White House Not Onboard Democrats’ Platform Demand for Taxpayer-Funded Abortion

Although Barack Obama has been staunchly pro-choice during his presidency, the White House this week cited a “longstanding view” that doesn’t support federal taxpayer funding of abortions—a change embraced at the Democratic National Convention as part of the party’s platform.

“I don’t believe we have changed our position on the Hyde Amendment, but if we do, you’ll be the first to know,” White House deputy press secretary Eric Schultz told The Daily Signal on Tuesday.

The Hyde Amendment, in effect since 1976 and named for the late Rep. Henry Hyde, R-Ill., prohibits the use of federal money for abortion except in cases of rape, incest, or when the mother’s life is at stake.

The congressional appropriations rule generally has been a consistent “policy rider” on funding bills that has bipartisan support, including from lawmakers who support abortion.

The Democratic Party’s move was unprecedented in the wake of previous platforms that called for abortion to be “safe, legal, and rare.”

Obama signed an executive order in 2010 to apply the Hyde Amendment to Obamacare, so that he could secure needed votes from moderate Democrats to pass the health care law.

Last year, the White House spoke out against attempts to defund Planned Parenthood by explaining federal funds generally could not be used to pay for abortion.

We have a longstanding view on this, and I don’t have any changes in our position to announce today,” Schultz told The Daily Signal.

A poll by Marist Institute for Public Opinion, released Monday, found 62 percent of Americans oppose taxpayer funding of abortion.

The poll also found that 45 percent of pro-choice Americans oppose taxpayer-funded abortion, as do 65 percent of African-Americans and 61 percent of Latinos. Fully 44 percent of Democrats oppose federal funding of abortion.

The post White House Not Onboard Democrats’ Platform Demand for Taxpayer-Funded Abortion appeared first on The Daily Signal.

16 Obamacare Co-Ops Collapsed. Here’s How the Rest Are Faring

Since Obamacare’s rollout in the fall of 2013, 16 co-ops that launched with money from the federal government have collapsed.

The co-ops, or consumer operated and oriented plans, were started under the Affordable Care Act as a way to boost competition among insurers and expand the number of health insurance companies available to consumers living in rural areas.

Now, just seven co-ops—Wisconsin’s Common Ground Healthcare Cooperative; Maryland’s Evergreen Health Cooperative; Maine Community Health Options; Massachusetts’ Minuteman Health; Montana Health Cooperative; New Mexico Health Connections; and Health Republic Insurance of New Jersey—remain.

Despite the grim financial footing from previous years, health care experts agree that it’s likely some—though not all—co-ops may remain standing for at least a few more years.

“I definitely think there are some co-ops that have seemed to have relative success in the market,” Caroline Pearson, a senior vice president at Avalere Health, told The Daily Signal. “I think we will have a some surviving co-ops a couple years from now, but I can’t promise we won’t have a handful more that may fail over time.”

But for the seven co-ops left to survive, Pearson warned they will have to increase the cost of their premiums,especially since many of the nonprofit insurers kept the costs down during the beginning years of Obamacare’s implementation to attract customers.

“The big issue for the co-ops is getting the pricing right,” she said. “They really need to make sure they’re accurately assessing the medical risk of the exchange enrollees and pricing in such a way they can cover those costs.”

“I think there was very aggressive pricing strategies by many carriers in the first few years of the exchanges to try to win enrollment, and that’s really resulted in big losses for most of them,” Pearson continued.

Struggling to Make Money

The Centers for Medicare and Medicaid Services awarded $2.4 billion to 23 co-ops that were eventually created. However, the majority of the co-ops struggled to turn a profit, resulting in the collapse of 16 of the original 23 that received $1.5 billion in startup and solvency loans.

Now, with just seven co-ops remaining, regulatory filings show that many ended 2015 in the red.

Maine Community Health Options ended up losing money in 2015 after having a successful 2014.

The Maine co-op was the only one to make money in 2014 and hit its enrollment targets. But by the end of 2015, Maine Community Health Options’ finances took a turn for the worse and the co-op lost $74 million.

