Insurance Commissioner Offers Assurances of WINHealth Payments

Wyoming State Insurance Commissioner Tom Glause tells WMS that Wyoming physicians will be paid.

WMS remains unclear regarding provider agreements

By Tom Lacock

The Wyoming Medical Society (WMS) met with representatives from the Wyoming Department of Insurance today in Cheyenne to discuss the evolving situation with WINhealth and seek assurances of payments for its members treating WINhealth clients.

“From the consumer standpoint, the question is ‘do I continue to have insurance,’ and the answer is yes as long as the premiums are paid,” said State Insurance Commissioner Tom Glause. “From the provider standpoint, they want to know if they are going to get paid. The answer is yes, they will get paid within terms of the policy and other regulations that are in place.”

How we got here
During Monday’s meeting with the WMS, Glause introduced WMS representatives to Joe Holloway, who is a regulatory consultant with Regulatory Services Group (RSG), Inc. out of Philadelphia. Holloway’s firm is the managing receivers of the receivership order signed last week by Judge Thomas Campbell and are essentially running WINhealth.

Concern with WINhealth has extended for quite some time. Glause said the Insurance Department was monitoring the financial health of WINhealth since before he came aboard in Jan. of 2015. He said the state insurance department required WINhealth to submit monthly financial statements to the department before changing that to weekly financial statements this spring. After the special exam by RSG this fall it was determined a change was needed.

“At that point it was apparent they needed to go into receivership,” Clause said. “Open enrollment (for the individual insurance marketplace) was approaching and we determined the most efficient way to handle this would be during the open enrollment. We wanted to be careful not to have a special enrollment period on top of open enrollment.”

Glause said Holloway’s firm is currently performing staff evaluations on the nearly 65 staffers at WINhealth and continuing to operate the company as normal as possible. He said the firm is still processing claims, and operating the company as if there were no changes, but isn’t marketing any new plans. Holloway is attempting to retain employees to continue that effort through retention bonuses, though he admits keeping employees won’t be easy. He suggested Blue Cross Blue Shield will hire on around 20 members of the current WINHealth staff through a Blue Cross job fair on Wednesday. Holloway said his group is also evaluating WINhealth staff to see if they will be able to cross train into other areas of the business.

Glause added the last time an insurance company insolvency issue took place in Wyoming was in 1992 when Old Faithful Life Insurance Company was declared insolvent. He admits there is no manual for this process and the State Insurance Department is asking for patience through the process.

Sending Cash to Providers in a Timely Manner
Glause said WINhealth is now under the control of the State Department of Insurance and it will continue to pay claims. Glause said he approved $1.9 million in claims last week and $1.1 million two weeks ago. Those checks should be in the mail already, he said.

Holloway said WINhealth is asking for some patience in the timeliness of claims payments. He said the time for turning around a claim has gone from 28 days to 40 days after a glut of claims arrived in April and were not processed through the end of April. Those have have been moved through the system and paid, but the impact has continued to be felt. This time of year after clients have met their deductible, they tend to utilize insurance more than any other period, which generally results in more claims and a slower processing time.

The receivership process is something of an interim step to allow a buyer to come forward or, in this case the WINhealth, allows the business to start to wind down before moving into liquidation. Glause said it is no secret that the Insurance Department plans to convert the receivership to liquidation sometime after the first of the year if no buyer is found. He said he believes WINheath has the money available to pay claims until that point, though he admits it will be “nip-and-tuck.”

Glause said in the receivership process the first in line to be paid is the administrator of the receivership, then policy holder claims are paid second. Providers fall into that second category, along with policy holders. Glause said WINhealth generally receives funds from premium payments at the beginning of the month and pays out its claims. He said around the 20-25th of the month federal subsidies arrive for WINhealth. Those revenue streams will continue through the end of the year. Risk corridor and re-insurance will also help to fund claims through the end of the year.

Glause said there is a projected shortfall by the end of the year and his office has already been in touch with the Wyoming Life and Health Guaranty Company. He said if the receivership is converted to a liquidation, there will be 30 days to terminate WINhealth policies and Wyoming Life and Health Guaranty will begin taking over payments to providers.

The Wyoming Life and Health Guaranty Program will act as something of a backstop for Wyoming providers in their effort to be paid. Glause said the Guaranty can make assessments and raise about $11 million for this year and then make an assessment for $22 million for 2016. Wyoming Life and Health Guaranty can use money unencumbered in 2015 for payments in 2016.

“Come Jan.1, there will be the same amount of claims coming in as there are now without the premiums or subsidies, that is likely when Guaranty association will kick in,” Glause said.

