WASHINGTON, DC - House Energy and Commerce Committee leaders are seeking answers from the Centers for Medicare and Medicaid Services (CMS) on the agency’s plans for continued oversight of Obamacare’s CO-OPs. To date, 12 of the original 23 CO-OPs have closed, bringing the total cost to taxpayers at more than $1.23 billion. The letter sent Tuesday follows up on a November 5th Oversight and Investigations Subcommittee hearing during which CMS Chief of Staff Mandy Cohen was unable to identify specific actions the agency would be taking to address problems the remaining 11 CO-OPs, which collectively received over $1 billion in federal loans, are facing.
In the letter to CMS Acting Administrator Andrew Slavitt, full committee Chairman Fred Upton (R-MI), Oversight and Investigations Subcommittee Chairman Tim Murphy (R-PA), and Health Subcommittee Chairman Joseph Pitts (R-PA) write, “The Committee is concerned that CMS does not have a plan to ensure that the remaining CO-OPs are financially solvent. The existing 11 CO-OPs represent over $1 billion dollars in federal loans that should be paid back to the federal treasury over the next decade. Additionally, the Committee believes that CMS should take actions to recoup federal dollars from failed CO-OPs wherever possible, in order to mitigate the loss to taxpayers."
The leaders also raised concerns with CMS’ handling of taxpayer dollars. They continued, “[M]embers questioned CMS’s decision to award an additional $91 million to Health Republic of New York in late 2014, when Health Republic had documented and significant financial difficulties. In fact, CMS awarded $350 million to six CO-OPs in late 2014; three of the CO-OPs that were awarded additional funds closed before open enrollment this year. Given CMS’s decision to spend more taxpayer money on failing CO-OPs, the Committee is concerned that CMS is unable to manage the CO-OP program effectively."
The committee leaders are seeking documents and information on the CO-OP program, including what steps CMS is taking to recover taxpayer dollars from the 12 failed CO-OPs and what the agency is doing ensure the remaining 11 are financially stable.
Read a copy of the letter to CMS Acting Administrator Andrew Slavitt here.
