California Orders Closure of Meritage Health Plan Over Solvency Issues

The California Department of Managed Health Care has issued a cease-and-desist order to Meritage Health Plan, requiring major Medicare Advantage (MA) insurers to terminate contracts with Meritage and reassign nearly 11,000 MA enrollees by October 31, 2025. This decision follows earlier restrictions due to Meritage's failure to meet state financial solvency standards, including net equity shortfalls approaching $6 million and liabilities exceeding $18 million, posing risks to member care. Meritage operates as part of an independent practice association managing risk and care for members primarily in Northern California's health market. Plans contracted with Meritage were required to file detailed action plans to ensure a smooth transition and continuity of care during the phase-out.