Holloway said when the guaranty takes over payments there are no differences when it comes to processing or submitting claims to WINhealth. He expected no interruption in payments once the company goes into liquidation. He added that the Guaranty does have a limit of $300,000 per life and WINhealth has reinsurance policy as well.

Glause added that it is a priority for the Insurance Department not to lose its “qualified health plan,” status by the end of the year. WMS legal counsel Nick Healey said he believes if the provider agreements are void or terminated, they would lose that status because WINhealth would not be able to meet the provider network requirements. Glause said losing the qualified health plan status would terminate all policies within 30 days. He credited Holloway’s firm with being familiar with this process (Holloway said they just performed a similar effort in California) and added that wasn’t entirely unique as co-ops and other companies are struggling since the risk corridor announcement was made.

Provider Agreements remain a concern of WMS
Among the chief concerns of the WMS is whether provider agreements are still intact between WINhealth and providers. Healey said the provider contract states failure of WIN to conform to state health maintenance organization laws including insolvency provisions will void the agreement. That would result in termination at the end of the month in which a failure is identified.

Healey said the insurance department required WINhealth to have $6.5 million net worth as stated in the commissioner’s petition to place WINhealth in receivership, and WINhealth has failed to do so, as early as June of this year. If that were accurate, the provider agreements would be void.

Holloway said in his position at WINhealth, he does have the ability to re-affirm contracts within 120 days of the order, but he didn’t think that is necessary. He added that if it gave providers assurances of payment it could be done. Glause said he believes WinHealth would be entitled to a hearing on whether it had failed to conform to the Wyoming HMO laws, and since that hadn’t happened (because the Commissioner hadn’t taken action it would entitle WINHealth to a hearing), WINHealth couldn’t be considered not to be have conformed with the HMO laws. Thus, he believes, the contracts are still valid and not void. Glause admitted he might need the Attorney General’s office to weigh in on that possibility.

“The provider agreement regulates when the claims will be paid, pre-authorization and discounts, so the question is whether the provider agreement is still in place and do providers give WINhealth the discount,” Healey asked.

Healey also asked Glause and Holloway if a provider should begin a relationship with a new patient who has WINhealth. Glause said continuity of care should not be an issue and those on the individual market already have a relationship with Blue Cross Blue Shield, which is where those on the individual market would have to buy insurance through after Jan. 1. He also said providers who are in-network would contractually not be allowed to turn away a new WINhealth patient, nor would they be able to have a WINhealth patient self-pay and turn in a receipt to WIN health after the visit.

WMS is seeking further clarification on provider agreement position. Today, Holloway reached out to the WMS and asked them for further meetings to resolve the issue in a mutually-beneficial manner.

Finding Coverage For Patients Impacted
Denise Burke, a senior policy analyst in the Department of Insurance, said went active today allowing those seeking insurance on the individual market to look at plans, but not yet purchase health insurance until the open enrollment period in November. Glause said in order to have a plan in place by Jan. 1, citizens need to have a new insurance plan bought and paid for by Dec.15.

Those who have purchased insurance through employers or in small groups will continue to maintain that insurance until the plan’s anniversary date (the date it was purchased for one year), however Holloway said WINhealth is actively marketing those plans to other carriers and has little intention to carry those contracts to term. Rather, they are trying to transition others to new plans before the company would go into liquidation and the policies terminate 30 days later.

“A lot of carriers interested in the market,” Glause said. “We are looking for to get those carriers interested in providing deductible credits so there isn’t re-setting of deductibles. That provides for transparent switch from one company to another. We are seeing companies exploring a 14-month plan that will get them on a Jan. 1 renewal for 2016.”

Glause said finding carriers interested in the large groups such as county or city staffs has been easier and the insurance department is trying to convince the carriers to also consider picking up smaller groups in the state.

Glause said he tends to feel more choices are better than fewer for Wyoming citizens and added Wyoming is a difficult place to attract carriers. He said the director of the Centers for Medicaid and Medicare has said his organization will do anything it can to help attract interested parties to the Wyoming market, but the bottom line is it still a business decision.

Assurances by WINhealth and the State Department of Insurance
When asked by Holloway for the concerns of WMS members, the conversation quickly turned to concerns about WINhealth staff available to perform pre-authorizations – especially in surgical situations. Holloway said he would make that a priority to find out more behind the slow speed of surgical pre-authorizations.

He also said the Best Life health insurance product used by Cheyenne Regional Medical Center employees is not impacted in the meantime. However, he assumes options are being looked for as the first of the year comes along. He said CRMC only funds the Best Life liability when claims are processed, but none of the Best Life funds are held by WINhealth.

Glause added that there is a dedicated email account for providers to send questions regarding the WINhealth issues at