Already, regulatory filings for the first three months of 2016 show Maine Community Health Options posting more than $8 million in losses.

Officials with Maine Community Health Options did not return The Daily Signal’s request for comment.

Pearson said the Maine co-ops’ early success can be attributed to the state’s insurance market.

“The advantage of Maine is it is a relatively noncompetitive, or less competitive market,” she said. “It makes it easier for co-ops to enter the market and win market share because there aren’t so many entrenched companies.”

Wisconsin’s co-op, Common Ground Healthcare Cooperative, initially exceeded its enrollment projections in both 2014 and 2015.

However, the co-op ended up losing $43.2 million last year, according to the Milwaukee Journal Sentinel.

For the first three months of 2016, Common Ground Healthcare Cooperative reported losses of $4.7 million, according to regulatory filings.

Thomas Miller, a resident fellow at the American Enterprise Institute who is an expert in health policy, said each of the seven remaining co-ops have “warning indicators” leading up to when, and if, they fail.

“As a general rule, this has already been the case with the ones that have failed to a large extent, usually the ones that grew the fastest and were the biggest were the ones that had the most problems,” he told The Daily Signal.

Miller specifically referenced the Health Republic of New Jersey, which made money in the first nine months of 2015, as an example of a co-op that grew quickly but shows warning signs of collapsing.

The co-op said it lost $17.6 million at the end of 2015 and is facing a $46.3 million payment to the government through the risk adjustment program, which was designed to spread risk among insurers.

To the contrary, Miller pointed to Maryland’s Evergreen Health and New Mexico Health Connections as two co-ops that could live on for a few more years.

“If you’re small, you can sometimes survive because the magnitude of your losses aren’t to the extent that the state insurance commissioner feels like, ‘Oh my gosh, this is really going to be bad for us and we really have to pull out before the open enrollment season,’” he said.

Still, Miller said it would be difficult for the co-ops that have been hemorrhaging money consistently over the years to recover.

“When they’re bleeding, they keep bleeding, and they continue bleeding, and at some point you have to cart them away,” he said.

160715_Obamacare-Co-Ops

Weathering the Years

Since Obamacare’s implementation, it’s not only co-ops that have struggled to make money.

Oscar, a startup insurance company serving New York and New Jersey that launched in 2012, lost $105 million in 2015.

Additionally, UnitedHealthcare CEO Stephen Hemsley said the company expects to lose more than $1 billion from its exchange business—$650 million in 2016 and $475 million in 2015.

The company, which is the nation’s largest insurer, decided to pull out of at least 26 of the 34 exchanges it offered coverage on last year after warning the marketplaces were a risky investment.

And Health Care Service Corporation, which operates Blue Cross Blue Shield plans in five states, reported losses totaling $65.9 million in 2015. The company lost $281.9 million in 2014.

Despite across-the-board losses for insurers of all sizes, both startups and established insurance companies have been able to remain afloat while the majority of the co-ops collapsed

“The benefit that these co-ops didn’t have, in addition to just fiscal reserves, was a diversity of markets they’re participating in,” Pearson said. “Lots of exchange plans have financial difficulty, but they could rely on their broad book of business to weather the initial years of challenge. Co-ops haven’t had that chance.”

In addition to increasing the cost of their premiums to compensate for their beginning years of  enrollment, Pearson said the co-ops may also need to bump prices up to prepare for the end of the risk corridor and reinsurance programs, which were put in place until the end of this year.

The risk corridor and reinsurance programs are two of the “three R’s”—risk adjustment being the third—designed to spread risk among insurance companies enrolling consumers through the exchanges.

The co-ops received less money than they initially anticipated last year under Obamacare’s risk corridor program, which resulted in the collapse of at least five co-ops and a $5 billion-class action lawsuit filed by Health Republic of Oregon, one of the state’s co-ops.

The reinsurance program, meanwhile, has helped the co-ops, albeit marginally. According to data released by the Department of Health and Human Services last month, the seven remaining co-ops could collectively receive $132.3 million in payments from the reinsurance program.

