The Connecticut Insurance Department placed Wallingford, Conn.-based health co-op HealthyCT on an immediate order of supervision, prohibiting the insurer from selling or renewing health plans and leaving 40,000 policyholders uninsured.
Insurance Commissioner Katharine Wade announced Tuesday the co-op was in "hazardous financial standing" after HHS required HealthyCT pay $13.4 million under the Affordable Care Act's Risk Adjustment Program. The program aims to temporarily level the financial playing field for payers absorbing newly insured, costlier members.
"This is not an action that we take lightly but did so in order to immediately protect the company's 40,000 policyholders in Connecticut and make certain that their claims will be paid under the terms of their policies and for the duration of those policies," Ms. Wade said. "As regulators, consumer protection is our prime mission and an essential part of that is ensuring that carriers can honor their promises to their policyholders."
The order of supervision placed HealthyCT under Ms. Wade's oversight, requiring the insurer to submit a comprehensive payment plan for the risk adjustment payment by July 15.
Most affected policyholders will be fully covered through the end of the year, but coverage will end for 13,000 individual policyholders and 27,000 large and small employer plans next year. For HealthyCT group plans renewed on July 1, coverage will continue until June 2017. However, individuals on group plans slated for renewal on Aug. 1 will need to move to a different plan.
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