Credit Unions Safe from Health Exchange Seize
Credit unions in Iowa and Nebraska that offered health insurance to members through a failed exchange will not experience any service interruptions, Jim Niederhauser, Iowa Credit Union League vice president of member services, told CU Times.
That's because the 46 credit unions had already transitioned to CUNA Mutual Group's new health insurance product or another provider, he said.
Not-for-profit health insurance exchange CoOportunity Health Inc., which was formed after the passage of the Affordable Care Act, was seized by the Iowa Insurance Commissioner Dec. 23 due to insufficient capital.
“We were notified by CUNA Mutual Group that they were going to enter the health insurance market and were going to use their existing TruStage model,” Niederhauser said. “We got in touch with CoOportunity Health and determined over the course of time that we would reshape the relationship we had with them.”
Over the last several months, credit unions that had partnered with CoOportunity transitioned to CUNA Mutual or to another provider, or discontinued offering health insurance to members, Andrea Dose, Iowa League member outreach coordinator, said.
No credit unions were unable to offer insurance as a result of the corrective action, she added.
“Those credit unions that had ongoing relationships with CUNA Mutual Group were able to just plug into health insurance using that TruStage model,” she said.
Niederhauser said both CUNA Mutual and CoOportunity work with insurance provider GoHealth, which made the transition even easier for participating credit unions.
Still, Niederhauser said he was shocked by the news CoOportunity was forced into a regulator rehabilitation plan.
“We were very disappointed to hear the news, because we had a great relationship with CoOportunity Health and their leadership,” he said. “Obviously, there is more to be learned, but we are very thankful CUNA Mutual entered this market so we didn't see any disruption.”
On Dec. 23, the Iowa Insurance Commissioner forced into rehabilitation CoOportunity. The firm was created following the passage of the Affordable Care Act to issue health insurance in Iowa and Nebraska.
The insurance commissioner's office said it took over management of the insurer and will either recover the business or prepare it for liquidation.
The only cooperative health insurance exchange approved by federal authorities in the two states, CoOportunity partnered with the Iowa and Nebraska credit union leagues to designate the states’ credit unions its exclusive financial institution distribution channel.