Moda Health restricted from issuing Alaska policies

One of Alaska’s two primary insurers offering individual health plans has been restricted from continuing business in the state.

On Jan. 28 the Alaska Division of Insurance announced it was limiting the business practices of Moda Health Plan, issuing a termination of impairment against the company.

The division took this action to protect consumers after learning Moda has been experiencing “significant financial difficulties.” These include large operating losses, and inadequate capital and surplus compared to the company’s liabilities.

Alaskans with Moda policies can continue to access health care services. However, the company can no longer renew or issue new policies in the state. During the transition, the ADI will ensure claims are paid and consumers are protected.

In a press release, the division explained it took the action in tandem with the Oregon Department of Consumer and Business Services, which issued an order of immediate supervision over the Oregon-based insurer.

The order of supervision allows Oregon’s department to have a representative on site and in control of all financial decisions to ensure that consumers are protected. The order prohibits Moda from issuing new policies or renewing current policies, and requires the company to obtain sufficient capital and present a business plan to the state that demonstrates it can continue to operate.

ADI will closely monitor and work with Moda to ensure the company can continue to serve its current customers and pay claims. The division also will facilitate a plan to transfer Moda’s individual policyholders to another carrier.

The Affordable Care Act has contributed to losses by health insurers in 2014 and 2015, given the challenges with predicting claims costs for the first two years of its rollout. Lower than expected federal reimbursements have also affected some of Alaska’s insurers.

ADI reports that remaining Alaska health insurers – Premera Blue Cross Blue Shield of Alaska and Celtic Insurance Company – are currently meeting regulatory standards for solvency, and the division will continue to monitor their financial health.

Any financial assistance being received to help pay for individual insurance plans will not be

affected by this order, though those who have selected Moda for coverage in 2016 but switch to another carrier or plan may be affected.

Those looking for more information can contact the health insurance marketplace online at http://www.HealthCare.gov or call (800) 318-2596. Its call center is open 24 hours a day, seven days a week.

People may also contact ADI Consumer Services at 907-269-7900 or 1-800-INSURAK, or by email at insurance@alaska.gov. Affected consumers may also want to contact Moda Health Plan at 877-605-3229 or by email at http://www.modahealth.com/members/contact.html.

As the ADI office has been receiving a large number of calls since the announcement, it has posted a FAQ on its site answering commonly asked questions. Moda was unable to respond by press time Tuesday, and has not released any public comment responding to the two states’ decisions.