Connecticut's taxpayer-funded Obamacare health insurer will close due to minimal federal funding, becoming the 14th consumer-operated and oriented plan to shut down.
The state's insurance regulator took over HealthyCT, the state's Obamacare co-op, on Tuesday due to financial problems. The co-op, created to spur more competition on Obamacare's marketplaces, is the 14th out of 23 nationwide to shut down since they were created in 2014.
Now only nine co-ops remain.
The state's insurance regulator already flagged HealthyCT for needing more scrutiny, but it had enough money to "remain solvent for the foreseeable future," according to the notice from the regulator.
But that changed when the federal government released a report last week on risk adjustment payments.
The risk adjustment program was created to help Obamacare insurers adjust to the new market. It transfers funds from insurers with healthy enrollees to insurers with very sick ones.
The risk adjustment payment report was released June 30 and showed that HealthyCT owed $13.4 million in risk adjustment payments. The regulator said that the payment means that HealthyCT's financial outlook changed.
Republicans pounced on the closure, saying that the 14 closed co-ops have cost taxpayers nearly $1.5 billion in funding.
"With Connecticut's collapse, the administration's failures are closing in on a $1.5 billion hole for taxpayers," said Rep. Fred Upton, R-Mich. "With a meager nine co-ops struggling to survive, we continue to ask the administration when this mess will end and at what cost?"
The administration has said that it is working with state insurance regulators to ensure that the co-ops remain financially sound. It has made several moves in recent months to help shore them up.