Failed ObamaCare co-ops have not repaid $1.2B in federal loans...

[tRidiot]

Failed ObamaCare co-ops have not repaid $1.2B in federal loans, docs say

EXCLUSIVE: The dozen failed ObamaCare cooperatives have not repaid any of the $1.2 billion in federal loans they received and still owe more than a $1 billion in additional liabilities, according to recent financial statements to be cited Thursday at a congressional hearing.

In prepared remarks for his opening statement at the hearing, Sen. Rob Portman, R-Ohio, chairman of the Senate Permanent Subcommittee on Investigations, says, “In some states, those losses will be absorbed by other insurance companies—which means, by the policyholders of other insurance companies who have to pay increased premiums.


“In other states, doctors, hospitals and individual patients stand to suffer large out-of-pocket losses due to the co-ops’ failures—as our report details … We should not hold our breath on repayment.”

Portman’s statement, obtained by Fox News, refers to an investigation by the committee’s majority staff.

It claims the most recent balance sheets provided to the subcommittee show the failed cooperatives owe more than $700 million to doctors and hospitals for plan year 2015.

The failed cooperatives lost $376 million and exceeded the projected worst-case-scenario losses outlined in their loan applications by more than $260 million in 2014. They lost an additional billion dollars in 2015, according to the report.

“Once the co-ops got going in 2014, things went south in a hurry—both in terms of financial losses and enrollment figures that wildly deviated from the co-ops’ projections,” Portman’s statement says. “Despite getting regular reports that the co-ops were hemorrhaging cash, HHS [the Department of Health and Human Services] took no corrective action for over a year.”

Deloitte Consulting initially granted the cooperatives a passing grade based on an HHS-designed grading scale. However it added seven of the 12 had serious deficiencies in their enrollment strategy, according to the report. Others submitted budgets that were “incomplete, unreasonable, not cost-effective” and several “relied on unreasonable projections about their own growth.”

The report cited in Portman’s statement also claims that from 2014–2015, the administration lent an additional $848 million to the failed cooperatives, as they lost more than $1.4 billion.

In previous testimony, administration officials have told congressional panels that the administration scrutinized cooperative business plans and then placed them on corrective oversight when necessary.


“In 2015 we conducted 27 financial and operational reviews, 16 in-person visits, and had 43 formal communications,” Andy Slavitt, the acting administrator of the Centers for Medicare & Medicaid Services, told the Senate Finance Committee earlier this year. “Not to mention hundreds of phone calls. And we've kept the states up to speed on every important interaction to help inform their regulatory actions.”

When questioned how much money the government could salvage from the failed cooperatives, officials said they were only beginning to determine amounts.

“We are in the process of recouping that loan money right now,” said Dr. Mandy Cohen, the chief operating officer and chief of staff of the Centers for Medicare and Medicaid, last month to a House panel. “We’ll look at their excess revenue and then use all the tools available to us through their loan agreements and state and federal law to pull back federal tax dollars.”

ObamaCare provided $2.4 billion in federal loans to establish 23 non-profit cooperatives. A dozen failed and the administration has required eight of the remaining eleven to adhere to a “corrective action plan” designed to fix business flaws and prevent additional failures. The closed cooperatives account for $1.2 billion in federal loans.

Defenders of the law and cooperatives say these non-profit insurers operated in difficult markets and that it often takes years of financial commitment to build a viable business.

The failed cooperatives left hundreds of thousands of customers searching for a new insurance company. In some states, the loss was significant.

“HHS gave the New York co-op $90 million to prolong its financial life, rather than allow it to scale down, that co-op went on to lose another $544 million in 2015,” according to Portman’s statement, citing his staff’s report.

Former Secretary of State Hillary Clinton, the frontrunner in the Democratic presidential delegate count, pledged she would address the market void left by the failed cooperatives.

“We need to get more companies, more nonprofits, to fill this space. The ones that knew what they were doing have provided good services, but a lot of them have failed because they didn't have the right support,” she said Monday at a Democratic presidential forum hosted by Fox News.

“Even in those markets where those co-ops had previously operated, we have seen a commitment on the part of those who are administering the markets to try to facilitate greater competition,” said White House Press Secretary Josh Earnest. “And creating the co-ops was just one way to do that, but we certainly are going to be open to other ways to encourage other entities, private or public, to get engaged in this process.”

When previously questioned by Congress, administration officials declined to forecast how many of the remaining cooperatives would survive this year.

“The co-ops themselves are really the ones who are going to be the ones to determine whether or not they ultimately will be successful,” said Cohen. “They have a lot of work to do to rapidly mature their entities, their small businesses as you know and they’re still getting their foothold on this business.”

This is my favorite part:

It claims the most recent balance sheets provided to the subcommittee show the failed cooperatives owe more than $700 million to doctors and hospitals for plan year 2015.

And people wondered why providers didn't want to take Obamacare? Ugh. What a mess.

