The year-end decision of New Mexico Health Connections would leave only three of the 23 nonprofit health insurance cooperatives that derive from the Affordable Care Act.
One cooperative serves clients in Maine, another in Wisconsin, and the third operates in Idaho and Montana and will be moving to Wyoming next year. They all made money in 2019 after having survived several difficult years, according to data presented to the National Association of Insurance Commissioners.
He was also asked to receive tens of millions of dollars from the federal government under an April decision of the Supreme Court that said to help the government in the loss of the throne in the first three years of the billions it received from the ACA in 2014. Was from 2016 to. Intended Insurers.
While those payments were intended to help insurers lose money, they were important to cooperatives because they had the least amount of financial support.
Nonprofits were a last-minute addition to the 2010 healthcare bill to satisfy Democratic lawmakers who had failed to secure a public-option healthcare plan, one established and run by the government, in the markets. Congress made $ 2 billion in initial loans. But almost all cooperatives struggled to compete with incumbents, who already had more money and well-known brands.
State insurance officials and health experts are hopeful that the last three cooperatives will survive.
Maine aided in Supreme Court victory
Maine’s cooperative, Community Health Options, helped attract competition to the state market, which has at times had trouble attracting insurance companies, said Eric Cioppa, who heads the state’s insurance bureau.
Community Health Options is one of only three insurers in the Maine Obamacare market, the minimum number that experts say is necessary to ensure vibrant competition.
Kevin Lewis, the plan’s chief executive, attributed its survival to several factors, including an initial profit in 2014, the year ACA markets opened, putting the plan on a safe footing ahead of several years of losses. He also acknowledged running most health plan functions in-house rather than outsourcing, diversifying to sell plans to employers small and large, and securing lower rates from two health systems over a difficult couple of years.
Insurers are in talks with the Trump administration about whether the $ 13 billion owed to carriers should be added to their 2020 balance sheet or could be counted for operations from previous years. Given that the ACA limits insurers’ profit margins, he added that the federal windfall on the ledger this year could mean that many insurers would have to pay their consumers most of the money. If the money is applied to previous years, insurers could probably keep more to add to their reserves.
Too much competition in New Mexico
The cooperative reportedly received $ 43 million in late payments, but in an effort to raise the necessary cash, sold that debt. . to another insurer in 2017 for a much lower amount.
Marlene Baca, CEO of the cooperative, which made a profit of $ 439,000 in 2019, said her goal of bringing competition to market has been achieved, as five other companies will enroll clients this fall by 2021. However, that competition will finally be finished. it will be achieved. . led to the decision of the plan to end operations, announced last month.
His plan was also hit by this year’s economic recession, which put many state residents out of work and made more than 3,000 members eligible for Medicaid, the state-federal health program for the poor.
Wisconsin’s mystery donor
Common Ground Healthcare Cooperative of Wisconsin was nearing completion in 2016 when it received a $ 30 million loan that saved his life, said CEO Cathy Mahaffey.
Common Ground, which posted a profit of $ 73 million last year, expects to receive about $ 95 million from the victory of the Supreme Court case.
Cooperative legislation has benefited from Wisconsin’s decision not to extend Medicaid under health law because people with incomes ranging from 100% to 138% of the federal poverty level ($ 12,760 to $ 17,609 for an individual) are not eligible for Medidid. Are and they should remain in it. Market plan for coverage. In states that expand Medicaid, all people with incomes below 138% of the poverty level are eligible.
