More companies likely to join Iowa insurance marketplace

DES MOINES - Iowa's insurance commissioner said Thursday he expects as many as three health insurance companies to join the marketplace where people can purchase subsidized health insurance under the federal health care law.

At present, only one company sells health insurance in the marketplace.

Nick Gerhart, testifying before an Iowa Senate panel Thursday, said he has talked to CEOs of two health insurance companies, and he expects as many as three soon will apply to enter the marketplace. Gerhart said he was 'not at liberty” to identify the companies.

With the recent financial troubles and pending liquidation of CoOportunity Health, Iowa has only one insurer, Coventry Health Care, selling marketplace plans statewide.

'We are in discussions right now with carriers that are very seriously looking at entering the exchange,” Gerhart told state lawmakers. 'I do believe very strongly that there's going to be at least one or two, maybe three carriers that are going to file.”

Wellmark Blue Cross and Blue Shield is the state's largest insurer, and it so far has declined to enter the marketplace. Asked Thursday about its plans, the company said it is 'evaluating future exchange participation based on what is in the best interest of our members.”

Companies have until an April 15 federal deadline to submit an application, but Gerhart thinks that deadline could be extended.

'I do think there are going to be other carriers that are going to go in (the marketplace),” Gerhart said. 'I think that will happen.”

Proponents of the health care law say more competition in the marketplace will hold down costs.

CoOportunity was created out of the federal health care law to provide that kind of competition, and it received $146 million in federal funding. At its peak, it had roughly 120,000 customers in Iowa and Nebraska. Most were in Nebraska.

The state took control of the company in December, saying it was in financial peril. Last month, the state determined the company could not be salvaged and called for its liquidation. That must be approved by a Polk County court.

In an interview with the Quad-City Times on Thursday, Gerhart said the company had a three-part financing strategy to deal with a liquidity crisis. The company received $32.7 million in September and sought $55 million from the Centers for Medicare and Medicaid Services, which had begun a new round of financing. The third part of the plan, he said, was to obtain private financing. Gerhart said the company was seeking $40 million in private loans.

CMS did not grant a loan. Gerhart said he thought CoOportunity had a solid plan to get private financing but that it would be 'incredibly difficult” to get it without CMS funding.