Here’s the latest bit of bad news for Obamacare supporters: Insurer Health Republic Insurance, of Lake Oswego, Oregon, will no longer be offering coverage beyond 2015 after the Centers for Medicare and Medicaid Services decided to reimburse only a fraction of the organization’s losses. The decision means nearly 15,000 people will have to find new health insurance for next year, according to the Portland Business Journal.
This means that more than one-third of the 23 federally designated consumer operated and oriented plans under the Patient Protection and Affordable Care Act have failed, the business paper reported. Oregon was the only state with more than one CO-OP.
Health Republic Insurance made the decision after CMS decided that it would only pay 12.6 percent of what insures billed the government under the “risk corridors” program for 2014. This would cost the Oregon CO-OP more than $20 million.
With the Rise of AI, What IP Disputes in Healthcare Are Likely to Emerge?
Munck Wilson Mandala Partner Greg Howison shared his perspective on some of the legal ramifications around AI, IP, connected devices and the data they generate, in response to emailed questions.
The program is intended to limit losses for insurers taking on high-risk patients. Health Republic said that it was left in an “unstable position,” particularly with CMS declining to say when it might pay insurers for 2015 under the same program.
“This has placed us in a difficult financial position that could jeopardize our members and partners. As a result, we believe the most ethical step is for Health Republic to refrain from entering the market in 2016 and begin an orderly wind down of business,” Health Republic CEO Dawn Bonder said in a statement.
The insurer is advising those upset with the decision to direct their ire to Oregon’s congressional delegation. Health Republic offered this sample language for writing angry letters (emphasis in original):
Congress passed the Affordable Care Act and called on new, smaller regional health plans like Health Republic Insurance to take on big risks by covering previously uninsured people. Congress knew there were risks. That’s why they set up a federal program to protect new health plans. They promised to pay these health plans for helping people get insurance. Now the Feds are backing out on their promise and owe billions to smaller competitive health plans across the country.
On Oct. 1, the Feds informed health insurance plans across the country they would not be receiving billions of dollars owed to them this year
The Feds are jeopardizing the stability of local and regional health plans that did their part.
Health Republic Insurance is owed over $20 million in “risk corridor” payments for helping more people get health insurance coverage.
The payment of only 12.6% of the 2014 risk corridor and uncertainty about the 2015 risk corridor dealt a lethal blow to Health Republic Insurance leaving nearly
15,000 Oregonians without their preferred insurance provider
Health Republic Insurance did their part. We are mad that congress reneged on their obligation and caused the failure of a public-minded regional carrier.
