A year after Friday Health Plans began offering policies on the health insurance exchange for Oklahoma, the company finds itself under state supervision.
Tuesday's move by the Oklahoma Insurance Department came just weeks after its Texas counterpart took a similar action as Friday Health Plans struggles to maintain sufficient reserves to cover outstanding claims in at least these two states.
Friday Health Plans must obtain approval from Oklahoma regulators before spending more than $5,000 under the terms of an order the Sooner State issued Tuesday. The state will monitor the health insurance company's expenses and terminate accounts deemed unnecessary.
Furthermore, the company is enjoined from mergers or changes to its management structure or executive compensation. The insurance agency reserves the authority to take additional steps, such as requiring Friday Health Plans to establish a joint banking account with Oklahoma from which claims would be paid. The company also may not enroll new customers.
“The decision to place Friday Health under supervision was not taken lightly,” Oklahoma Insurance Commissioner Glen Mulready (R) said in a news release Wednesday. “However, given the company’s financial situation, we determined this was the best action to protect policyholders and ensure their claims are paid.”
The Oklahoma Insurance Department and Friday Health did not immediately respond to interview requests.
Oklahoma has been monitoring Friday Health Plans and maintained regular contact with its leadership team since the abrupt departure of CEO Sal Gentile in December, Mulready said. The company's board of directors subsequently appointed former Humana and Highmark Health Plan executive Beth Bierbower as CEO.
Friday Health is a privately held, venture-backed company founded in 2015 that sells policies to individuals and small employers on the health insurance exchanges. The company reported having more than 300,000 members at the end of 2022.