Failure of New York co-op could cost hospitals $200M
The failure of the New York insurance co-op Health Republic Insurance has left hospitals and other providers with about $200 million in unpaid bills, the Associated Press has reported.
Members of the provider community testified in front of New York state lawmakers earlier this week, and asked them for some form of financial relief. The Greater New York Hospital Association (GNYHA) has proposed establishing a guaranty fund that would be financed through assessments on other insurers. Health Republic owed hospitals about $165 million through October, and expected that total to rise dramatically, according to the GNYHA.
"We'll see if the governor's going to do anything with regard to making up the immense shortfalls. That would be a part of the budget process," Senate Health Committee Chairman Kemp Hannon told the AP.
Health Republic announced last fall that it would cease operations at the start of this year due to ongoing financial difficulties. It is among many co-op insurers that have been battling to sign up enrollees and remain afloat. A report issued by the U.S. Department of Health and Human Services' Office of Inspector General found that all 23 of the nation's co-ops had fallen short of enrollment and financial projections.
A report by a New York non-profit, the Empire Center, concluded that poor regulatory oversight led to Health Republic's demise. A specific example: the state Department of Financial Services cut the premiums Health Republic could charge at a time when it was aware it was flailing financially. That report suggested that state regulators decided to pursue the politically palatable route of keeping premiums down in the short-term without assessing the impact to consumers and the provider community over the long-term.
To learn more:
- read the AP article via The Charlotte Observer
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