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The demise of Health Republic Insurance of New York has left medical providers standing in line for whatever scraps of assets that can be found. But the health care insurer's collapse has also paved the way for other companies to get a bigger share of the market.
Upstart insurer CareConnect is trying to do just that in Westchester County. It offers low rates, just as Health Republic did, but uses a business model that it thinks will circumvent constraints that all but guaranteed Health Republic's failure.
"We have the polar opposite model," said Alan Murray, CareConnect's president and CEO. Health Republic's way "could not work mathematically. It was an impossibility."
Medical providers claim that Health Republic owes them around $200 million. Insurance brokers are claiming as much as $30 million in unpaid commissions.
Health Republic's actual assets and liabilities will not be known for some time, according to state regulators.
"The reality is, I don't think any money is left," said James Schützer, vice president of J.D. Moschitto & Associates employee benefits group in White Plains. "All you can do is get in line for whatever piece of the pie is left."
Health Republic began operating in 2014 under the Affordable Care Act. It used a two-pronged strategy to quickly enroll members. Premiums were set 25 to 40 percent lower than other plans. It included a wide network of top hospitals, for which it paid more than its...