The state of Illinois is planning to shut down Land of Lincoln Health, a financially struggling three-year-old health insurance co-op that was created under the Affordable Care Act.
The Illinois Department of Insurance is taking measures to shut down the health insurance co-op, which has 49,000 policy holders in Illinois, after the company suffered $90 million in losses last year. This year through May 31, Land of Lincoln Health has reportedly lost over $17 million.
Land of Lincoln Health also owes $31.8 million to the federal government for a program under the Affordable Care Act. The Illinois Insurance Department attempted to delay that payment until the company received about $73 million it says it is owed by the federal government, but the Centers for Medicare and Medicaid Services denied the request.
Land of Lincoln Health policyholders will be able to buy new health insurance plans before their coverage ends, according to the state's Insurance Department.
"It's an unfortunate day for Land of Lincoln members and for competition in the Illinois insurance market," stated Dennis O'Sullivan, a Land of Lincoln spokesperson. "It's unfortunate that CMS chose not to work with the state of Illinois as it went above and beyond with a plan to help consumers."