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October 17, 2015 08:02 AM UTC

Health Co-ops Designed to Fail?

  • 27 Comments
  • by: Davie

(“The GOP landmine was armed and planted” – Promoted by Colorado Pols)

A prophecy Congress fulfilled?
A prophecy Congress fulfilled?

Reading today’s coverage in the Denver Post of the shutdown of Colorado’s Non-Profit Heath Co-op left me wondering “Why?”

Other than the parenthetical note that Sen. Gardner called for “an investigation” a few days earlier, no historical background was provided in the reporter’s article that would indicate the cause for this mysterious and apparently unforseen terrible outcome affecting 80,000 Coloradans.

One quick Google search and the information the Post appears unaware of was published by the Washington Post almost exactly two years ago, explaining what Republicans who controlled congress at the time had in mind for these co-ops.

Although the co-op plan originated in the Senate, resistance to the initial proposal quickly materialized on Capitol Hill, in part because of pressure from insurance industry lobbyists.

So Congress saddled its new creations with onerous restrictions that, experts say, doomed many co-ops to failure. Federal grants for the co-ops were converted to loans with tight repayment schedules; they were barred from using federal money for crucial marketing; and they were severely limited from selling insurance to large employers, which represent the most lucrative market.

So I believe Sen. Gardner’s “investigation” should be fairly quick:

But Karen Davis, a professor of health policy management at the Johns Hopkins Bloomberg School of Public Health, said the co-ops were not designed with the support they need to thrive. “One provision after another got stuck in there to limit their probability of success,’’ she said. “It’s a little ironic to say you are for competition in the free market and then you don’t make it easy for new entrants.’’

The changes still rankle (former Democratic Senator) Conrad, who left the Senate in January. “The long knives were out for this,’’ he said in an interview. “No money could be used for marketing? Really? That was clearly intended to be a poison pill.’’

Last year, as Washington approached what was being called the “fiscal cliff,” the White House again put co-op funding on the table. With hours remaining before the deadline, Senate Mi­nority Leader Mitch McConnell (R-Ky.) buttonholed Democrats in a Capitol hallway and said, “We want the co-op money,” according to a person familiar with the negotiations. The White House agreed.

Republicans had Obama’s White House over a barrel due to the threatened GOP-driven government shutdown, so they caved on this funding.

The GOP landmine was armed and planted, waiting to go off at the most opportune time.

Sadly, as reported in the Denver Post, this didn’t need to happen:

HealthOP said Friday that projections by an independent actuary showed the insurer would make money in 2016, be able to add to its reserves and pay down the federal loans.

So, a program intended to help individuals and small businesses with affordable health coverage is now doing exactly what the GOP designed it to do — fail — and even better, waste taxpayer’s money to prove that their dystopian view of government prevails.

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27 thoughts on “Health Co-ops Designed to Fail?”

  1. I too was surprised to find nothing about the real reason for the feds refusal to come through in the Post article, having heard this Health Coop worker, a self described Republican, quoted while listening to CPR yesterday.  Of course the last thing that should surprise anyone anymore is the laziness of most newspaper journalism in general and the mediocrity of what passes for journalism in the Denver Post in particular. This is why I listen to to CPR's and NPR's in depth, long form news coverage. It's the best way to get the details and I often hear stories there a good week before any coverage turns up on any MSM platform.

    HealthOP’s senior IT manager Helen Hadji says it’s been an emotional ride for the co-op’s 80 or so employees.

    “I’m really sad,” she said.  And I’m sad because I really feel like we were doing something great to help Colorado and to help our members and to really make a difference.”

    Hadji says she’s a Republican but blames a Congress run by conservatives for not stepping up to help keep the co-operatives afloat. She had hoped HealthOP would survive and become a leader in the emerging health insurance landscape.

    “I feel like this is a federal failure.  I feel like Congress cannot work together.  This is all a political battle to dismantle Obamacare,” she said.

    – See more at: https://www.cpr.org/news/story/policy-holders-blindsided-insurer-healthop-s-failure#sthash.33ktmcnn.dpuf

    1. Given the ease with which I was able to find numerous sources with the background on why, how and by whom these co-ops were set up to fail, I don't believe the editors of the Post were caught by surprise at all.  Cory Gardner certainly wasn't.

