Item 1. Security and Issuer.
This statement on Schedule 13D (this “Schedule 13D”) relates to the Class A Common Stock, par value $0.0001 per share (the “Class A Shares”), of MSP Recovery, Inc., a Delaware corporation (the “Issuer”). The address of the Issuer’s principal executive offices is 2701 Le Jeune Road, Floor 10, Coral Gables, Florida 33134.
Item 2. Identity and Background.
(a), (f) This Schedule 13D is being filed by Cano Health, Inc., a Delaware corporation (the “Reporting Person”).
Set forth on Annex A attached hereto is a listing of the directors and executive officers of the Reporting Person (collectively, the “Covered Persons”), and certain other information, including the business address and present principal occupation or employment/role of each of the Covered Persons, and is incorporated herein by reference.
(b) The Reporting Person’s principal business address is 9725 NW 117th Avenue, Miami, Florida 33178.
(c) The principal business of the Reporting Person is providing value-based medical care for its members through a network of primary care physicians across 9 states within the U.S. and Puerto Rico, focusing on providing high-touch population health and wellness services to Medicare Advantage, Accountable Care Organization Realizing Equity, Access, and Community Health (“ACO REACH”), Medicare patients under ACO and Medicaid capitated members, particularly in underserved communities by leveraging its proprietary technology platform to deliver high-quality health care services, as well as operating pharmacies in the network for the purpose of providing a full range of managed care services to its members.
(d) During the last 5 years, the Reporting Person has not been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors).
(e) During the last 5 years, the Reporting Person has not been party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding were or are subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration.
The Reporting Person engaged the Issuer, a third-party healthcare claims reimbursement recovery service provider, to use data analytics to identify and recover improper payments made by Medicare, Medicaid and commercial health insurers (each a “Health Plan”), and charged to the Reporting Person under risk agreements, when the Health Plan was not the primary payer under the Medicare Secondary Payer Act and other state and federal laws. The Issuer employs a team of data scientists and medical professionals who analyze historical medical claims data to identify recoverable opportunities, which the Issuer then aggregates and pursues.
In connection with the above, Cano Health, LLC, an indirect subsidiary of the Issuer (“Cano Health”), entered into the following agreements with affiliates of the Issuer: (a) a certain Amended and Restated Claims Recovery and Assignment Agreement (the “Assignment Agreement”), dated as of December 31, 2021, as amended to date, and (b) a certain Purchase Agreement, effective as of September 30, 2022, as amended to date (the “Purchase Agreement,” and together with the Assignment Agreement, the “MSP Agreements”). Pursuant to the terms of the MSP Agreements, Cano Health, LLC had irrevocably assigned certain past claims data to the Issuer, in exchange for consideration which was to be paid by either cash or the Issuer’s Class A Shares to Cano Health, LLC, at the Issuer’s option.
On June 29, 2022, pursuant to the terms of the Assignment Agreement, the Issuer issued 1,000,000 Class A Shares to Cano Health at a unit value of $10.00 per share as consideration for the assignment of past claims data.
Additionally, as payment for $61,677,419.35 in deferred compensation related to the following agreements, which the Issuer had the option to pay to Cano Health in cash or in Issuer stock, on July 7, 2023, the Issuer elected to pay an aggregate of 199,000,001 Class A Shares, of which (i) 80,645,162 Class A Shares were issued as a deferred consideration for the assignment of certain claims pursuant to the Purchase Agreement, and (ii) 118,354,839 Class A Shares were issued as deferred consideration for the assignment of certain claims pursuant to the Assignment Agreement. Pursuant to the terms of the MSP Agreements, the Issuer agreed to make all appropriate filings to register such shares within ten business days of such issuance and use commercially reasonable best efforts to cause such filings to become effective, and the shares to become fully registered, unrestricted and freely tradeable.
The foregoing description of the MSP Agreements does not purport to be complete and is qualified in its entirety by reference to the MSP Agreements filed herewith as Exhibits 99.1 through 99.5 and incorporated by reference herein.
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