New Mexico Health Connections’ decision to close at year’s end will leave just three of the 23 nonprofit health insurance co-ops that sprang from the Affordable Care Act.
One co-op serves customers in Maine, another in Wisconsin, and the third operates in Idaho and Montana and will move into Wyoming next year. All made money in 2019 after having survived several rocky years, according to data filed with the National Association of Insurance Commissioners.
They are also all in line to receive tens of millions of dollars from the federal government under an April Supreme Court ruling that said the government inappropriately withheld billions from insurers meant to help cushion losses from 2014 through 2016, the first three years of the ACA marketplaces. While those payments were intended to help any insurers losing money, it was vitally important to the co-ops because they had the least financial backing.
Lauded as a way to boost competition among insurers and hold down prices on the Obamacare exchanges, the co-ops had more than 1 million people enrolled in 26 states at their peak in 2015. Today, they cover about 128,000 people, just 1% of the 11 million Obamacare enrollees who get coverage through the exchanges.
The nonprofit organizations were a last-minute addition to the 2010 health law to satisfy Democratic lawmakers who had failed to secure a public option health plan — one set up and run by the government — on the marketplaces. Congress provided $2 billion in startup loans. But nearly all the co-ops struggled to compete with established carriers, which already had more money and recognized brands.
Read full article here: https://khn.org/news/obamacare-co-ops-down-from-23-to-final-3-little-miracles/