Yesterday, the North Carolina Department of Insurance filed court papers to put the North Carolina operations of Friday Health Plan into receivership:
North Carolina Insurance Commissioner Mike Causey announced today that Friday Health Plans of North Carolina Inc. (FHP-NC) has consented to being placed into receivership to protect North Carolina policyholders due to its reported insolvency and inability to raise additional funds from outside investors.
Coverage for FHP-NC’s policyholders that have health insurance through the federally facilitated exchange will end at the end of the day on Aug. 31. To ensure FHP-NC’s policyholders have an opportunity to replace their current exchange coverage before it is terminated, the North Carolina Department of Insurance has coordinated with the US Center for Consumer Information and Insurance Oversight to implement a special enrollment period for members to select another exchange health insurance plan.
The special enrollment period will begin on July 2 and end on Oct. 30. Consumers who purchased health insurance from FHP-NC through the federal exchange must choose a new exchange health insurance plan by Aug. 31 to avoid a gap in health insurance coverage.
This is not particularly surprising. Insurance regulators are highly motivated to make sure that the companies that they regulate don’t go poof in the night. They are by nature, fundamentally cautious people who want to avoid big problems. As we talked about a few weeks ago, the process of unwinding a broken insurance company can go smoothly or roughly.
1) Limp to December 31st.
2) Mid-year termination with smooth transitions
3) Mid-year terminations with rough transitions
4) C-ya later
North Carolina is trying to do #3 as smoothly as possible. Manual re-enrollment means a lot of people will be slipping through a variety of cracks. It also means that some folks will disenroll earlier than they expected but as they should be.
Friday’s operations nationally sure look like they will be winding down mid-year in most if not all places.
** Could not figure out how to do a Skynardesque title