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June 01, 2015 at 12:32 PM
Three of the 23 Consumer Operated and Oriented Plan (CO-OP) insurers have maxed out their Patient Protection and Affordable Care Act (PPACA) solvency loan accounts.
But 20 of the CO-OPs still have untapped solvency credit reserves.
Officials at the U.S. Government Accountability Office (GAO), a congressional watchdog agency, have included that finding in a summary of a CO-OP program review prepared at the request of four Republican senators.
Vijay A. D’Souza, a GAO director, writes in the report that the Centers for Medicare & Medicaid Services (CMS), the arm of the U.S. Department of Health and Human Services (HHS) responsible for setting up and running the CO-OP program, has issued about $1.6 billion of the $2.4 billion in available CO-OP funding, including $351 million of 358 million in startup funding and about $1.2 billion of the $2.1 billion in solvency funding.
See also: Court issues CoOportunity liquidation order
PPACA drafters added the CO-OP provision in an effort to create nonprofit, member-owned health insurers that would increase the level of competition in the commercial health insurance market. The drafters authorized HHS to provide startup loans and loans the insurers could use to beef up capital and surplus levels during their early years.
CMS has allocated the CO-OP funding on a plan-by-plan basis.
The CO-OPs in Kentucky and Maine still have more than 10 percent of their startup loan money left over.
Thirteen of the CO-OPs have used up less than 60 percent of the available solvency money.
Five CO-OPs — in Wisconsin Arizona, Oregon, New Mexico, Nevada and Louisiana — have used 60 percent to 90 percent of the solvency money.
