Bright Health Group could add Tennessee to a growing list of states concerned about their ability to meet their financial obligations.
According to Tennessee Department of Commerce and Insurance records, Tennessee regulators oversaw the struggling health insurance company in November. Bright Health was banned from spending more than $10,000 at a time without approval from Tennessee. The State also reserves the right to initiate legal, liquidation or illegal proceedings against the company.
Bright Health revealed this month that it needs to raise $300 million or risks closing by the end of the year. The company reported a shortfall of $12.9 million among its state-managed subsidiaries as of December 31.
Insurance company money troubles have drawn negative attention in several states. Florida regulators have placed the company under scrutiny since last year, subject to similar spending restrictions as in Tennessee. The insurer also has operations in Alabama, Arizona, California, Colorado, Georgia, Illinois, New York, North Carolina, Ohio, South Carolina and Texas.
Under Tennessee’s orders, Bright Health may not transfer funds from its Tennessee subsidiary to its parent company without a license. The state must also authorize the company to transfer assets, change management or remove insurance products. Bright Health must reimburse Tennessee for any costs incurred in carrying out the supervision order. Bright Health’s Tennessee operation held $186 million as of December 31, according to financial filings.
A spokeswoman wrote in an email that the Tennessee Department of Commerce and Insurance declined to say when it sealed the surveillance order, but believed it was in the public interest to do so.
Bright Health Group did not immediately respond to a request for an interview.
