Bright Health Group can add Tennessee to the growing list of states concerned about its ability to meet its financial obligations.
Tennessee regulators placed the struggling health insurance company under supervision in November, according to Tennessee Department of Commerce and Insurance filings. Bright Health has been prohibited from spending more than $10,000 at a time without approval from Tennessee. The state also reserved the right to initiate legal, liquidation or delinquency proceedings against the company.
Bright Health disclosed this month that it needs to raise $300 million or risk shutting down by the end of the year. The company reported a $12.9 million shortfall among its state-regulated subsidiaries as of Dec. 31.
The insurtech’s money woes have attracted negative attention in a number of states. Florida regulators have had the company under supervision since last year, subject to similar limitations on spending as in Tennessee. The insurer also has operations in Alabama, Arizona, California, Colorado, Georgia, Illinois, New York, North Carolina, Ohio, South Carolina and Texas.
Under the Tennessee order, Bright Health may not transfer money from its Tennessee subsidiary to the parent company without clearance. The state also must grant permission for the company to transfer property, change management or eliminate insurance products. Bright Health must reimburse Tennessee for any expenses incurred to execute the supervision order.
Bright Health’s Tennessee operation held $186 million as of Dec. 31, according to financial filings.
The Tennessee Department of Commerce and Insurance declined to disclose exactly when it unsealed the supervision order, but the step was in the public interest, a spokesperson wrote in an email.
Bright Health Group did not immediately respond to an interview request.
Source : Modern Healthcare