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September 30, 2016 at 12:46 PM
The National Association of Insurance Commissioners is fighting to keep state insurance regulators in charge of which parties get paid first when federally financed health insurers fail.
The leaders of the Kansas City, Missouri-based group have written to congressional leaders to ask them to ensure that the U.S. Department of Health and Human Services lets states determine which creditors come first in the line for the assets of insolvent Consumer Operated and Oriented Plan carriers.
Related: Illinois moves to put Land of Lincoln Mutual in rehabilitation
The drafters put CO-OP carrier startup loan funding in the Affordable Care Act in an effort to increase the level of competition in the private health insurance market.
Rigid CO-OP restrictions, sudden ACA program changes, fierce competition and bad CO-OP management decisions hurt the CO-OPs. More than half have already failed, and many of the surviving CO-OPs have been losing money.
Some CO-OP managers and state regulators have said that the Centers for Medicare & Medicaid Services (CMS), the HHS agency in charge of the CO-OP program, has tried to get back startup loan money before CO-OP liquidators have paid the enrollees’ medical bills.
CMS officials have assured members of Congress during congressional hearings that they are making aggressive efforts to recoup as much CO-OP loan money as possible.
