MSP Recovery, Inc.

What they do

MSP Recovery acquires irrevocable assignments of healthcare claims from payers, providers, and patients, then uses data analytics and litigation to recover improper payments. The company focuses on Medicare and Medicaid, which are payers of last resort, and estimates at least 10% of Medicare spending is improperly paid by private plans. It acts as plaintiff in lawsuits and controls litigation, differentiating itself from competitors that operate under vendor contracts.

Revenue drivers

• Claims recovery income — Primary revenue source from settlements and judgments on assigned claims under the Medicare Secondary Payer (MSP) Act; as of Dec 31, 2024, approximately 95.9% of expected recoveries arise from MSP Act claims.
• Data analytics and technology services — Provides historical and near real-time solutions for payers, providers, and patients, though no specific revenue split is provided.
• Legal and comprehensive services — Offers services to healthcare and legal industries, but the filing does not quantify this segment's revenue.

Recent performance

For fiscal 2024, MSP Recovery reported a net loss of $360.5 million, a significant increase from $56.3 million in 2023. Diluted EPS was $-359.95 in 2024 versus $-158.02 in 2023. Operating cash flow was negative $16.1 million in 2024, improving from negative $40.0 million in 2023. As of September 30, 2025, the company had total assets of $1.55 billion, total liabilities of $2.40 billion, and shareholder equity of $-563.8 million. Cash and equivalents were only $1.8 million at September 30, 2025, with $1.1 million due to assignors and $0.8 million to Law Firm.

Strategy

MSP Recovery aims to scale its portfolio of assigned claims, which as of December 31, 2024, included approximately $1,591 billion in Billed Amount and $87.7 billion in Paid Value of Potentially Recoverable Claims. The company leverages its proprietary data analytics platform to identify waste, fraud, and abuse, and pursues recoveries through litigation. It also seeks to expand its serviceable market, estimated at over $161.5 billion annually, by attracting new assignors and obtaining additional claims data.

Risks

• Going concern risk — Management has concluded there is substantial doubt about the company's ability to continue as a going concern due to a history of losses and extremely limited liquidity.
• Dependence on litigation outcomes — Recoveries depend on complex, novel legal theories with little precedent, and unfavorable rulings or delays could limit collections.
• Limited cash and liquidity constraints — As of September 30, 2025, unrestricted cash was only $1.8 million, with significant payables to professional advisors restricting access to services.
• Data access rights termination — For a significant portion of assigned claims, the ability to pursue recoveries depends on ongoing data access rights; termination would substantially impair recoveries.

Outlook

Management anticipates using the Yorkville SEPA as the sole source of short-term liquidity, as the Operational Collection Floor facility is fully utilized with no remaining capacity. The company expects 2025 sources of liquidity to include the SEPA, funding for working capital under the facility (though fully utilized), and revenue from claims recovery income. However, the outlook is uncertain given the going concern and the need for successful recoveries.