Although the following chain of events directly affects some 120,000 health insurance policyholders residing in the states of Nebraska and Iowa, it could be a bell weather for individuals residing in one of the other 23 states that have/offer health insurance through a federal government approved/funded, non-profit, member owned health insurer. (see http://sstevenshealthcare.blogspot.com/2014/12/coop-health-insurancealert.html for the states currently offering health insurance through a government funded/approved COOP).
March
23, 2010 – The Patient Protection and Affordable Care Act (PPACA) is
signed into law by the President.
Section 1322 of PPACA includes a provision allowing for the
establishment of “consumer operated and oriented plans”, or COOPs.
January,
2012 – CoOportunity Health is founded as a non-profit, 501c(3)
entity in Iowa, led by former Wellmark/Blue Cross Blue Shield executives.
February,
2012 – The Centers for Medicare and Medicaid Services (CMS)
approves CoOportunity Health, along with 22 other COOPs in 23 states around the
country. CoOportunity Health receives initial, low
interest loans from the U.S. government totaling $112.6 million. (Note: the loan included a 15 year payback,
and an initial interest rate under 0.4% on the solvency portion, and a 5 year
payback time frame on the initial start up portion.) This initial amount was
divided/used as follows: $14.7 million for initial operations; $98 million as
operating capital, meeting insurance department solvency and surplus to premium
requirements. (Note: according to the
Omaha World Herald; Money & Jobs; December 28, 2014 article, the initial
operating capital allocation was $15.4 million and $130.6 million in solvency
funds, respectively.)
October,
2013 – CoOportunity Health is officially open for business in the
states of Iowa and Nebraska, and begins enrolling members, both on and off the
federal health insurance exchange, individual and employer group coverage.
January
1, 2014 – The earliest allowable effective dates of issued coverage.
Q2, Q3, 2014 – CoOportunity Health realizes significant growth,
reaching 5,000 covered members by Q2, 89,000 members in Q3, and 120,000 members
by early Q4.
November
1, 2014 – 2015 open enrollment begins (concludes 2/15/15)
December
13, 2014 – The $1.1 trillion Budget Reconciliation Act (or CRomnibus
Bill) is passed by Congress. One of the
provisions of the bill eliminates anticipated funding for the 24 COOPs,
including CoOp Health. As a result, $60
million of CoOp Health’s anticipated, additional $125.6 million of government
funding was eliminated, placing them at risk. (Note: the Iowa Department of Insurance allowed CoOp Health to include
the $125.6 million on its balance sheet as an asset.)
December
23, 2014 – The Iowa Insurance Commissioner submits a petition for an
“order of rehabilitation”, ceasing any new business activity from that point
forward. Within an issued statement, the
commissioner says – “…people who signed up for the first time with CoOportunity
Health after December 15, 2014 will not have coverage and should find other
insurers”.
January
7, 2015 – The Iowa Department of Insurance issues guidance strongly
encouraging agents and brokers to “explore other coverage options for
individuals and groups”. The guidance
also outlines the possibility of CoOp Health’s status changing to
“liquidation”. In such an event, insured
groups would be terminated 45 days after a liquidation order is issued. Affected terminated members would have the
option of filing claims through the state guarantee fund, which has a $500,000
per member limit on medical and pharmacy claims.
January
23, 2015 – The Iowa Department of Insurance announces its intent to
file a petition with the court for liquidation.
The insurance commissioner indicates that “there is no expectation for
additional cash inflow until the second half of 2015 and medical claims
currently exceed cash on hand”. It is
anticipated that a hearing will take place in February (2015), and the order to
liquidate CoOportunity Health will commence on February 28, 2015.
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