Louisiana Health Cooperative becomes latest CO-OP to bite the dust
The Louisiana Department of Insurance announced that the state's consumer operated and oriented health plan (CO-OP), Louisiana Health Cooperative, will discontinue selling coverage at the end of 2015. Currently, 17,000 residents receive coverage from the CO-OP.
"It is a difficult time for health insurers of every size," Insurance Commissioner Jim Donelon said in the announcement. "The onerous burdens of Obamacare have shocked health insurance markets and caused instability in pricing and predictability, and as a result, we've seen premiums spike upward. Start-ups in insurance, especially health insurance, are always a tough row to hoe. Obamacare has made that even more difficult."
The CO-OP--which received nearly $66 million in funding from the Centers for Medicare & Medicaid Services--enrolled 7,773 consumers during the first round of open enrollment, falling short of its goal of 28,000, reports the Daily Signal.
Additionally, it's unclear whether the CO-OP will be able to repay the $66 million it received. However, Donelon did say that "we will continue to closely review the financial status of the company in order to work to ensure that the CO-OP has the financial ability to pay all claims."
In an analysis, the Daily Signal finds that out of the 23 CO-OPs created under the Affordable Care Act, only Maine Community Health Options was profitable last year.
While more than 1 million Americans enrolled in CO-OPs during the 2015 enrollment period--more than doubling 2014's 400,000 enrollees--CO-OPs across the country have been forced to cease operations due to financial concerns. Earlier this year, Tennessee's Community Health Alliance pulled its plans off the state's federally run exchange by freezing enrollment Jan. 15, FierceHealthPayer previously reported.
Over 1 million people enrolled in health insurance CO-OPs in 2015
Tennessee CO-OP freezes enrollment
Iowa's CO-OP pulls out of marketplace despite first-year success
Start up, CO-OP insurers are expanding into new markets