A long-term health plan for about 6,000 mostly elderly people — 3,000 of them on Long Island — is going out of business, forcing its members to find new insurers for their care at home and in nursing facilities.
Citing mounting losses, the North Shore LIJ Health Plan Inc., a nonprofit founded in 2013 by Northwell Health, said it will end its Medicaid managed long term care (MLTC) plan. The date is not set, and members’ coverage will continue as they transition to new plans, said Richard Miller, senior vice president for managed care and deputy chief financial officer at Northwell Health.
The announcement came the week after CareConnect, Northwell Health’s insurance subsidiary, said it would shut down and withdraw from the state insurance market in 2018. The East Hills-based insurer — which has about 120,000 policyholders, both individuals and group accounts — said it was closing in part because of uncertainty about the Affordable Care Act’s future.
Miller said the timetable for ending MLTC coverage will be decided after the state Department of Health completes its review of the company’s exit plan.
Of the total covered, 1,843 members are in Nassau and 1,171 are in Suffolk. Others live in Westchester County, Queens, Brooklyn and Staten Island.
Its 130 employees were sent 90-day notice of possible layoffs to come in November, although the transition could extend beyond that time frame, Miller said. Employees will be assisted in finding other jobs in the Northwell Health system or with other insurers.
“Obviously, this is not a step we wanted to take,” Miller said. “We believe we have to take this step and we have every intent to take care of our members and transition them to other plans in a way that minimizes disruption to them.”
As for CareConnect, Miller said its withdrawal plan will be submitted to the state Department of Financial Services.
MLTC plans provide insurance coverage for people to get help from home health aides with daily activities in their homes, and nursing home care when that becomes necessary.
Finding a new insurer may not be easy for some of those losing coverage. Agencies that provide direct care are concerned about narrowed access to long-term care once an insurer exits a market, said Matthew Hetterich, a corporate director of Utopia Home Care in Kings Park.
Hetterich is president of the Long Island Chapter of the New York State Association of Health Care Providers, an advocacy group that represents more than 30 licensed agencies on the Island and thousands of patients.
Some of the 11 other insurers providing managed long-term care plans on Long Island — two are in Nassau only — are not accepting new members or have months-long waits to enroll new members, Hetterich said.
“Other plans in the area have indicated they are not accepting new MLTC cases or transfers, along with not having sufficient RN staff to enroll the influx of cases,” he said.
After another area insurer announced last year it would exit the MLTC market, many clients ended up with reduced hours of care when they went to other plans, he said.
The plan expects to lose $20 million this year on top of $12 million in losses in 2016, Miller said. More members than anticipated went into nursing homes, accounting for some of the higher costs that led to mounting losses, he said.
Hetterich said it could be months before North Shore LIJ’s MLTC plan members transition into new coverage and there is no guarantee that current levels of care will be maintained.
“I spoke to another large MLTC plan last week about taking over some of our existing Northwell cases,” he said, and was told they “did not have the capacity to accept the amount of cases and they were only seeing April transfers now,” which translates into a three- to four-month delay. “The remaining plans are also indicating similar wait times for new enrollees, as well as transfers.”
Northwell’s MLTC plan will continue as usual through the transition period, Miller said.
“We are working with the state Department of Health to ensure there is no interruption with the level of care for our members,” he said.