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Collapse of KY Health Co-op Emblematic of Obamacare’s Broken Promises

Collapse of KY Health Co-op Emblematic of Obamacare’s Broken Promises

Bill Stephens

October 22nd, 2015

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WASHINGTON, D.C. – U.S. Senate Majority Leader Mitch McConnell made the following remarks on the Senate floor today regarding the collapse of the Kentucky health Co-op:

“Barely a week goes by that we don’t see another harmful consequence of Obamacare, a poorly conceived and badly executed law.

“It’s caused costs to increase for millions of Americans.

“It’s harmed the quality and availability of care.

“Now comes further evidence that Obamacare is a mess of a law, filled with broken promises.

“Recently we learned that the Kentucky Health Cooperative, a nonprofit health insurer created by Obamacare with federal taxpayer funds, will cease operations and stop offering health plans at the end of the year. For the second time in as little as three years, as many as 51,000 Kentuckians will lose the health care coverage they currently have and will be forced to choose a new plan — all thanks to Obamacare.

“This Kentucky Co-op was a boondoggle from the start. It received nearly $150 million in federal loans, including a solvency loan this past November in a failed taxpayer bailout to keep it afloat. It had the largest recorded loss of all 23 co-ops nationwide, more than $50 million in 2014.

“Things were hardly much better for Kentuckians enrolled in it.

“Over the past two years the Co-op saw double-digit premium increases on the individual market. If it had survived, it was planning on increasing premiums for its members by 25 percent in 2016.

“Here’s what the Kentucky Co-op’s CEO said about this particular government-subsidized health care plan: ‘In plainest language, things have come up short of where they need to be.’

“If only we could have that kind of honesty from the Obama Administration on the many failures of Obamacare.

“The collapse of the Kentucky Co-op is emblematic of the situation across the country. The Obama Administration claimed that their government-subsidized co-ops would provide affordable and sustainable alternatives to private insurance. The truth is anything but. And what’s even more disappointing is that the Obama Administration itself predicted a nearly 40 percent default rate on its taxpayer loans to co-ops.

“Twenty-one of 23 co-ops nationwide were losing money as of the end of last year. And enrollment in these co-ops fell below projections for the majority of plans.

“Kentucky’s neighbor to the south, Tennessee, will shut down its co-op, leaving approximately 27,000 enrollees looking for new coverage at the end of the year.

“In Colorado, that state’s biggest health insurer on their exchange – a nonprofit co-op – also announced its closure this month, forcing 83,000 Coloradans to find new insurance for next year.

“The same is true in Iowa, Nebraska, Nevada, Oregon and Louisiana.

“From the Bayous of Louisiana to the Pacific Northwest.

“From the Big Apple to the Great Plains and the Rocky Mountains.

“Obamacare’s co-ops are failing.

“In all, one-third of the 23 Obamacare health co-ops have failed, leaving about 400,000 policyholders nationwide looking for new coverage for 2016.

“These failures of Obamacare health co-ops come as no surprise to those of us who predicted that giving the government more control of our health care system would be detrimental to the health care coverage people rely on. I said so on the Senate floor as far back as 2009.

“The administration knew beforehand that this plan was not viable and that tens of thousands of people could lose their coverage. They chose to cling fast to a disastrous left-wing experiment with our health care system over choosing stability and affordable coverage for the many people caught up in Obamacare and these failed health care co-ops.”

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