Iowa’s insurance commissioner filed a lawsuit against the federal government on Tuesday, saying it is withholding $20 million in connection with the liquidation of not-for-profit insurer CoOportunity Health — which failed in December 2014.
“Through the wind down of CoOportunity, we’ve worked collaboratively with the Centers for Medicare and Medicaid Services and the federal government on many issues,” said Insurance Commissioner Nick Gerhart in a news release. “In this instance, we tried diligently to settle our differences with the federal government in extensive discussions over several months, but were informed by the Department of Justice that further negotiations would be futile.”
Gerhart said U.S. Department of Health and Human Services and CMS have “tried to jump to the head of the creditor line,” and are not following Iowa or federal law.
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