Patients, other policyholders and providers will have to wait to see how much of their bills failed Ky. Health Cooperative will pay

The co-op’s headquarters in Louisville still bears its name.

Thousands of patients and thousands of providers will have to wait until Oct. 15 or later to find out how much of their medical bills sent to the failed Kentucky Health Cooperative will be paid.

The state Department of Insurance, which is wrapping up the non-profit insurer’s affairs, says it has received about 2,000 “proof of claim” forms. Spokeswoman Ronda Sloan said the forms were filed by policyholders and providers, but she did not provide a breakdown. “Processing has just begun and no dollar amount is available at this time,” she wrote in an email.

The co-op “left thousands of providers waiting for payment,” Stephanie Armour reports for The Wall Street Journal. It covered about 51,000 people through the end of 2015. Franklin Circuit Judge Phillip Shepherd will decide how much will be paid to whom.

Asked how many dollars will be available to pay claims, Sloan wrote, “We are waiting on decisions regarding possible reinsurance and additional risk-corridor funds. We will be able to release a more complete picture of available assets once those issues are resolved.”

Risk-corridor funds are federal subsidies for insurers who wound up with a costlier group of policyholders under the federal health-reform law. Co-op officials said they were forced to close because Congress drastically cut the funds, a move for which Florida Sen. Marco Rubio is taking credit in his presidential campaign though the final arbiter was Kentucky Sen. Mitch McConnell, the majority leader.

The co-op was one of 23 created under the law to provide competition for for-profit insurers; 12 have failed. The others are in Arizona, Colorado, Iowa, Louisiana, Michigan, Nevada, New York, Oregon, South Carolina, Tennessee and Utah. The Oregon insurer has filed a class-action lawsuit seeking risk-corridor money, which could help other co-ops, Nick Budnick of the Portland Tribune reports.

“Experts and analysts have said the ACA’s co-ops faced multiple barriers to success being new entrants to health insurance,” notes Bob Herman of Modern Healthcare. “They had to build networks of hospitals and doctors from scratch while competing with large carriers with well-known brands and more financial resources. They also faced several political hurdles, including severe restrictions on their loans, reduced initial funding and major stonewalling from Congress.

The Centers for Medicare and Medicaid Services “said almost three-quarters of consumers in shuttered co-ops moved to a new marketplace plan in 2016,” Herman reports. Co-op policyholders had until Feb. 28 to find another plan.

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