HealthyCT, the nonprofit health insurer that was suspended in July from offering new policies by the Connecticut Insurance Department, will likely be liquidated by the end of the year.
In a Superior Court filing, Insurance Department Commissioner Katharine Wade wrote that further attempts to rehabilitate HealthyCT “would be futile and would substantially increase the risk of loss to the company’s creditors, policyholders, and the public.”
“The company is spending more each month for medical claims and pharmacy prescriptions than the premium it collects,” she said. “Operating expenses on top of the medical and pharmacy expenses exacerbate HealthyCT’s financial situation.”
HealthyCT lost $45 million in the first nine months of this year, and its available cash has fallen from $92 million in January to $26 million as of Nov. 30. That figure is expected to shrink to $10 million by year’s end, Wade said.
As of October, the Wallingford-based company had 30,973 customers, with approximately 7,000 expected to still be covered through group plans in January. HealthyCT’s 13,527 individual-market plans are scheduled to end Dec. 31.
As of Nov. 1, the company had 41 employees – a number expected to be reduced to 24 by year’s end, as some group plans continue into January. HealthyCT CEO Ken Lalime is expected to leave the firm on Dec. 15.
If the Insurance Department’s request to liquidate the company is granted, claims would be paid by the Connecticut Life and Health Insurance Guaranty Association; those covered by HealthyCT after Dec. 31 will need to find new insurance plans by the end of January.