Eldercare Startup Papa Loses Contracts With Major Health Insurers

Humana, Aetna, Molina decline to renew relationships after a Bloomberg Businessweek investigation revealed allegations of abuse.

(Bloomberg) — Several major US health insurers, including Humana Inc., CVS Health Corp.’s Aetna and Molina Healthcare Inc., are declining to renew contracts with the eldercare startup Papa for the upcoming year, according to people familiar with the matter, after a Bloomberg Businessweek report detailed extensive allegations of abuse from seniors who rely on the service, and its workers.

The insurers’ decisions not to renew partnerships with Papa means the startup is losing some of the deals that make up its primary form of business. Papa relies on contracts with health insurers, including Medicare Advantage, Medicaid and employer-sponsored plans. Insurers that partner with Papa offer its service to their plans’ members, typically for a certain numbers of free hours per year. Members of those health plans, often elderly clients, can then request help with household chores, transportation or just company from the startup’s network of independent contractors. The people who described the insurers’ decisions asked not to be identified because the information is private.

A spokeswoman for Papa declined to comment on specific contracts but said the company has gained new clients since May. She also said one-third of Papa’s clients have “expanded services,” and that the company is still “actively selling 2024 programs.” 

Read More: Assault Allegations Plague a $1.4 Billion Home Eldercare Startup

Papa announced partnerships with Aetna and Humana in 2019. The insurers had previously described the startup’s service as a way to help reduce loneliness among the elderly. Spokesmen for Aetna and Humana declined to comment. A spokeswoman for Molina did not immediately respond to a request for comment. 

In May, a Businessweek investigation based on more than 1,200 confidential complaint reports received by Papa detailed the unintended consequences of sending contractors to the homes of the elderly with little training: allegations of sexual assault, harassment, theft and unsafe conditions.

In July, the chairman of the US Senate Special Committee on Aging sent an inquiry to Papa, asking the company to detail its safety practices. In the letter, Democratic Senator Bob Casey of Pennsylvania said “the allegations of abuse by both Papa care workers and clients, as well as the lack of training and oversight to prevent and address future problems, raise deep concerns.”

That day, the startup announced plans to introduce new trust and safety measures. Among other initiatives, Papa said it would begin anonymizing phone numbers to help prevent harassment between its contractors and clients. Bloomberg had reported that the direct sharing of phone numbers between Papa’s elderly clientele and workers had led to dozens of instances of harassment since at least 2019.

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