Financially troubled Iowa health insurance cooperative CoOportunity Health has collapsed, according to an NPR-Kaiser Health News report.
Although CoOportunity Health was one of the country's largest co-ops as far as membership and the federal funding it received, it ran into financial troubles, in part because it had to foot more medical bills than anticipated, according to the report.
"CoOportunity Health's pool of people was larger than expected, was sicker than expected," Peter Damiano, director of the University of Iowa's public policy center, said in the report. "So their risk became much greater than the funds that were available."
In 2014, Des Moines, Iowa-based Wellmark Blue Cross and Blue Shield announced it will not participate in the federal marketplace in 2015. That means that CoOportunity and Coventry were the only payers offering plans on the exchange throughout Iowa after Wellmark dropped out, according to the report.
Nick Gerhart, Iowa's insurance commissioner, said in the report that CoOportunity also believed more federal dollars were coming its way, which was not the case.
Martin Hickey, MD, chairman of the board of the National Alliance of State Health Co-Ops, made a statement on the failure of CoOportunity, calling it "a reflection on the fact that all insurers — not just co-ops — are operating in unique markets with unique business plans and varying state regulations."
The state of Iowa has taken over the co-op.
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