Republican lawmakers are questioning the long-term viability of eight health insurance co-ops formed under the Affordable Care Act, according to a report from The Wall Street Journal.
All of the entities have been placed on some type of enhanced federal oversight or correction plan, a move that is indicative of problems.
Therefore, some lawmakers have expressed concern as to whether the co-ops help keep the price of health insurance premiums in check by competing with large insurers, according to the report. The Wall Street Journal notes these lawmakers also expressed concern about accounting methods used by co-ops, and criticized federal officials for awarding federal loans — about $1.2 billion — to co-ops that failed.
Twelve of the original 23 nonprofit health insurance co-ops formed under the ACA have shut down since the beginning of 2014. Just last fall, nine of the 12 co-ops closed.
The names of the eight co-ops subject to enhanced federal oversight were not disclosed by CMS to The Wall Street Journal. Mandy Cohen, MD, COO and chief of staff at CMS, said federal officials are encouraging the co-ops to look for outside capital and maybe even sell in the large group market, according to The Wall Street Journal.