They're demanding the $180 million they were promised.
Robert Gootee, Moda's chief executive, said his company never would have jumped so aggressively into the new markets created by the Affordable Care Act if it knew the federal government was going to renege on its obligations.
Bob, if you believed the government was going to keep its promises, you should have talked to the Navajo.
It's kind of interesting that of the three suits thus filed, two involve Oregon-based companies - Moda and Health Republic. The latter was a health insurance co-op that lasted about a year. They claim they went belly-up because the feds didn't send them the money they'd planned for.
Moda's parent company was forced this spring to sell off assets and borrow additional funds in order to replenish its depleted capital reserves. Oregon's Department of Consumer and Business Services took Moda into supervision in January.
Moda staved off being put into receivership only after raising more than $165 million this spring.
It rather looks as though Oregonians in the health insurance biz have a couple of problems: gullibility and lack of fiscal common sense. But it's all the fault of the doggone Republicans (as usual). Never mind that Democratics passed Obamacare in the dead of night on a strictly party-line set of votes without even reading the bill. Not one Republican voted in favor. And that's in large part why Republicans presently control both the House and the Senate; people don't like being scammed and crammed. But the failures of these companies is all because of those Evil Republicans:
Midway through 2015, it became apparent to Moda officials they had a problem. Their new customers, many of whom had been uninsured for years due to pre-existing conditions, proved far sicker and more expensive than Moda had anticipated. The high claims volume led to punishing financial losses in 2015.
But Moda's issues were just beginning.
Executives didn't realize until October that Congressional Republicans had managed to quietly kill off the Risk Corridor program. They inserted a provision into a 2014 spending bill that ended up limiting the payments.
Led by Sen. Marco Rubio, the Republicans claimed credit for averting a $2.5 billion taxpayer bailout of the insurance industry and pounding a stake into the heart of the Affordable Care Act.
Instead of the $191 million it was counting on, Moda received just $11.2 million.
And what did they expect? When Democratics ram bills like this through, expecting taxpayers to pick up the tab even as those taxpayers find themselves incurring skyrocketing insurance premiums and out-of-pocket costs, nothing good can come of it. And when people get burned, they turn to Republicans.
"This plan will reduce your health care costs by $2500 a year".
"But if you like your plan, you can keep your plan".
"If you like your doctor, you can keep your doctor".
The lies were repeated over and over before they rammed the bill through, and anybody with half a brain knew they were lies. If the leaders of these health insurance companies didn't think they were being lied to, they certainly have no business trying to run these companies. What the Republicans did was prevent taxpayers from having to bail them out when the inevitable occurred.
Moda is a much smaller company in the wake of its financial crisis. It has pulled out of Washington and California and has stopped offering individual policies in Alaska. In Oregon, has limited enrollment and cut back its provider network, which the company says will likely result in enrollment plunging from around 100,000 in 2015 to an estimated 30,000 in 2017.
Life is a lemon and I want my money back.