SC Co-op Consumers' Choice is Out

[miscins]

Consumers' Choice announced today that they will not offer health insurance in 2016. I'm sure we are all surprised. Unfortunately, it does leave a bit of a hole for individuals in our area that needed MUSC to be in network.

There is a press release on the SC DOI website for those interested.

 

[somarco]

South Carolina Health Cooperative was a nonprofit, member-owned MEWA formed outside the PPACA system. Because it was not classified as a health plan under South Carolina law, its members were not eligible for guaranty fund protection, Farmer says.

Failed health plan had $2,400 in unpaid claims per enrollee | LifeHealthPro

What is Consumers Choice situation?

 

[healther]

That MUSC hole is big for people around the state.

 

[RayNY]

What is Consumers Choice situation?

Compared to co-ops? Great, one of the strongest (rather, least weak)

Compared to existing carriers? On track to spend a million more in claims than collected in premium, draining about 2% of reserves. Can certainly survive in the short term, but isn't doing so well right now.

 

[AllenChicago]

What is Consumers Choice situation?

Here is a statement recently posted to the Consumers' Choice website:
2016 Important Message | CCHPSC

 

[somarco]

The question about Consumers concerned their filing status. MEWA (not subject to guaranty fund) or insurance carrier.

It apparently is a carrier per the DOI release

 

[Ron Van D]

PJTV - Trifecta

 

[Post Quartermaster]

The question about Consumers concerned their filing status. MEWA (not subject to guaranty fund) or insurance carrier.

It apparently is a carrier per the DOI release

The SC Health Cooperative MEWA is a different entity that went down last year. Most of the SC agent community saw that timebomb coming from miles away....


Consumers Choice Health Plan is an ACA co-op. They decided yesterday to not offer plans for 2016. Looks to be a fairly orderly runoff (I hope). Upper management also ran the TN co-op.


You have to give Republicans credit, they are sticking to their plan of "if we cannot repeal it, we will take it down piece by piece".....this is a direct result of the reinsurance changes passed in CROMNIBUS last December.....

 

[RayNY]

To be fair, CROMNIBUS just codified the verbiage to make the risk corridor work as described- budget neutral indemnification of losses funded by excess profit based on MLR.

If left as it was, the same thing would have happened, unless they somehow pulled a lot of money from thin air. There was no mechanism to cover excess payments due, and it was clearly going to have a massive shortfall (<5% of insurers expected to pay in, the rest expected a payment).

Expect to see 20-40% rate increase requests next year when this program, and the reinsurance program, will no longer be available (both end in 2016)

 

[Post Quartermaster]

To be fair, CROMNIBUS just codified the verbiage to make the risk corridor work as described- budget neutral indemnification of losses funded by excess profit based on MLR.

If left as it was, the same thing would have happened, unless they somehow pulled a lot of money from thin air. There was no mechanism to cover excess payments due, and it was clearly going to have a massive shortfall (<5% of insurers expected to pay in, the rest expected a payment).

Expect to see 20-40% rate increase requests next year when this program, and the reinsurance program, will no longer be available (both end in 2016)

CMS is a big agency, and by all accounts I've heard, were prepared to move some $$$'s around to make things work. Of course, CROMNIBUS made that unworkable. Though it was certainly hoped by the administration to be a revenue neutral mechanism, that constraint wasn't black and white until CROMNIBUS made it so.....