WASHINGTON, DC - Concerned about the solvency of Obamacare’s remaining CO-OPs, Energy and Commerce Committee leaders earlier this week requested information from the 11 surviving CO-OPs. The letters were sent by full committee Chairman Fred Upton (R-MI), Health Subcommittee Chairman Joseph Pitts (R-PA), and Oversight and Investigations Subcommittee Chairman Tim Murphy (R-PA). To date, 12 of the original 23 CO-OPs have closed, bringing the total cost to taxpayers at more than $1.23 billion.
“On November 5, 2015, the Subcommittee on Oversight and Investigations held a hearing to examine the reasons so many CO-OPs have failed," write Upton, Pitts and Murphy. “At this hearing, regulators and representatives of CO-OPs testified about the challenges they have faced to keep CO-OPs in business. These challenges included unpredictable enrollment numbers, management and leadership challenges, and inflexible standards imposed by CMS. The Committee is concerned that the remaining 11 CO-OPs are facing similar circumstances and may not survive when federal loan money runs out."
The leaders continue, “CMS has placed at least eight of the remaining 11 CO-OPs on ‘Enhanced Oversight’ or ‘Corrective Action’ Plans. These additional oversight plans were intended to assist CO-OPs that are struggling financially and/or may not be able to repay their federal loans. After reviewing these oversight plans, the Committee is concerned that CMS has not taken the appropriate steps to ensure that the remaining CO-OPs will be financially solvent for the remainder of the year. Federal taxpayers have invested over $1 billion into the remaining 11 CO-OPs. Especially considering this substantial taxpayer investment, the Committee wants to ensure CMS is taking the necessary and appropriate steps to keep these CO-OPs afloat."
The leaders requested a response to their questions within two weeks from today. Upton, Pitts, and Murphy previously asked CMS for an update on the solvency of the CO-OPs in November 2015.
