An Ohio Republican is demanding the Obama administration help the people who held a plan with an Obamacare insurer that has now collapsed.
Sen. Rob Portman wrote to the administration Thursday demanding to know what it plans to do to help customers of Ohio’s consumer-operated-and-oriented plan, a taxpayer-funded Obamacare insurer that collapsed because of poor management and finances.
Portman said in the letter that 22,000 state residents had plans with Ohio’s co-op InHealth Mutual. The Ohio co-op is one of 13 out of 23 co-ops to collapse since their creation in 2014 to spur more competition on Obamacare markets.
Portman said plan holders “have to find new insurance or risk paying a penalty to the IRS. Worse, many of them have already paid high deductibles for their co-op coverage, yet they are about to lose credit for those payments and incur more out-of-pocket costs if they chose a new insurance plan mid-year.”
Portman wrote to Andy Slavitt, acting head of the Centers for Medicare and Medicaid Services, asking if the administration has taken any steps to ensure residents who paid deductibles get a refund or credit toward a new health plan. He also asked about what out-of-pocket losses InHealth enrollees could “stand to suffer in the form of uncredicted deductible payments?”
Republicans have been hammering the administration about the co-op closures, pointing out that about $1.2 billion in taxpayer funding could be lost. Part of the reason for the closures has been a lack of federal funding from a program intended to mitigate insurer losses and setting prices too low.
Another part of the problem is that co-ops were startups and didn’t have the reserves to deal with losses. Administration officials have said they expected some co-ops to have problems because they were startups.
The Ohio co-op racked up more than a billion dollars in losses last year, Portman said in his letter. He charges the administration didn’t take corrective actions soon enough to forestall the collapse.
CMS responded that it will speak with Portman directly. “We are working with InHealth and the state to provide consumers with the information they need to stay covered,” CMS spokesman Aaron Albright said.
The co-op closure comes as major insurers have started to flee certain Obamacare markets. UnitedHealth announced earlier this year that it will exit a majority of the states in which it offers Obamacare plans, and Humana has announced it will leave some markets.
Other major insurers, most notably Anthem Blue Cross/Blue Shield, have said they remain committed to Obamacare.
