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Julia Hutchin

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‘Risk-corridor’ woes threaten more than co-ops


It looked safe but wasn’t.

Shortfalls in the Feds’ “risk-corridor” program, meant to cut the financial risk of health plans on Affordable Care Act insurance exchanges by collecting funds from insurers doing a better exchange business and sharing the money with less successful ones, is not only famously hurting co-ops created under the ACA.

The government has said that it could pay  only a small portion of what it owed in risk-corridor program payments.

But while co-ops have received most of the publicity about risk-corridor woes, small  plans of all types are likely to face losses, Colorado HealthOP CEO Julia Hutchins told LifeHealthPro, linked here.

An example is a provider-owned health maintenance organization WINhealth, which has said it will  quit Wyoming’s exchange in 2016 in part because of the uncertain status of its risk-corridor payments, LifeHealthPro reported.

Another example: When Pittsburgh-based Highmark Health announced losses in April, it cited negative results from selling Affordable Care Act health plans and uncertainty about the collectability of risk-corridor payments. So — not being confident about  recouping the $155 million it was owed through the program — it took an “appropriately conservative accounting approach” concerning the payments.


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