The entire ObamaCare law is a house of cards. These health care insurance co-opts have never succeeded, yet the Obama regime is going to blow $639 million to prove what has already been proved. They will fail!
From KaiserHealthNews.org:
Seven organizations will receive a total of $639 million in federal low-interest loans to launch new, consumer-governed health insurance plans in eight states, the federal government announced Tuesday.
The new plans, authorized by the 2010 health law, are scheduled to open for business in 2014. They will be available on the new state health exchanges, or marketplaces, mandated by the law, and primarily will serve Americans under age 65 in the individual and small-group insurance markets. More loan recipients will be announced in coming months, with the goal of launching at least one nonprofit co-op plan in every state, according to the Centers for Medicare & Medicaid Services, which administers the program.
These are the same exchanges nobody seems to want since nobody is signing up for them. Most states have already complained about these exchanges and HHS itself ended its CLASS Act when it found the exchange couldn’t fund itself as was promised. Nothing these idiots promised have panned out as health care costs and insurance premiums continue to rise…despite the passing of ObamaCare. Who could have predicted that federal involvement into the health care system would end up costing more that predicted?
The seven loan recipients are Freelancers CO-OP of New Jersey, New Mexico Health Connections, Midwest Members Health in Iowa and Nebraska, Common Ground Healthcare Cooperative in Wisconsin, Freelancers CO-OP of Oregon, Montana Health Cooperative, and Freelancers Health Service Corporation in New York.
Wonder how many gave $$$ to Democrats to receive these low-interest loans?
Interest rates will vary between 0 percent and 1 percent, based on the current rate for Treasury securities of similar duration. The loans will be disbursed over time, as plans meet government-set milestones for progress. A CMS official said the agency has an “early warning system” to spot if a co-op plan is facing financial problems and requires intervention.
Remember, this health care takeover isn’t about government control (wink).
The new plans are being formed by public health activists, medical associations, business groups, hospital executives, labor unions and others. They’re betting that Americans want a local, consumer-friendly alternative to commercial insurers.
Wonder how many of these “groups” received those infamous “ObamaCare waivers” to duck the health care law but will now benefit from these loans?
“People from all walks of life are dissatisfied with the status quo, and believe that our health care and health insurance system can be dramatically improved,” said John Morrison, a former Montana insurance commissioner who is on the board of the proposed Montana Health Cooperative and also heads the National Alliance of State Health Cooperatives.
The plans are being started under the health law’s Consumer Operated and Oriented Plan (CO-OP) program. The aim is to increase competition among insurers, potentially reducing premiums and improving health care quality and customer service. In many states, only one or two insurers control the bulk of the health insurance business.
The health reform law originally allocated $6 billion to provide loans to help co-op plans start up and meet state insurance solvency requirements. But Congress last year slashed that funding to $3.4 billion as part of broader budget cuts, raising concerns about how many co-op plans can be funded. Co-op supporters are hoping CMS will commit all the remaining loan money before Congress makes further cuts.
Some experts are skeptical that these fledgling health plans can compete effectively against large, established insurers. They warn of the difficulties of recruiting experienced insurance executives and of quickly signing up a large enough and healthy enough membership to make the plans financially viable. Many nonprofit insurance plans launched under federal initiatives in the past 40 years went bust or were sold or converted to for-profit status.
Of course, the federal government expects to lose over 40% of the monies lent in these loans…
…Richard Popper, the CMS official heading the co-op program, would not disclose how many organizations have applied for loans. The average loan is projected by the government to total $15 million for start-up costs and $100 million for state insurance reserve requirements, with repayment required within five years for the start-up loans and 15 years for the reserve loans. Some of the start-up plans are expected to fail, and the government last year predicted a nearly 40 percent default rate for the loans.
“There will be a large number of casualties in this first crowd, but we need more health plans,” Goldsmith said. “I think this is worth a shot.”
It’s not their money so they could care less about loaning hundreds of millions of dollars to an unproven health care co-op scheme.
