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Chartered Health Plan’s Rehabilitator Files Third Status Report With Court; Will Field Questions Today

Friday, April 19, 2013

Chartered Health Plan’s Rehabilitator Files Third Status Report With Court; Will Field Questions Today

The Department of Insurance, Securities and Banking will hold a teleconference at 1 pm today, April 19, open to the public but at which only reporters may ask questions. For the number, call the department’s Tanya Bryant at (202) 442-7761.

The rehabilitator of DC Chartered Health Plan Inc., which manages health care for more than 100,000 of the District’s poorest residents, issued this statement:

The rehabilitator today filed a status report with the District of Columbia Superior Court on Chartered’s financial condition as its Medicaid contract is scheduled to end April 30.  Large losses in 2012 and 2011 have depleted the company’s cash reserves, forcing suspension of payments to medical providers effective April 19.

Almost all the company’s remaining assets are illiquid or unavailable to pay providers; these assets are primarily contract claims against the District over reimbursement issues; and assets securing a loan taken by Chartered’s parent company, DC Healthcare Systems Inc. The rehabilitator has reported to the court over the past few months that recoveries on the contract claims and the collateral securing the loan are critical for Chartered to satisfy its liabilities.

Chartered received court approval March 1 to sell certain of its assets to AmeriHealth, a leading managed-care company headquartered in Philadelphia.  The transaction is scheduled to occur by May 1.  AmeriHealth has been selected for a new Medicaid contract with the District beginning May 1; assuming the transition to AmeriHealth occurs as scheduled, the company is expected to manage care for enrollees now served by Chartered. AmeriHealth will begin paying providers for services received on and after May 1.

Chartered estimates more than $50 million in medical-provider claims, most of that owed to District hospitals, will remain unpaid until the illiquid assets issues are resolved and it can determine how much money will be available to pay on the claims.  The rehabilitator plans to communicate with medical providers to discuss the payment situation and care of Medicaid enrollees through April 30.

Please find the status report and other documents in the proceedings at disb.dc.gov/chartered.