Medical analytics company sued after quietly parting ways with Aetna

Listen
Text
  • Small
  • Medium
  • Large

Medical data analytics company Ontrak has been handed a lawsuit by investors after it allegedly concealed for months that its contract with Aetna was likely to be terminated.

The lawsuit, filed Aug. 6, alleges Ontrak failed to complete a corrective action plan issued by Aetna after a review in 2020, leading to the end of the contract. The company then raised $42.8 million in gross preferred stock proceeds in December 2020, but stocks tanked on March 1 when the company announced that Aetna would be ending the contract. 

Aetna ended its contract with the company effective June 2021 — the largest contract Ontrak had — which involved Ontrak analyzing behavioral health data for the insurer's members, according to the Los Angeles Business Journal. The fallout caused Ontrak to have a massive dip in projected earnings to the tune of $60 million.

Ontrak later tapped Aetna executive Jonathan Mayhew to replace its founder as CEO, leading some to speculate it hoped the move would repair relations, according to the Los Angeles Business Journal.  
Ontrak had no comment on ongoing litigation, but pointed to the class action lawsuit disclosure in their recent 10-Q form and upcoming motions to respond to the claims made.

Copyright © 2021 Becker's Healthcare. All Rights Reserved. Privacy Policy. Cookie Policy. Linking and Reprinting Policy.

 

Featured Whitepapers

Featured Webinars