More than 60,000 Oregonians enrolled in Moda Health’s individual insurance policies for 2016 — including more than 8,000 in Deschutes County — will need to choose new insurance carriers, as the company announced Thursday it is pulling out of the individual markets in Oregon and Alaska.

Moda’s announcement came after Oregon’s Department of Consumer and Business Services issued an order of immediate supervision to the embattled health insurance carrier due to concerns over its dire financial state. The order prohibits the company from selling new policies or renewing current ones until it can produce a viable business plan.

In order to keep offering small and large group policies, the state’s order says Moda must present a business plan demonstrating it can operate in sound financial condition no later than Friday . Moda spokesman Jonathan Nicholas said Moda intends to submit a business plan so it can continue to operate in the group market, which currently has about 145,000 members.

For Oregonians who already purchased individual Moda policies for 2016, this could mean a few things, DCBS Director Patrick Allen said. Moda could be acquired by one or more carriers and the state would help transfer members to the new carriers. If that doesn’t happen, the policies will be canceled and DCBS will open a special enrollment period so people can buy new policies.

Allen said he’ll determine a course of action in “days, not weeks” after receiving Moda’s business plan.

In the meantime, Moda policyholders can shop for new policies on HealthCare.gov, where open enrollment lasts until Jan. 31, Allen said.

“If they believe it’s in their best interest to go in and make an alternative selection, we believe that’s probably not a bad idea,” he said.

One thing is for sure, Allen said: Moda members’ medical claims will be paid and there is no need to refrain from getting medical care.

“That’s why we’re doing this is to ensure that claims do get paid,” he said.

Moda CEO Robert Gootee wrote in a statement Thursday that bringing tens of thousands of people into the Affordable Care Act marketplace, many of them with acute medical issues, has been a difficult process to manage.

“The cost of providing this level of care, with all its attendant uncertainties, has put an unprecedented financial strain upon our health plan,” he wrote. “So, at the direction of the Insurance Commissioners in both Oregon and Alaska, we have resolved to exit the Individual ACA marketplace in both states. We now look forward to working to make sure that all individuals in the ACA marketplace will have no interruption in coverage as they transition to new carriers.”

Alaska’s top insurance regulator, Lori Wing-Heier, called Oregon Insurance Commissioner Laura Cali when she realized Moda had suffered a total net loss of nearly $31 million as of Sept. 31, 2015. Oregon law considers an insurance company hazardous to policyholders if its operating loss is greater than half its excess capital and surplus. Moda’s capital and surplus is $50.6 million, according to the state order.

Moda dominated the health insurance market in 2014 — the year insurance became mandatory under the ACA — selling about 115,000 individual policies as of September out of about 213,000 total individual policies. But those members turned out to be much sicker than the company had anticipated, and it has increased the monthly costs of its policies dramatically ever since.

Moda is not the only carrier to experience higher-than-expected claims from enrollees. Health Republic Insurance Co. announced in October 2015 it was withdrawing from Oregon’s marketplace in 2016, citing lower-than-expected payment from a federal program designed to shield carriers from financial risk. Moda also received far less than expected from the so-called risk corridors program, which provides payments to companies whose claim payments exceed their costs.

Moda administers the Eastern Oregon CCO, which serves 48,000 members of the Oregon Health Plan, the state’s version of Medicaid. DCBS said Thursday no one on OHP will lose coverage.

If the state does not approve Moda’s plan to remain in the group market, there could be implications for Oregon’s public employees. About 1,100 members of the Public Employees’ Benefit Board are enrolled in Moda plans, as are 42,000 members of the Oregon Educators Benefit Board. PEBB is a self-insured group, while OEBB is insured under a Moda group policy.

— Reporter: 541-383-0304,

tbannow@bendbulletin.com