Feds investigating if Sentara's payer arm unfairly increased premiums

The Justice Department is investigating whether Norfolk, Va.-based Sentara Health's insurance arm unfairly increased premiums in 2018 and 2019 as it received more than $655 million in federal subsidies, The Virginian-Pilot reported April 9. 

Optima Health, now known as Sentara Health Plans, announced in 2017 that it was increasing 2018 premiums in Hampton Roads, Va., by an average of 81% for individual plans, according to the report. Anthem Blue Cross Blue Shield left the marketplace for the 2018 ACA open enrollment period, leaving Optima as the only option. 

In March, a federal judge ordered Optima President and CEO Michael Dudley and Optima chief actuary James Juillerat to provide additional testimony within 60 days, according to the report. The Justice Department alleged that while Sentara has complied with some requests for documents and testimony, it has refused to comply with others. The judge's ruling compels Sentara to provide the documents and testimony. 

A Sentara spokesperson told the news outlet that the health system has diligently worked with investigators and has provided more than 27,000 documents and 70 hours of interviews from current and former employees. The spokesperson said that Sentara decided to enter the market after Anthem left in 2017 and they had only 26 days to formulate insurance plans. The spokesperson said that had Sentara not stepped up, 350,000 Virginians were at risk of not having access to an ACA-eligible plan. 

The spokesperson told The Virginian-Pilot that the rates were "verified by a leading independent actuarial firm and approved twice by Virginia regulators."     

The investigation has been ongoing since 2021, according to the report. 

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