Home Business Alamosa News | About 5,000 people will have an insurance gap after Friday Health’s collapse in Colorado

Alamosa News | About 5,000 people will have an insurance gap after Friday Health’s collapse in Colorado

by Cedric Guzman

The shutdown of Friday Health Plans in Colorado this summer has left thousands of customers without insurance. State regulators allowed those affected to buy new plans through a special enrollment period, but about a quarter of the company’s customers did not choose a new plan before the deadline, leaving about 5,000 people uninsured for at least a month. However, there is still time for these customers to take action, as the special enrollment period is still open until the end of the year.

Kevin Patterson, CEO of Connect for Health Colorado, the state’s health insurance exchange, assured customers that it is not too late to choose a new plan and that they are ready to help. Enrolling this month will ensure coverage beginning on October 1, while enrolling in October will provide coverage starting on November 1. However, even a few weeks without coverage can result in costly medical expenses, as injuries and illnesses during that period may not be covered.

It seems that Friday Health customers in Colorado have been slower to choose new insurance compared to other states. In North Carolina, 97 percent of the company’s customers bought a new plan before their coverage expired, while in Colorado, only about 76 percent re-enrolled before the initial deadline. Oklahoma and Nevada had re-enrollment rates of about 60 and 70 percent, respectively. The re-enrollment rate for Georgia was not disclosed due to data privacy concerns.

Mike Rhoads, a deputy commissioner with the Oklahoma Insurance Department, suggested that some consumers were discouraged from switching because it could bring new costs, such as starting over on deductibles. Switching plans may also require choosing new doctors and other hassles. In Colorado, only Kaiser Permanente and Denver Health Medical Plan have offered to honor the deductibles of Friday Health plans, while others have refused. This has caused additional costs for customers like Lauren Gibbs, a real estate agent in Lakewood, who had to cut back on healthcare due to the lost deductible.

Colorado insurance officials made efforts to reach out to affected customers through email, letters, and enlisting the help of insurance brokers to spread the word. However, the reasons why thousands of Colorado customers have not purchased new insurance are unclear. Friday Health was one of two insurance options for some southeast Colorado counties, according to Patterson. The demographic data on the newly uninsured is not yet available.

Friday Health closed down in Colorado and four other states due to worsening financial concerns and fears that doctors would stop accepting the company’s plans. Critics have said that Friday Health, like Bright HealthCare before it, set competitive premiums to attract customers but grew too fast and could not keep up with the costs of coverage. Colorado placed Friday Health into receivership, taking command of its state-based business, after which the company’s national leadership laid off all its staff and left the management and administration to state regulators.

The state will continue to operate the remaining claims and business affairs of Friday Health until they are settled, which could take years. The shutdown may also create financial challenges for other companies and customers, as they may be responsible for costs beyond Friday Health’s remaining financial resources. The state’s Guaranty Association, funded by other insurers, may have to pay toward those costs. Customers who paid deductibles to Friday Health only to have their progress wiped away can file claims against the company’s estate to recover some of their losses.

Real estate agent Lauren Gibbs, who was affected by the shutdowns of both Bright and Friday Health, now hopes for bigger reforms in the healthcare system, including possibly a true public option. She believes that these collapses highlight the need for attention and reform from state regulators and the governor, as real people’s lives and health are at stake.

Overall, the shutdown of Friday Health Plans in Colorado has left thousands of customers without insurance, and efforts are being made to ensure they enroll in new plans during the special enrollment period. The reasons for the slow re-enrollment in Colorado compared to other states are unclear, but insurance officials are working to assist affected customers and address the financial implications of the shutdown.

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