock and the related activities. In
addition, provide
similar disaggregation for your Treasury Stock to clarify which class of
outstanding stock the
treasury stock relates to.
Notes to Unaudited Condensed Consolidated Financial Statements
Note 2. Summary of Significant Accounting Policies
Performance Guarantees, page 12
Vivek Garipalli
FirstName LastNameVivek Garipalli
Clover Health Investments, Corp.
Comapany 9,
September NameClover
2022 Health Investments, Corp.
September
Page 2 9, 2022 Page 2
FirstName LastName
2. Please tell us and revise to disclose, in your future filings, the
authoritative accounting
literature the Company is applying in accounting for the performance
guarantees through
your participation in the Centers for Medicare and Medicaid Services'
( CMS ) Global
and Professional Direct Contracting model.
Form 8-K filed August 8, 2022
Exhibit 99.1
Financial Outlook, page 1
3. We note your reference to non-insurance margin contribution. Please
address the
following:
Tell us how you use this measure and if you report it in your
filings;
To the extent that you continue to use it and report it, tell us
and revise your future
filings to define this measure and confirm whether it is a
non-GAAP measure;
Tell us how it relates to or compares to your non-insurance gross
profit non-GAAP
measure; and
Provide other disclosures required by Item 10(e), including a
reconciliation to the
most directly comparable GAAP measure.
Adjusted EBITDA Reconciliation, page 6
4. We note your presentation of the non-GAAP measure "Adjusted EBITDA",
which
excludes the impact of the premium deficiency reserve (benefit)
expense. Please explain
to us your basis for excluding the premium deficiency (reserve)
expense. Ensure your
response addresses your consideration of the following:
Tell us your consideration of whether this relates to a normal,
recurring, cash
operating (benefit) expense of the Company;
Regarding your response to the bullet above, tell us whether the
charges associated
with this adjustment relate to liabilities that required, or will
require, cash settlement,
or would have required cash settlement absent an ability to
settle in another manner;
We note that this adjustment was not included in your definition
of Adjusted
EBITDA in prior year filings, tell us if there was any change to
your business
activities and why you believe it is now meaningful to exclude it
from your Adjusted
EBITDA compared to the prior years; and
Tell us how you considered whether this represents tailored
accounting, which is
prohibited by Rule 100(b) of Regulation G, as discussed in
Question 100.04 of the
Non-GAAP Financial Measures Compliance and Disclosures
Interpretations.
Adjusted Operating Expenses Reconciliation, page 7
5. We note your reconciliation for "Adjusted Operating Expenses"
reconciles to "total
salaries and benefits plus general and administrative expenses" as the
most directly
comparable GAAP measure rather than total operating expenses.
Similarly, we note that
Vivek Garipalli
Clover Health Investments, Corp.
September 9, 2022
Page 3
this measure excludes other operating expenses of the Company (e.g.,
net medical claims
incurred). Please revise the caption of this non-GAAP measure, and any
non-GAAP
measures related to it, to more appropriately reflect and describe the
nature of the
expenses that it represents.
In closing, we remind you that the company and its management are
responsible for the
accuracy and adequacy of their disclosures, notwithstanding any review,
comments, action or
absence of action by the staff.
You may contact Marc Thomas at (202)551-3452 or Robert Klein at
(202)551-3847 with
any questions.
FirstName LastNameVivek Garipalli Sincerely,
Comapany NameClover Health Investments, Corp.
Division of
Corporation Finance
September 9, 2022 Page 3 Office of Finance
FirstName LastName