But with the end of the reinsurance program coming at the end of the year, the additional infusion of cash to the co-ops will go with it.

“The risk corridor, everybody has sort of already written off,” Pearson said, “but the lack of reinsurance is a challenge, especially for small plans and again sort of underscores the need for a big rate bump.”

Still, Miller said even if the co-ops raise their premiums, it’s unlikely the remaining seven will be able to turn their businesses around.

“When you’ve got a terminal illness, it is going to catch up eventually. Whether some can go into remission or basically string it along for a stretch of time, we always get these periodic predictions that, ‘Oh, if we just have next year it’ll be different,” he said. “There’s just not something on the horizon. There’s just not some other approach that seems viable as to how they get out of the box they’re already in.”

The post 16 Obamacare Co-Ops Collapsed. Here’s How the Rest Are Faring appeared first on The Daily Signal.

How Democrats Came to Embrace Taxpayer-Funded Abortions

President Barack Obama signed an executive order in 2010 applying the Hyde Amendment, which bans taxpayer funding of most abortions, to Obamacare.

The White House referred to the Hyde Amendment while defending taxpayer funding of Planned Parenthood. Now, the Democrats’ party platform is calling for repeal of the measure.

“Most Americans don’t want public funding of abortion at home or abroad,” @ProLifeDem says.

According to a new poll, Americans are solidly opposed to public funding of abortion, including nearly half of voters who support abortion rights, and at least four out of 10 Democrats.

The Hyde Amendment, in effect since 1976 and named for the late Rep. Henry Hyde, R-Ill., prohibits the use of federal money for abortion, except in cases when the mother’s life is at stake, or in cases of rape or incest. The appropriations rule generally has been a consistent rider to funding bills with bipartisan support, including lawmakers who support abortion.

But now Democrats are shifting their stance. The party’s 2016 platform states:

We believe unequivocally, like the majority of Americans, that every woman should have access to quality reproductive health care services, including safe and legal abortion—regardless of where she lives, how much money she makes, or how she is insured. We believe that reproductive health is core to women’s, men’s, and young people’s health and wellbeing. We will continue to stand up to Republican efforts to defund Planned Parenthood health centers, which provide critical health services to millions of people. We will continue to oppose—and seek to overturn—federal and state laws and policies that impede a woman’s access to abortion, including by repealing the Hyde Amendment.

That’s in the face of 62 percent of Americans who say they oppose taxpayer funding of abortion, according to a poll of 1,009 adults by the Marist Institute for Public Opinion, released Monday.

Further breakdown shows 45 percent of pro-choice Americans oppose taxpayer-funded abortion; 65 percent of African Americans oppose it, and so do 61 percent of Latinos. Fully 44 percent of Democrats oppose federal funding of abortion, the poll found.

“Without President Obama’s executive order expanding the Hyde language, we would not have been able to get the ACA [Affordable Care Act] passed in 2010,” Kristen Day, executive director for Democrats for Life of America, told The Daily Signal in a phone interview.

Day, who is attending the Democratic National Convention this week in Philadelphia, added: “Most Americans don’t want public funding of abortion at home or abroad.”

One-third of Democrats, or about 23 million, are pro-life, according to Democrats for Life. But Day is worried such a hardline platform will alienate too many voters.

Obama’s executive order, which reassured moderate Democrats to vote for the Affordable Care Act, or Obamacare, states:

Following the recent enactment of the Patient Protection and Affordable Care Act … , it is necessary to establish an adequate enforcement mechanism to ensure that federal funds are not used for abortion services (except in cases of rape or incest, or when the life of the woman would be endangered), consistent with a longstanding federal statutory restriction that is commonly known as the Hyde Amendment. … The [Affordable Care] Act maintains current Hyde Amendment restrictions governing abortion policy and extends those restrictions to the newly created health insurance exchanges.

