The New York State Department of Financial Services (DFS) announced that it has commenced a liquidation proceeding for the failed insurance cooperative Health Republic.
The New York State Supreme Court will supervise the liquidation proceeding, with the DFS superintendent serving as the court-appointed liquidator of Health Republic.
The superintendent will develop and file with the court a liquidation plan that maximizes distributions to claimants in accordance with statutory requirements, while minimizing the duration and cost of the liquidation proceeding, to the extent possible.
DFS said providers should continue to submit any outstanding claims against Health Republic in accordance with the procedures and deadlines set forth in the contracts that governed their provision of care to Health Republic members. Claims previously submitted do not need to be re-submitted.
Consumers who paid for covered services out-of-pocket and are owed money by Health Republic can find additional information at www.HealthRepublicNY.org.
DFS said the amount of assets available to satisfy the outstanding claims against Health Republic won’t be known for some time given claims that the liquidator may have against third parties, including as to the “3R” payments Health Republic had expected to receive from the federal government.
The 3R programs – risk adjustment, reinsurance and risk corridors – were established by the federal government specifically to help protect health insurance companies, like Health Republic, from larger-than-expected losses during the first few years of operation.
In addition, the liquidator will pursue, under the supervision of the court, any available third party claims and legal actions that may be warranted.
DFS said the total amount of Health Republic’s liabilities will likely not be known for some time after all claims have been submitted and the liquidator has completed the review of Health Republic’s books and records.
The liquidation plan will establish court-approved procedures for the review and payment of claims against Health Republic, in accordance with statutory priorities.
DFS said that consistent with other liquidation proceedings, no payments will be made until the liquidator has a clear picture of the total amount of assets available for distribution and the total amount of valid claims made against Health Republic.
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