The Greater New York Hospital Association (GNYHA) is warning that hospitals will face $150 million in costs associated with the shutdown of Health Republic, the nation’s largest, and New York’s only Obamacare co-op.
The hospital group also suggested that other insurers under Obamacare could meet the same fate as New York’s failed co-op.
The group sent out a memo saying “This is a dire situation.”
Hospitals could face more than $150 million in costs associated with the shutdown of New York’s largest private health insurer in its exchange.
The Greater New York Hospital Association said a survey of its members estimated that bills will pile up because of the recent demise of Health Republic, a cooperative health plan that insured about 20 percent of the state’s private customers in its New York State of Health program.
“This is a dire situation,” the group said in a memo. “Several hospitals have reported Health Republic receivables of more than $10 million, and GNYHA is aggressively pursuing fair and equitable remedies with the Department of Financial Services, other state officials, and the Centers for Medicare & Medicaid Services.”
The warning signs from the hospitals are the latest among mounting concerns about the fallout from Health Republic’s struggles as it shuts down operations by Nov. 30.
Health Republic of New York had been ordered shut down by state regulators last month. The insurer’s finances were so dismal that officials announced they would have to be shut down in under two weeks leaving roughly 215,000 customers scrambling to find new, potentially less affordable plans, by November 11th. The state however, extended that deadline until the end of November, leaving their customers scrambling slightly less than they would otherwise.
Rep. Chris Gibson (R) has called for the state comptroller to investigate into what happened to Health Republic, leveling criticism at Governor Cuomo for a lack of oversight into the failed co-op.
Gibson told Time Warner Cable News that the co-op’s failure could be the start of a trend that leads to the collapse of the insurance market.
“This failure represents about 20 percent of the individuals in New York state that went to the market for insurance,” Gibson said. “If this trend continues it’s going to be destabilizing for market.”
“We need to know what happened.”
‘What happened’ to 20% of New York’s insured can happen to others across the country taking part in plans under Obamacare, according to the GNYHA.
WGRZ reports, “The group warned that other insurers in the exchange might suffer the same fate under the federal Affordable Care Act.”
Is this the beginning of the collapse Gibson was referring to?