The Maryland Insurance Administration says it will protect Evergreen Health individual coverage holders against a gap in coverage by automatically shifting holders who fail to choose a new plan into replacement coverage.

The Evergreen Health individual market withdrawal will affect about 6,000 holders of the company's individual and family coverage, officials say in a set of answers for consumers. About 4,000 could be auto-renewed into coverage from a local affiliate of Oakland, California-based Kaiser Permanente, and about 2,000 could end up with coverage from a unit of Owings Mills, Maryland-based CareFirst Inc.

Evergreen Health group health coverage will stay in effect until the policy renewal date, officials say in a separate announcement.

The organizers of Evergreen Health started the carrier with loans from the Affordable Care Act CO-OP program. The ACA drafters created the program in an effort to use federal loans to encourage community groups to start member-owned, nonprofit health plans, to increase the level of competition in the individual and small-group health insurance markets.

Related: Why do people buy individual plans outside of the ACA marketplace?

CO-OP organizers have had to cope with big cuts in federal CO-OP funding, sudden changes in ACA programs that were supposed to buffer health insurers against problems with new ACA rules and programs, and CO-OP rules that keep CO-OPs from using any business value they build up as loan collateral. Only a handful of the 23 CO-OPs that came to life in January 2014 are still in business.

Managers of Evergreen Health told Maryland news organizations in October that they were hoping to overcome the problems with the CO-OP system by getting permission from the federal Centers for Medicare & Medicaid Services to convert the company to a for-profit charter.

Dr. Peter Beilenson, the company's chief executive officer, said last week in a statement that the proposed conversion is moving forward.

"We have a very strong group of investors and are working closely with federal and state regulators to craft a deal that will close sometime in the first half of 2017," Beilenson said in the statement. "Right now, we continue to sell to small and large groups. When the conversion is done, Evergreen will be in a much stronger financial position than we have ever been in and, as a result, even better able than before to produce the high-quality, affordable services that our members have come to expect from us."

Maryland officials and Evergreen Health have not publicly talked about how the shift of consumers who fail to actively choose new coverage into new plans will affect any agents or brokers who have helped consumers sign up for Evergreen Health coverage. Officials are encouraging consumers to seek help with getting replacement coverage from insurance brokers or consumer assistance organizations.