North Carolina became the latest state to put Friday Health Plans in receivership, with Insurance Commissioner Mike Causey announcing his department will file a petition for receivership.
Coverage for FHP-NC’s policyholders that have health insurance through the federally facilitated exchange will end at the end of the day on Aug. 31. To ensure FHP-NC’s policyholders have an opportunity to replace their current exchange coverage before it is terminated, the North Carolina Department of Insurance has coordinated with the US Center for Consumer Information and Insurance Oversight to implement a special enrollment period for members to select another exchange health insurance plan.
The special enrollment period will begin on July 2 and end on Oct. 30. Consumers who purchased health insurance from FHP-NC through the federal exchange must choose a new exchange health insurance plan by Aug. 31 to avoid a gap in health insurance coverage.
Consumers that fail to choose a new plan by that date will still have until Oct. 30 to obtain coverage but will have a gap in coverage from the date all FHP-NC plans are terminated on Aug. 31 until the effective date of new coverage. A website to assist impacted members with the process of choosing a new exchange health insurance plan will be established with a link on the North Carolina Department of Insurance website.
Below are important dates to keep in mind:
- July 2-Special Enrollment Period Begins
- Aug. 31-Last Day to Enroll Without a Gap in Coverage
- Aug. 31-All FHP-NC Policies Are Terminated
- Oct. 30-Last Day of Special Enrollment Period
Finally, providers should continue to service all FHP-NC members and should not demand payment other than the proper cost share associated with the medical service and relevant health plan. Providers will be paid for all covered claims for services performed by Aug. 31 and will receive notification from FHP-NC in July.
FHP-NC is a subsidiary of the Friday Health Group.
Earlier this month, Friday Health announced it would cease operations by the end of the year in the seven states in which it does business. Friday covers between 300,000 and 400,000 in the states of Colorado, Georgia, Texas, Nevada, New Mexico, North Carolina and Oklahoma and employs between 300 and 400 employees, the Alamosa (Colo.) Daily Courier reported. Friday is based in Alamosa.
“Friday Health Plans has grown incredibly quickly, which is a testament to the strength of our mission of delivering affordability, simplicity and outstanding customer service,” the company said on its website. “Unfortunately, Friday has been unable to scale our financial infrastructure to match the pace of our growth and secure the additional capital required to run our business. While we are deeply disappointed, we agree with the decision of our state regulators that it is necessary to wind down Friday’s business operations over time in accordance with the regulations in the states where we are operating.”
Friday stopped offering coverage in Texas and New Mexico in November amid concerns about the increasing costs of enrolling more members.
Colorado regulators began prohibiting Friday from enrolling new members in the state last month. If Friday Health Plans cannot make it until the end of the year, the Colorado Life and Health Protection Association would step in to help members cover medical costs up to $500,000 each.
In late May, Nevada Insurance Commissioner Scott Kipper filed legal action with the Nevada District Court to place Friday Health Plans of Nevada under receivership due to growing concerns about the “reliability of Fridays. financial reporting to the Division.”
Also in May, regulators in Georgia forced Friday Health into receivership due to “reported insolvency and inability to raise additional funds from outside investors.”
Last week, Friday Health Plans of Oklahoma was placed into receivership after it was placed under the supervision of the Oklahoma Insurance Department, insurance commissioner Glen Mulready announced. In April, the North Carolina Department of Insurance placed the company in a state of “suspended suppression,” effectively barring the company from selling any more insurance.
On March 23, the Texas Department of Insurance placed Friday Health Insurance Company Inc. (Texas) into liquidation in that state. Texas Insurance Commissioner Cassie Brown was appointed to liquidate and take possession of the company.
And in November, health insurance agents who told InsuranceNewsNet that the carrier had not paid them commissions since the end of August received those payments for the months of September and October.
Friday Health was founded in 2015 when Sal Gentile and David Pinkert bought the Alamosa-based insurance company Colorado Health Plans Inc. They soon renamed the company Friday Health Plans.