Premier Health is shutting down its insurance business, which has been a costly three-year experiment.
Premier joined health networks around the country that tried in recent years to not only operate hospitals but also sell insurance plans. But most health networks lost money on these insurance ventures, especially after parts of the Affordable Care Act were not enacted or drastically changed.
The Dayton-based health network, which operates four area hospitals, notified its staff today that it will get out of the business of managing Medicare Advantage plans by April 1 and it will stop managing commercial insurance plans starting January.
While Premier will stop selling its own insurance plans, its hospitals and doctors will otherwise still accept the same insurance policies from other companies and managed Medicaid and Medicare plans.
Members with Premier Health Medicare Advantage coverage are getting advance written notice that they will need to pick a new plan.
Premier stated that its exit from the commercial insurance market at the beginning of 2019 will give business clients time to choose another insurer without needing to hold a special enrollment period for their employees.
Premier said it is the network’s goal to offer all of its Premier Health Plan employees a job somewhere else in the organization.
Premier Health Plan was first announced in August of 2014 and was launched during a difficult time for start-up health insurance businesses.
Hospital systems across the country dove into the health insurance business after 2010 when the Affordable Care Act created a flood of new customers to buy their policies.
But insurance start-ups proved to be risky endeavors that almost all of these systems lost money on.
The Dayton Daily News previously reported that Premier has lost more than $40 million on its insurance arm over the past two years. Premier Health tried to sell its health insurance business but that deal fell apart in December.
The Ohio Department of Insurance provides Medicare beneficiaries with free health insurance information and counseling at 1-800-686-1578.