The 19th co-op since the creation of Obamacare has announced it will cease offering services at the end of 2017. Known as the “Minuteman Health of Massachusetts and New Hampshire,” this co-op will look to reorganize as a new venture to be called the “Minuteman Insurance Company.”
According to the Washington Free Beacon,
“The company cited issues with Obamacare’s risk-adjustment program, which is the program that shifts money away from those with healthier customers to those with sicker enrollees. Minuteman Health said that the negative impact of this program had been “substantial.”
“Unfortunately, the program has not worked as intended,” the company said. “It has been difficult for insurers to predict their risk-adjustment obligations, which has led some to withdraw from the ACA market.”
“The program also unfairly penalizes issuers like MHI that are small, low cost, and experience high growth,” the company said. “The significant relative impact from risk adjustment has been the principal driver of a reduction in MHI’s surplus and capital over 2 [sic] time.”
The co-op was able to grow to 37,000 members since it began in 2014 but said that being subject to certain co-op rules made it hard to adjust its business model to mitigate issues with the risk-adjustment program. The co-op was awarded $156.4 million in taxpayer-funded loans in 2012 and 2013.
The new company, Minuteman Insurance Company, will not be subject to these rules.
The ill-effects of the atrocious Obamacare legislation continues to disrupt lives. You’ll never hear about these failed co-ops, long considered a “jewel” of the program. How can any one rationally defend a 17% success rate for health care reform?