      I wonder if the Denver Post should be reporting its news and editorial budget as an in-kind contribution to the Republican Party?

      1. It would seem so, wouldn't it?  And it's not like we're asking for the time, energy or level of personal risk involved in a Watergate investigation, afer all. We're  talking about a failure to do at least as much any amateur could do in a couple of minutes with any old search engine. What are these eople getting paid for? 

        1. oops. Hit the wrong thing and sent this before I could edit. That would be "after" and "people". But then, I'm not a paid professional journalist so I have an excuse.blush Also getting over the flu. 

          1. Hope you feel better soon and fire off a letter to the editors of the Post.  I'm pretty sure they wouldn't publish anything from me anymore. 

            They even deleted a couple of comments of mine from their Spot Blog simply because I pointed out a couple of their past missteps —  they didn't want to hear any "I told you so's".

            1. I might. They allow you no more than one a month.  My last one in was in September.  I usually get between eight and ten in per year. My experience might be helpful.

              The key is to severely edit yourself down to the 150 word limit which means no wandering from a single point. If you write a longer one they might publish it but they'll edit it to death. If you write a really long one they won't even bother with it unless you're someone locally important. If you are, you can get a pretty long one in, way over 150 words. I'm not.

              Avoid a lot of adjectives and especially adverbs. Shoot for about an 8th grade reading level. Shortish sentences without a lot of clauses and mainly active case. Be cool and calm. Use verfiable facts to back your point. Then, once again, edit mercilessly.

              The way I learned to write my pretty successful super disciplined letters to the editor bears little resembance to your familiar BlueCat's rantings. When I first started trying, my letters were rejected for quite some time before I hit on this formula that pretty much gets me one letter accepted any month I care to try.

              In between I sometimes write anyway just to add to the numbers they receive expressing our sides's views. That helps somebody else who supports what I support get a letter in. If they get a bunch of letters saying pretty much the same thing they'll pick one or a couple.

              So keep trying! 

              1. Excellent advice.  Now if I just had the patience and discipline to follow it 😉

                The dozen or so times I've been published in the Post and elsewhere came after a burst of inspiration and 10 minutes of impassioned writing, with about as much time spent editing afterwards.  Same with the diary I posted this morning.

    1. When the loudmouthed troll spews some bullshit, certainly no surprise that he has done it again.

      PissAnt, you are arguably the most intellectually lazy person on this site…you can do better than"profoundly stupid"….I don't think you ARE stupid..just morally and intellectually helpless…

    2. Why do you bother? Nobody cares about your latest stupid aphorism or cartoon, always completely unsupported. Righties are perfectly happy to accept any little gem their favorite Ditto Head uncle posts on FB, evidence free. You should stick with folks like that. Unlike everyone here except modster, who may as well be a very basic grade school project rightie program, they'll actually think you know WTF you're talking about. Woudn't you enjoy that, for a change? I'm only thinking of what's in your best interest, AC dear.

    3. ooh, ooh! I've got a better one. Wait, wait, this is really profound…. 

      "The higher, the fewer."  Must be spoken portentously.
      Alexander, son of Worf. (he actually stole it from a Holodeck program)

      Yours would sound better like this…

      "When the foundation of the structure is a lie, why the surprise when it crumbles, little grasshopper?" Better, right?

       

       

    4. Wow, AC.  That reply is not only lame, it doesn't even make much sense.  Are you really proud that your Republican Senators and Congressmen laid enough roadblocks insuring its failure, in front of a free market solution that was providing competitive health insurance coverage for tens of thousands of Colorado families and small businesses?

      Do you really think this latest "Fuck You" note from the Republican Party will go unnoticed by voters?  Given the death spiral in the quality of representation the GOP has provided nationally, regionally and locally for the last few decades, combined with the disastrously incompetent new wave of GOP candidates coming up out of the sewers, are you really proud to call yourself a Republican?

      It must really suck to be you.

