The House Ways and Means Committee is launching a probe into ObamaCare’s startup insurers, known as co-ops, which Republicans warn could collapse before repaying government dollars.
“We have long been concerned about the financial solvency of CO-OPs,” three subcommittee chairmen wrote in a letter to the Department of Health and Human Services on Wednesday.
The committee is demanding more details about the oversight of the co-op program less than a week after a fourth co-op was shuttered in New York because of financial struggles.
That co-op was one of 23 that received seed money from the federal government to help create alternatives to traditional insurers — money that Republicans say won't be repaid.
"It is highly unlikely these loans will ever be fully repaid, and taxpayers will be forced to pay for the losses of these failed programs," Reps. Peter Roskam (R-Ill.), Kevin BradyKevin Patrick BradyHouse panel advances key portion of Democrats' .5T bill LIVE COVERAGE: Ways and Means to conclude work on .5T package LIVE COVERAGE: Tax hikes take center stage in Ways and Means markup MORE (R-Texas) and Adrian Smith (R-Neb.) wrote in their letter.
They also cited a damning report from the health department’s auditor earlier this summer, suggesting that financial problems are widespread. They said the report “unfortunately confirmed many of the concerns we have long expressed about the CO-OPs ability to repay federal loans.”
Government officials argue that the co-ops, which were established through a mostly unknown piece of ObamaCare, play an "important role" in increasing competition in the health law's marketplaces, HHS spokesman Ben Wakana said.
But the program has become the target of GOP scorn in recent months given its increasingly grim financial outlook.
While enrollment for the 23 co-ops has doubled over the last year, they ahve lost roughly $200 million in the first six months of the year. All but one of the 23 co-ops lost money last year.