5th Risk Corridor Massacre victim succumbs to wounds, passes away


12 days ago, private Wyoming health insurer WINhealth, in business since 1996, was among the 5 (and counting) victims of the horrific Risk Corridor Massacre, which has already taken the lives of at least 4 ACA-created CO-OP insurers:

WINhealth sent along this release saying: As of October 8, 2015, WINhealth has chosen not to participate in the individual market, to include the federal exchange, for the 2016 plan year. The decision not to participate stems from a recent announcement from the federal government regarding the risk corridor program .

According to the Centers for Medicare and Medicaid Services  CMS), “The goal of the risk corridor program is to support the Marketplaces by providing insurers with additional protection against uncertainty in claims costs during the first three years of the Marketplace. The temporary risk corridor program provides payments to insurance companies depending on how closely the premiums they charge cover their consumers’ medical costs. Issuers whose premiums exceed claims and other costs by more than a certain amount pay into the program, and insurers whose claims exceed premiums by a certain amount receive payments for their shortfall.”

This recent development  from CMS came as a surprise to WINhealth. The financial impact of the federal government’s decision on WINhealth amounts to approximately $4.4M. The ambiguity of federal government repayments, both in timeline and amount, have created an environment of uncertainty and increased risk in the individual environment. For this reason, WINhealth has chosen not to participate in the individual market for 2016.

WINhealth’s President & Chief Executive Officer , Stephen Goldstone, stated “The federal government’s decision to significantly reduce the reimbursement we would receive under the risk corridor program came as a complete surprise to WINhealth. This combined with the continuous delays in repayment has caught WINhealth flat-footed with no choice but to turn down participating in the exchange for 2016.”

Unlike the other 4 victims, WINhealth's injuries, while serious, didn't appear to be critical; while they were pulling out of the individual market, it looked like their other divisions (small group, etc.) were doing fine.

Well, so much for that; thanks to farmbellpsu in the comments for the heads up:

The Wyoming Department of Insurance has filed a petition with the First Judicial District Court in Laramie County to place WINhealth into a rehabilitation/receivership following a determination that the Wyoming insurer is financially at risk.

"This type of receivership will allow the commissioner to formally oversee WINhealth in the conservation of its assets, distribution of funds, and the further administration of its operations so that WINhealth members continue to receive the benefits of their plans," Insurance Commissioner Tom Glause said in a news release.

If the state's petition is approved by the district court, WINhealth will voluntarily surrender its Certificate of Authority to be an insurer in Wyoming. It also will suspend the sale of its health insurance plans for the remainder of 2015 and will withdraw its participation in the insurance market for 2016, according to the release.

...The commissioner will be reaching out to employers with small-group and large-group plans to advise them of their options.

Unlike the CO-OPs, which were created specifically via the ACA in the first place and which had various obstacles blocking their success from the get-go (underfunded start-ups, trying to enter an existing, mature market dominated by major players while also being restricted from using their start-up funds to even advertise properly), WINhealth is an existing, well-established private insurer which is pinning their downfall purely on the Risk Corridor disaster.