Land of Lincoln joins co-ops shutting down due to risk corridor payments

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Another Affordable Care Act co-op has gone under due to the federal risk adjustment mandate and four more are expected to disappear by the fall, leaving the number of working co-ops at the start of the new enrollment season at seven.

This week, the Illinois Department of Insurance said the Land of Lincoln Mutual Health Insurance Company would close because the Centers for Medicare and Medicaid Services has withheld more than $70 million in risk corridor payments and also decided not to suspend the co-op's liability, according to Acting Director Anne Melissa Dowling.

[Also: Oregon's ACA co-op goes into receivership due to risk adjustment mandate]

Last month, Dowling tried to save the insurer by blocking it from paying a $31.8 million bill to the federal government, according to ABC News. This was while it was owed nearly $73 million in risk corridor payments, according to Dowling.

Land of Lincoln will continue paying policyholder claims, while the director prepares the company for liquidation and works with CMS to establish a 60-day special enrollment period for the insurer's  49,000 policyholders to obtain new healthcare policies on the exchange.

[Also: Coordinated Health Mutual in Ohio becomes 13th co-op to fail]

After two years of operation, Land of Lincoln lost $90 million in 2015 and more than $17 million this year, ABC News said.

The financial losses have been a troubling trend for many of the original 23 nonprofit consumer operated and oriented plans set-up under the Affordable Care Act to offer competitively-priced health insurance coverage.

Oregon's Health Co-Op and Connecticut's HealthyCT were told to close by their state's regulators last week.

Twitter: @SusanJMorse