 

[Shootin 4 Fun]

In all fairness, if those providers were billing insurance companies that $1.2b would probably be closer to $200m.

I'm not a fan of Obamacare, but after going through a year of testing and then surgery, all the while reviewing how the insurance companies and providers settle $1300 invoices for $49, I'm not a fan of the bogus billing practices of the medical service providers either.

Example. The bill for my surgery comes in and states that my insurance company saved me $54,000 reducing the bill from $70,000 to $16,000. That's some serious bullhockey right there. I know that my Cadillac plan is good, but I don't think that it's that good.

 

[twoguns?]

This...a service my insurance co pays $34 dollars for , costs me $191 if I pay cash....?????

 

[swampratt]

Ok so the Gov. gave these CO-OP's seed money to get started.. and these CO-OP's are to find health care providers(doctors and hospitals) for their clients. The clients (us sick people) are to pay premiums that sustain the CO-OP's and sustain them enough to pay back the loans that the Gov. gave them to get started.

DEFINITION: Non-profit cooperatives – or insurance cooperatives – were proposed in the Senate as an alternative to a proposed government plan or public option. The cooperatives, which would have been structured as non-profits and owned by their members, would offer a network of health care providers or contract out for medical services.

Read this here.

The concept championed by some Democrats would provide “seed money” for the cooperatives, which would then be sustained by customer premiums. The final version of the ACA included Consumer Oriented and Operated Plans (CO-OPs), which will be available in 24 states in 2014. Read this Commonwealth Fund history of health cooperatives.

https://www.healthinsurance.org/glossary/non-profit-cooperatives/


Math 10 million on obama care.
1 billion dollars.
If 10 million people paid 100 bucks you would have 1 billion dollars.

If everyone ran up more than the premiums the system would collapse.

Not hard to run up more than the premiums. I really do not see much head way.

 

[NightShade]

The funny thing is that for my recent shoulder surgery it's nearly the same, however the hospital shows that my plan paid $11,325.44 but due to a coding error I got the ACTUAL full information where the insurance actually paid $1,934.35 their discount was $9,429.78 and my share is 644.78. This is ONLY for the hospital and does not include anesthesiologist charges which were 1330.03 of which 1105.85 were denied and the plan paid 224.18 and shows I owe zero.

Another denial shows an office visit is billed at 667.00 of which 39.00 was denied due to a coding error and the discount was 518.69. To me it seems like a plan racket going on when an insurance company can get huge discounts. I wouldn't be surprised if both sides were showing discounts as losses, the insurance company showing it as paid out on the bottom line and the providers showing it as a loss of not recived.

The other major racket is the "donut hole" where when you get to a certain amount of coverage you have to pay 100% for a few thousand dollars. My wife's health is pretty bad, the Neurosarcoidosis has to be kept in check with a dose of steroids which over the long term causes diabetes, the pill forms of medications no longer work and even when they did work were doing a poor job of things. Now she has to take insulin, she uses around 3000 units of a long acting a month. Our copay is around 45.00 per month for it but the insurance pays in the 600 to 700 range for it. After a few months we will hit the donut hole and pay for everything. The doctors want to add ANOTHER insulin and 45.00 per month copay and she will end up taking around 900 units per month to start and the insurance will pay another 300 or so for it so we now hit the donut hole in around 2 to 3 months at which point she may as well go dig her own grave if we do it their way.

The system is severely broken plain and simple. The "affordable" healthcare act (aka Obummercare) only reinforced the insurance companies bottom line forcing everyone to be insured and nearly guaranteeing that when people get to a certain level of care coverage they will never get past that point. Pay your premiums for 30 years with little more than a cold and when you really get sick live without coverage for most of the year unless you can pay a few thousand out of pocket or get yet another insurance plan.

 

[Shootin 4 Fun]

It's hard to tell who is more crooked, the medical service providers or the insurance companies. Hell, I could afford to live with catastrophic coverage of the service providers offered me the same discounts the offer insurance companies and Medicare.

 

[71buickfreak]

Which is why people familiar with the industry wanted real reform. Instead we were all forced to buy into the broken system.

 

[doctorjj]

It's hard to tell who is more crooked, the medical service providers or the insurance companies. Hell, I could afford to live with catastrophic coverage of the service providers offered me the same discounts the offer insurance companies and Medicare.

Providers are essentially forced to play this stupid game. If they just said, okay, we charge $10,000 but you only pay $1,000, so how about let's just charge $1,000, then the insurance companies would say great, so since you charge only $1,000 we are gonna pay you $100. It's a ridiculous game. Believe me, I would much rather charge way less and just deal with cash or payment up front. I pay one girl, full time, to essential jack around with insurance companies. Trying to get approvals.

 

[4play]

If half of the co-op's are that far off in debt, how are the other half of them doing? I doubt they are doing great.

 

[doctorjj]

Which is why people familiar with the industry wanted real reform. Instead we were all forced to buy into the broken system.

Yup!!!