TRENTON — A government-funded health insurance company launched to create more competition in the Obamacare marketplace is financially insolvent and will not make a comeback, state Department of Banking and Insurance Commissioner Richard Badolato announced Friday.
Health Republic Insurance of New Jersey served its 35,000 customers through the end of 2016, as promised, and the department assisted the 26,000 customers covered by individual policies in finding a new insurance carrier in time for 2017, Badolato’s statement said.
The remaining 9,000 former Health Republic customers had purchased policies through the small employer market who were not facing an open enrollment deadline, according to the announcement.
Another N.J. insurance company drops out of Obamacare
Horizon Blue Cross Blue Shield of New Jersey and AmeriHealth continue to write insurance policies for Obamacare.
Medical providers, such as doctors and hospitals, continue to be paid, the commissioner’s statement said.
But what was announced in September as a “rehabilitation” plan for the four-year-old start-up is now a liquidation plan, requiring the state to squeeze out whatever money is left to satisfy debts, Badolato said.
A state Superior Court judge approved the liquidation plan Friday, Badolato’s statement said.
Health Republic started writing health insurance policies in 2014, as the health exchange created under the Affordable Care Act was launched. The co-op got its start with $107 million loan through the landmark health care law, in an effort to create competition.
In the first quarter of 2016, Health Republic held a 7.34 percent share in the state’s Individual Health Coverage market and a 2.1 percent market share in the Small Employer Health market.
The company still owes $46.3 million, according to the commissioner’s announcement.
A Health Republic spokeswoman declined to comment.
What happened to Health Republic has been seen across the country. More than half of these nonprofit co-ops (or consumer-operated and oriented programs) have folded, crippled by higher than anticipated expenses and the financial requirements of the landmark health care law.
The future of Obamacare is in doubt under President Trump’s administration and a Republican-controlled Congress — both of which have vowed to repeal the law.
Susan K. Livio may be reached at slivio@njadvancemedia.com. Follow her on Twitter @SusanKLivio. Find NJ.com Politics on Facebook.
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