Texas places Friday Health in liquidation

Texas regulators have placed Friday Health Plans into liquidation and ordered the company to end all business in the state.

A district court in Austin found that Friday's Texas subsidiary is insolvent and had not maintained a minimum surplus of $1.4 million under state law, according to regulatory filings dated March 23.

"The continued conduct of the business of [Friday] would not he in the best interest of [Friday's] policyholders, creditors or the public," the judge wrote.

Texas Insurance Commissioner Cassie Brown has been appointed to liquidate and take possession of the company's remaining operations in the state, including all physical, financial and digital assets. Ms. Brown is also authorized to direct and manage Friday employees and terminate them at her discretion.

Law firm Cantilo & Bennett is now in control of day-to-day operations in Texas, though the state said most policies have expired. Any remaining claims will be paid by the Texas Life and Health Insurance Guaranty Association, meaning health plans in Texas could be financially impacted.

As of May 2022, Alamosa, Colo.-based Friday Health Plans had 330,000 members across seven states and an estimated $1.95 billion in 2022 revenue. In Texas specifically, the company recorded a $244 million shortfall at the end of last year.

"This development in Texas does not impact our business or operations in any other states," the company wrote on its website. "We remain committed to our mission to provide simple, high-quality, affordable and easy-to-use insurance to our growing membership."

Last fall, Texas asked Friday to leave the state's ACA marketplace for 2023 following operational challenges. The company also pulled out of the New Mexico exchange.

Friday is also laying off 98 workers in Alamosa and Denver on April 30 due to a "loss of business," according to state filings.

The company was founded in 2015 and offers individual and small group plans both on and off the exchange. In 2023, the company is offering ACA plans in Colorado, North Carolina, Georgia, Nevada and Oklahoma.

Friday's CEO is Beth Bierbower, Humana's former president of group and specialty benefits. The company's CFO is Rhonda Bagby, who was most recently vice president of finance and commercial at Bright Health. 

Copyright © 2024 Becker's Healthcare. All Rights Reserved. Privacy Policy. Cookie Policy. Linking and Reprinting Policy.


Top 40 articles from the past 6 months