ATTENTION HEALTH REPUBLIC MEMBERS in New York!
The company is closing down for business as of Nov. 30, and members’ health insurance coverage through them will end as of that date. Current Health Republic policyholders will need to enroll in a new plan by Nov. 15 in order to have coverage in place for December. This action is being taken under order of federal and state regulators because their reserve funds are inadequate to pay claims going forward.
For information on what to do (and FAST!) and where to get help with it, here’s where to check: http://hcfany.org/alert-health-republic-to-end-coverage-on-november-30-2015/. Current members are urged to reach out to enrollment assistors (Navigators, Brokers, Application Counselors) for help with this effort. Community Health Advocates (www.communityhealthadvocates.org) is the state’s largest navigator network of non-profits across the state, and a good resource.
Health Republic was a new type of insurer authorized under the Affordable Care Act: a non-profit “health insurance co-op” operated by and for its members. During Congress’ crafting of the ACA in 2009-10, it was the alternative to the concept of a “public option” health plan that conservative Democrats could live with. The co-op idea was put forward by then-Sen. Byron Dorgan (D-ND), and ended up in the bill so that Senate Democrats could secure his vote for the ACA.
Several states went ahead with setting up these co-ops, and New York’s Health Republic was by far the largest, with over 200,000 members. Its establishment was spearheaded by the Freelancers’ Union, and they initially offered among the most affordable plans on “New York State of Health”, the state’s official health insurance marketplace created under the ACA.
After the mid-term elections of 2010, as Congress crafted federal budget deals during 2011-13, they raided the ACA’s co-op fund in order to pay for other things and reduce the overall budget deficit, and also because of general hostility to the ACA. Consequently, the monies these co-ops were expecting to help them get established was drastically slashed, and many of them have since experienced financial crises and had to close. In addition, the commercial insurance industry has worked to undercut them so as to lessen competition in the new health insurance marketplaces created under the ACA.
Health Republic is not the only co-op plan to go under because of this situation. At least 8 have now closed down, stranding over 500,000 people who enrolled in them, and some others are expected to follow. That said, there are some which, so far, are doing OK and are financially stable, for example in Connecticut.
The radio and TV program “Democracy Now featured a segment on this whole situation: http://www.democracynow.org/2015/11/3/the_co_ops_collapse_how_gop