Common Ground insurance co-op secures financing

Common Ground Healthcare Cooperative said Friday it has received a capital infusion that will enable it to remain in business and continue to sell health plans next year.

The cooperative said that under terms of its agreement, it could not disclose the source or amount of the financing it received.

“We like to be transparent, but we are bound by this nondisclosure agreement,” said Melissa Duffy, chief strategy office for Common Ground Healthcare.

The financing enabled the cooperative to meet the state’s requirement for reserves and has been approved by state regulators.

The capital infusion — which is secured by the cooperative’s receivables — was first reported by the Milwaukee Business Journal.

Common Ground Healthcare insures 18,000 people in 19 counties.

It is one of the few surviving cooperatives started with federal loans available through the Affordable Care Act. And it has survived in a market that is more competitive than many throughout the country.

But the cooperative, like most if not all insurers who sell health plans on the marketplaces set up by the law, has yet to break even and faced a fateful year.

It lost $84.8 million from its inception in 2012 through the end of last year and owes the federal government $107.7 million.

It lost an additional $16.9 million the first half of this year.

The losses have continued despite its no longer offering a health plan for the individual market that had a so-called broad network of hospitals and doctors. Its health plans now are tied to Aurora Health Care’s network of hospitals and doctors.

“We continue to see higher than expected medical costs,” Duffy said.

The cooperative also incurred other unexpected costs, but Duffy said it was confident about the future.

“We’ve made some adjustments that we believe are going to get us where we need to be,” she said.