During the debate over Obamacare, Obama said: “There are no plans under health reform to revoke the existing prohibition on using federal taxpayer dollars for abortions. Nobody is talking about changing that existing provision, the Hyde Amendment. Let’s be clear about that. It’s just not true.”

Douglas Johnson, legislative director for the National Right to Life Committee, told The Daily Signal that Obama chose to “hide behind the Hyde Amendment” with Obamacare, using a “phony executive order” that wasn’t fully enforced.

“The Hyde Amendment is the most successful abortion reduction program,” Johnson said in a phone interview. “Conservatively, there are 1 million Americans walking around today because of the Hyde Amendment, possibly 2 million.”

Last year, after hidden-camera videos seemed to show officials at Planned Parenthood clinics talking about selling the body parts of aborted babies, the Obama administration stepped up to defend the nation’s largest abortion provider.

In defending federal funding for Planned Parenthood Federation of America, White House press secretary Josh Earnest stressed that current law prevents tax dollars from funding abortions. At an October press briefing, Earnest said:

The president would strongly oppose and would even veto a piece of legislation that would result in the wholesale defunding of Planned Parenthood and it warrants mentioning at this point, that there is a provision of federal law that prevents federal funds from being used to perform abortions. That is a law that’s been on the books for quite some time. And it’s a law that’s been enforced by the Obama administration. And it’s why this rhetoric emanating from Republicans about wanting to defund Planned Parenthood because Planned Parenthood carries out abortions is fundamentally dishonest.

Several Democrat lawmakers expressed opposition to calling for repeal of the Hyde Amendment in the party platform.

Sen. Bob Casey, D-Pa., wrote a letter to the platform committee saying, “This is a consensus-based policy that has, for many years, prohibited the use of federal funds to pay for abortion.”

In addition to calling for federal funding, the Democrats’ 2016 platform has an abortion-related litmus test for judicial nominees, stating: “We will appoint judges who defend the constitutional principles of liberty and equality for all, and will protect a woman’s right to safe and legal abortion … ”

The party’s platform has moved significantly toward the pro-choice position since candidate Bill Clinton called for abortion to be “safe, legal, and rare” in his acceptance speech at the 1992 Democratic National Convention.

In 1996, 2000, and 2004, the term “rare” was part of the platform in describing abortion.

While the Marist poll finds 51 percent identify themselves as pro-choice, it also finds that 78 percent support some restrictions on abortion.

“The American people have spoken clearly on their desire for abortion restrictions, less taxpayer funding of it, and commonsense regulations on this industry to protect women’s health,” said Carl Anderson, chief executive of Knights of Columbus, the Catholic fraternal organization that sponsored the poll. “Our courts, politicians, candidates, and parties should heed this consensus.”

The Hyde Amendment has been long-standing consensus, said Mallory Quigley, communications director for the Susan B. Anthony List, a pro-life group. She added: “The Republican platform is more pro-life than it has ever been.”

The Republican Party platform says:

 We oppose the use of public funds to perform or promote abortion or to fund organizations, like Planned Parenthood, so long as they provide or refer for elective abortions or sell fetal body parts rather than provide health care. We urge all states and Congress to make it a crime to acquire, transfer, or sell fetal tissues from elective abortions for research, and we call on Congress to enact a ban on any sale of fetal body parts. In the meantime, we call on Congress to ban the practice of misleading women on so-called fetal harvesting consent forms, a fact revealed by a 2015 investigation. We support the appointment of judges who respect traditional family values and the sanctity of innocent human life. … We support the appointment of judges who respect traditional family values and the sanctity of innocent human life.

Here’s a look at abortion language in Democratic Party platforms adopted from the time Bill Clinton was nominated for president until now, when his wife Hillary Clinton is about to be nominated.

1992 platform:

Democrats stand behind the right of every woman to choose, consistent with Roe v. Wade, regardless of ability to pay, and support a national law to protect that right. It is a fundamental constitutional liberty that individual Americans—not government—can best take responsibility for making the most difficult and intensely personal decisions regarding reproduction. The goal of our nation must be to make abortion less necessary, not more difficult or more dangerous.

