Tennessee is the second state to publicly say it has taken control of Bright Health's financial operations.
Insurance regulators in the state filed the supervision order Nov. 4, but only made the document public on March 14. The move follows Florida recently filing an extension for its own supervision order against Bright, which revealed the state has been supervising the company since last September.
Until further notice in Tennessee, Bright is not allowed to spend more than $10,000 on anything without the state's approval and it may be required to pay for an on-site state employee to monitor its finances, along with any additional experts, actuaries and examiners that may be needed.
With the exceptions of claims payments or payroll, the company is not allowed to withdraw any funds from its bank accounts without permission, and it is banned from lending or investing any funds. It also cannot transfer any property to anyone or transfer funds to its parent company, Bright Health Group. In addition, the state can initiate liquidation or delinquency proceedings.
The state crackdowns come after a period of extreme operational challenges for Bright over the last year. In 2022, the company reported a net loss of $1.4 billion and ended its insurance business within the ACA market entirely and Medicare Advantage outside of California.
In its fourth quarter earnings call in early March, the company said it needs to raise around $300 million to stay afloat after the business overdrafted its credit — it breached its minimum liquidity requirement in the first quarter of 2023.
Bright also has operations in Alabama, Arizona, California, Colorado, Georgia, Illinois, New York, North Carolina, Ohio, South Carolina and Texas. The company ended 2022 with 1 million commercial members, 125,000 Medicare Advantage members and 530,000 value-based care consumers.