Close Close

Life Health > Health Insurance

N.Y. hospitals: Failed CO-OP owes them more than $150 million

Your article was successfully shared with the contacts you provided.

The Greater New York Hospital Association says it’s still talking to member hospitals to find out how much a failed carrier, Health Republic Insurance of New York, owes them.

But Kenneth Raske, president of the association, said last week in a letter to member hospitals that the nonprofit, member-owned Consumer Operated and Oriented Plan (CO-OP) carrier owes the hospitals at least $142 million and probably owes them more than $150 million.

New York state regulators have put the carrier in the hands of a chief restructuring officer and are planning for it to shut down Nov. 30.

The carrier said earlier this year that it had about 215,000 enrollees. If it owes about $150 million to hospitals, that would mean that it has an average of $700 in hospital claim obligations per enrollee.

The total does not include obligations to physicians or independent clinics.

The carrier owes several hospitals more than $10 million each, Raske wrote in the letter.

The association is “aggressively pursuing fair and equitable remedies with the Department of Financial Services (DFS), other state officials and the Centers for Medicare & Medicaid Services,” Raske wrote. 

The association is also seeking the creating of a health insurance guarantee fund that could retroactively help hospitals with the Health Republic receivables and protect hospitals against future hospital insolvencies, Raske wrote.

See also: What happens if health insurers fail?

“While New York health insurers remain profitable overall, several not-for-profit plans incurred losses in 2014 and bear watching going forward,” Raske wrote.

In other recent health insurer shutdowns:

  • South Carolina Health Cooperative, a multiple employer welfare association (MEWA) formed outside the Patient Protection and Affordable Care Act (PPACA) CO-OP system, had about $2,400 in total unpaid claims per enrollee when it closed.

  • CoOportunity Health, a PPACA CO-OP carrier, had about $800 in unpaid claims per enrollee when it shut down.