Connecticut’s financially “unstable” Obamacare health-insurance co-op was placed under state supervision on Tuesday, as regulators said 40,000 people covered by the company will ultimately have to find new plans for the coming year.HealthyCT is the 14th of 23 original Obamacare co-ops to fail since they began selling health plans on government-run Affordable Care Act insurance exchanges. Several of the other remaining co-ops, at least, are believed to be on shaky financial ground.
Until last week, the nonprofit HealthyCT had “adequate capital and sustainable liquidity” — but that fell apart Thursday with a federal requirement that hit HealthyCT with a $13.4 million bill, according to the Connecticut Insurance Department.
State Insurance Commissioner Katharine Wade said that the resulting “hazardous financial standing” of HealthyCT led her to place the co-op under supervision, which prevents the company from writing any new policies, and also from renewing any large or smaller employer plans that expire after last Friday.
The co-op covers about 13,000 people on plans sold on Connecticut’s Obamacare exchange, who represent about 10 percent of all the Obamacare plans sold in the Nutmeg State. And another 27,000 people are covered by HealthyCT through large and small employer plans.
I’m not sure how an insurance company can be described as having “adequate capital and sustainable liquidity” “until last week”, when it had to know that it owed $13.4 million to the federal government’s “spread the risk” fund, but that’s a quibble: no one believes this stuff anymore, anyway.
Which is not to say there’s anything to cheer about here, because there really has to be a way to provide affordable insurance to people of modest means. My own two daughters are participants in Oregon’s and Maine’s programs, respectively, and I worry that those, too will fail (Oregon’s is definitely in trouble, not sure about Maine’s). Several doctors in the Portland area have established a fee structure that offers unlimited care at the GP level, with generic prescription drugs sold at cost – usually $3, for $50 a month. Great idea, great doctors, but for the plan to really work, patients should also purchase a catastrophic illness policy with, say, a $5,000 deductible, just in case.
ObamaCare prohibits those policies.