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Life Health > Health Insurance

Why not sell

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I hope, as a taxpayer who contributed a few of the billions and billions of dollars the government spent on Affordable Care Act programs, that one thing the ACA repealers and replacers do is think about ways to try to get cash value out of any remaining, potentially marketable ACA-related assets. 

Related: attracts 246,433 new customers

Unfortunately, the way the government has been handling the Consumer Operated and Oriented Program carriers seems a perfect example of how to burn cash in a bonfire.

Senators from states like Montana and North Dakota, where one Blue Cross and Blue Shield carrier dominated the health insurance market, wedged startup loans for nonprofit, member-owned CO-OP carriers in the ACA legislation, in the hope of increasing the level of competition and saving those states from what seemed to amount to de facto (almost) single-payer health care systems.

When the CO-OP programs Senate godfathers left the Senate, any interest in getting any value whatsoever out of the CO-OP startup loan funding seemed to flee from Washington.

Republicans, of course, did what they could to starve the program to death.

But the U.S. Department of Health and Human Services did what it could to kill the program, too, by writing rules that forbade the CO-OP starters from ever selling the CO-OPs to any other entities. The effect of the HHS rules was to keep CO-OP owner members from ever raising any kind of bank loans, venture capital money or other ordinary forms of capital.

The CO-OPs spent tens of millions of dollars to create high-profile brands.

Then, once the CO-OPs started running into trouble, Washington simply let them go splat, without making any effort to change the rules in such a way that the government could preserve some CO-OP operational value and sell the CO-OPs. If people in Washington had actually cared about the taxpayers, maybe Democrats and Republicans could have worked together in such a way that the CO-OP regulators could have sold the dead CO-OPs for, say, $500 per enrollee. Maybe they could have gotten $500 million or even $1 billion in cold hard cash by holding their noses and putting lipstick on the pigs. 

Instead, they did what they could to paint liver spots on the pigs. So, no CO-OP sale cash for us poor taxpayers.

Now, it looks as if the folks in Washington might do the same thing with Just shut it down, splat.

But, whatever the faults of might be, and however much many agents and brokers hate it and want it dead dead dead!, it’s still, really, just a big, government-run web broker. 

Publicly traded web brokers with much less name recognition seem to be worth about $400 per enrollee. That means should probably be worth about $3.6 billion (or about $12 per U.S. resident).

One step ACA repealers and replacers could take would be to take that $3.6 billion web broker and try to sell it to a consortium of agents, brokers and web brokers. That way, the country could get some cash value out of the investment, and producers would get a chance to turn into something useful. 

But, of course, it’s a lot more fun to feed my $12 into a bonfire and watch it burn. So, that’s probably the most likely outcome. 


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