Ky. co-op blames in­ad­e­quate risk-cor­ri­dors fund­ing for clo­sure

Modern Healthcare - - REGIONAL NEWS - —Bob Her­man

Ken­tucky Health Co­op­er­a­tive will end op­er­a­tions by year-end, forc­ing 51,000 Ken­tuck­ians to find new health cov­er­age dur­ing the next open-en­roll­ment pe­riod. It’s yet an­other ca­su­alty of the Af­ford­able Care Act’s po­lit­i­cally con­tentious co-op pro­gram.

A ma­jor fac­tor be­hind its demise, ac­cord­ing to the in­surer, was low pay­ments from the ACA’s risk-cor­ri­dors pro­gram, which could force more coops to close in the near fu­ture.

The law es­tab­lished the tem­po­rary risk cor­ri­dors as a way to cap win­ners and losers dur­ing the early run of the ACA’s in­sur­ance ex­pan­sion. Ear­lier this month, the CMS said it would pay only 12.6% of re­quested risk-cor­ri­dors pay­ments. For Ken­tucky Health Co­op­er­a­tive, that meant it would re­ceive only $9.7 mil­lion from its re­quest of $77 mil­lion. The co-op was col­lect­ing far less in in­sur­ance pre­mi­ums than it was pay­ing out in med­i­cal claims.

“In plainest lan­guage, things have come up short of where they need to be,” Glenn Jen­nings, Ken­tucky Health Co­op­er­a­tive’s in­terim CEO, said in a writ­ten state­ment.

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