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Start-up health insurer Bright Health announced Wednesday that it has been approved to start selling Medicare health plans in Alabama and Colorado next year, moves that fit with the Minneapolis-based company’s June announcement that it had raised $160 million for expansion plans.

Currently, Bright Health sells coverage in Colorado to people in the individual market, which primarily serves those under age 65 who are self-employed or don’t have health insurance benefits from their employer.

Selling Medicare Advantage plans would be a new market for Bright Health. Last month, the company said the federal government cleared Bright Health to sell Medicare plans next year in Arizona.

“This is some of the expansion that the $160 million is funding,” said Bob Sheehy, the co-founder and chief executive of Bright Health, in an interview.

Bright Health is among the start-up health insurers launched since major market changes started in 2014 with the federal Affordable Care Act (ACA). Several start-ups targeted the individual market, while others have focused on Medicare.

Medicare Advantage plans are sold by private insurance companies as an alternative to the traditional government health insurance program for seniors. A Kaiser Family Foundation report from last month found that one in three Medicare beneficiaries now has coverage through a private health plan.

Minnesota has one of the highest takeup rates in the nation, with more than half of beneficiaries in the state covered through a Medicare private health plan, according to the foundation’s report.

Bright Health selected portions of Alabama, Arizona and Colorado for its Medicare expansion because that’s where the insurer found health systems that wanted to partner on products. The insurer’s offerings are co-branded with a local health care system that pledges to coordinate patient care for efficiency.

“We found strong health systems that we’re working with,” Sheehy said.

The Kaiser Family Foundation reported Medicare Advantage takeup rates in those states of just over one-third of beneficiaries, which is slightly higher than the national average.

Sheehy said the company is seeking regulatory approvals in other markets for 2018 and 2019, so other expansion announcements could be coming.

Formerly a top executive with Minnetonka-based UnitedHealthcare, Sheehy launched Bright Health in 2016 with $80 million from investors.

During the first quarter of 2017, the company posted an operating loss of $3.7 million on revenue of $6.4 million. In an interview last month, Sheehy said he was pleased with the performance, saying the loss primarily reflected start-up costs.

Enrollment in Medicare Advantage plans has grown steadily over the past decade, according to the Kaiser Family Foundation, from 9.7 million in 2008 to 19 million this year.

Christopher Snowbeck • 612-673-4744

Twitter: @chrissnowbeck