Colorado Access, a provider-run Medicare and Medicaid HMO in Denver, has 45 days to submit a financial recovery plan to the state Division of Insurance or risk being put under formal supervision, Colorado regulators said. The warning was issued after the not-for-profit health plan posted a $7.6 million loss for the first half of 2005 because of unexpectedly high medical costs. As a result, its risk-based capital reserves fell to $7.5 million, about $4.5 million short of statutory requirements for solvency. Colorado Access was founded in 1994 by 368-bed University of Colorado Hospital and 236-bed Children's Hospital, both in Denver. For the six months ended June 30, the HMO's revenue fell 25% to $75.8 million and enrollment fell 14% to 164,000 members. Less than a month ago, two leading Medicaid HMOs, Amerigroup Corp. and Molina Healthcare, posted significant declines in earnings that they attributed to rising medical costs. -- by Laura B. Benko
High costs trouble provider-run Medicaid HMO in Colo.
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