The S.C. Department of Insurance and the South Carolina Alliance of Health Plans will stage events this week to help small businesses affected by the failure of the South Carolina Health Cooperative match up with other insurers and maintain coverage.
The state agency last week revealed serious problems with the cooperative, which offered self-funded health benefits to more than 500 small businesses in the state. The letters of credit used to back the payment of claims for the cooperative were deemed fraudulent.
That left about 4,600 employees of small businesses in danger of being responsible for their own medical bills. The state agency worked to find alternative insurance choices.
As of Monday, four carriers – BlueChoice HealthPlan, BlueCross BlueShield of South Carolina, Coventry and United Healthcare – had been approved to write small group policies for former South Carolina Health Cooperative members. The coverage would be effective as of Dec. 1 if policies are in place by Dec. 12.
“We are pleased to see the continued outpouring of support offered by both the industry and community alike as we work to locate coverage for the South Carolinians impacted by this issue,” said Ray Farmer, director of the state insurance agency.
The S.C. Alliance of Health Plans will stage several health insurance fairs for the impacted small businesses, including:
The South Carolina Health Cooperative, based in Seneca, was licensed as a Multiple Employer Welfare Arrangement in June 2012. A MEWA allows a group of employers to pool their contributions in a self-funded health plan for their employees. Claims liabilities are borne by the employer members and, as with any self-funded plan, there is no guaranty fund protection.