Rep Questions CMS About Lack of Experience in Obamacare Co-op Program

Cortney O'Brien
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Posted: Nov 04, 2015 6:30 PM
Rep Questions CMS About Lack of Experience in Obamacare Co-op Program

A representative from the Centers for Medicare & Medicaid Services faced the Ways and Means Committee Tuesday to answer questions about the systemic failure of Obamacare’s cooperative programs. The co-ops are biting the dust all over the country - after Americans forked over $2.4 billion of course.

Black asked the CMS representative a few specific questions about the co-op program to get to the bottom of its failure. Can a health insurer applying for a loan be a for-profit entity? Can a health insurer applying for a loan use the funding for marketing? Can a health insurer applying for a loan be one that actually acted as a health insurer prior to the law’s passage?

All of the answers were no.

Black summed up the situation:

“The American taxpayer has invested $2.4 billion into a group of folks who never operated an insurance company before, never made any money at it," she explained. "They had no previous claims experience, which was a problem.”

“It seems like it’s awfully difficult given those circumstances that there are some really fundamental problems with the program to begin with,” she added.

Black compared the unfortunate scenario to a private practice. Let’s say she hired a business manager who has never operated a physician’s office and has never made any money at it, she surmised. Would she be confident in that practice's success?

Without answering, the CMS rep tried to justify the situation, arguing that the co-op program was designed to have a governance board that was "consumer-driven." It is not “unique” to the health care field, she insisted.

Tell that to the taxpayers.