      1. WTH is your solution, Carnegie? Gardner? Bueller?  Prior to ACA Colorado had upwards of 124,000 kids without insurance – enough to fill Mile High Stadium one and a half times over.  In this category we see the stark differences in the state divide: while only 3.2% of Douglas County residents rely on Medicaid, the Otero-Baca corridor averages 21.6%, nearly double the state average of 11.6%.  Medicaid, like food assistance, is a lifeline to so many of the most challenged amongst us. 

        Not even that fact stopped Gardner from voting 60+ votes to repeal (and replace) as the political steward of CD4.

        PS: Gardner, as political steward of CD4 also supported the gutting of SNAP, even though 109,326 children in his then-district lived in child poverty and 188,850 who depend on reduced lunch pricing.  That's enough children living in poverty to populate 31 cities the size of his hometown of Yuma, Colorado. 

        There really are no words for your ilk.

        2. AC's reply was as vague as a fortune cookie, so while multiple interpretations are possible, I doubt he was conceding anything that would reflect badly on his party.

          It's not allowed in his job description.  You wouldn't want to see him get fired, would you?

  3. Thanks for doing the digging, Davie. Much appreciated. 

    As a co-op customer, I'm really upset. I've never liked an insurance company before, but they put people before profits and I really liked that. 

    Scoring political points at the expense of the public. It's the Republican Way.

  4. Colorado HealthOP has sued the Colorado Division of Insurance in Federal court this morning in an effort to allow the non-profit health insurance co-op to continue serving 80,000 Coloradans. 

    1. Excellent!  But while their cause is just, and common sense would dictate they prevail given the independent actuarial projections of their fiscal health, I have to wonder if the laws were written to stack the deck against any possible judicial remedy.

      But if nothing else, it will keep the discussion in the public eye where it belongs.

      1. There's no question, per the research you've done, that the plan from the Republican side is to make the co-ops fail, then crow about how it's an indictment of Obamacare. It is wildly obvious. 

        1. To have any chance of success, they'd have to show that the criteria used to shut them down — solvency vs. cash flows projecting viability — are not correct.  Also, at the 12% level of funding, do those projections still hold true?  If not who/where would they get the needed funds?  And with open enrollment starting Nov 1st, they need an emergency injunction to allow them to sell policies next year.

          Definitely an uphill battle.  I wish them all success.

          1. For the ACA to have had any chance of success, it needed to have some level of bipartisan buy in.  We are just seeing the random flailing about associated with its preordained fate.

              1. Yep, AC's joke about bipartisan buy-in was hilarious!

                That boy's got a real sense of humor, doesn't he? 😉

                But I have to admit, that joke is getting pretty old. But what is the GOP if not simply a has-been party full of recycled, useless ideas.

            2. Are you some alternate universe AC that just appeared from 2010?

              17.6 million people that are covered expressly due to ACA would reject the premise of your statement:

               As of March 2015 HHS reported a total of 16.4 covered due to the ACA between the Marketplace, Medicaid expansion, young adults staying on their parents plan, and other coverage provisions. This number was reported by HHS to have rose to 17.6 million according to September 2015 data.

              According to Gallup the uninsured rate was 11.9% for the 18 – 65 demographic in the 1st quarter of 2015, down from a high of 18% in 2013. By the second quarter of 2015 the uninsured rate fell to 11.4%.

              http://obamacarefacts.com/sign-ups/obamacare-enrollment-numbers/

              If you want to whine about ACA, I'm surprised you are complaining that the ACA is contributing to overpopulation because 45,000 people that "should've died" without medical coverage each year haven't.

              http://news.harvard.edu/gazette/story/2009/09/new-study-finds-45000-deaths-annually-linked-to-lack-of-health-coverage/

               

          2. Asking because I have no idea:

            Apparently there were three or four alternatives for funding (angel/VC financing, which was specifically prohibited for the co-ops; a merger offer on the table with a similar non-profit; etc.)… would the viability of any of these alternatives make it more possible to be successful in this federal case? 

            Re: solvency and cash flows, they were on track to pay back the loans ahead of the (very short, as you mentioned) schedule, in full, next year. 

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