1996 platform:

Our goal is to make abortion less necessary and more rare, not more difficult and more dangerous. We support contraceptive research, family planning, comprehensive family life education, and policies that support healthy childbearing. For four years in a row, we have increased support for family planning. The abortion rate is dropping. Now we must continue to support efforts to reduce unintended pregnancies, and we call on all Americans to take personal responsibility to meet this important goal.

2000 platform:

The Democratic Party stands behind the right of every woman to choose, consistent with Roe v. Wade, and regardless of ability to pay. … Our goal is to make abortion less necessary and more rare, not more difficult and more dangerous. We support contraceptive research, family planning, comprehensive family life education, and policies that support healthy childbearing. The abortion rate is dropping. Now we must continue to support efforts to reduce unintended pregnancies, and we call on all Americans to take personal responsibility to meet this important goal.

2004 platform:

Because we believe in the privacy and equality of women, we stand proudly for a woman’s right to choose, consistent with Roe v. Wade, and regardless of her ability to pay. We stand firmly against Republican efforts to undermine that right. At the same time, we strongly support family planning and adoption incentives. Abortion should be safe, legal, and rare.

2008 platform:

The Democratic Party strongly and unequivocally supports Roe v. Wade and a woman’s right to choose a safe and legal abortion, regardless of ability to pay, and we oppose any and all efforts to weaken or undermine that right.

2012 platform:

Abortion is an intensely personal decision between a woman, her family, her doctor, and her clergy; there is no place for politicians or government to get in the way. We also recognize that health care and education help reduce the number of unintended pregnancies and thereby also reduce the need for abortions. We strongly and unequivocally support a woman’s decision to have a child by providing affordable health care and ensuring the availability of and access to programs that help women during pregnancy and after the birth of a child, including caring adoption programs.

2016 platform:

We will appoint judges who defend the constitutional principles of liberty and equality for all, and will protect a woman’s right to safe and legal abortion. … We believe unequivocally, like the majority of Americans, that every woman should have access to quality reproductive health care services, including safe and legal abortion—regardless of where she lives, how much money she makes, or how she is insured. We believe that reproductive health is core to women’s, men’s, and young people’s health and wellbeing. We will continue to stand up to Republican efforts to defund Planned Parenthood health centers, which provide critical health services to millions of people. We will continue to oppose—and seek to overturn—federal and state laws and policies that impede a woman’s access to abortion, including by repealing the Hyde Amendment.

Pro-choice activists demonstrate in front of the Supreme Court on June 27, 2016. Critics call this year’s Democratic platform the most pro-abortion ever. (Photo: Bill Clark/CQ/Roll Call/Newscom)

The post How Democrats Came to Embrace Taxpayer-Funded Abortions appeared first on The Daily Signal.

What’s Behind Obama’s Obsession With the Public Option

President Barack Obama is calling for the resurrection of his failed “public option” ( a “Medicare-like” plan) to compete directly against private health  plans in his government- run health insurance exchanges.

“The public plan did not make it into the final legislation,” the president writes in the Journal of the American Medical Association. “Now, based on the experience with the ACA [Affordable Care Act], I think Congress should revisit a public plan to compete alongside private insurers in areas of the country where competition is limited. Adding a public plan in such areas would strengthen the Marketplace approach, giving consumers more affordable options while also creating savings for the federal government.”

Yeah… right.

The Left’s Long Pursuit of a Public Option

The president’s latest appeal for Congressional creation of a “public option” is no more convincing today than it was when he originally proposed it.  It was included in the very first legislative version of Obamacare in 2009, and by 2010 it became a standardized feature of leftist health policy in Congress.

The provision was, however, unable to secure enough Congressional Democratic support. The final version of Obamacare was enacted without the provision. The national health law eventually passed on a narrowly partisan basis, in the teeth of popular opposition,  and further polarized the country.

But there’s a reason Obama is circling back to the public option, even though he couldn’t get it through Congress.

If a public option became part of government-run health, the Health and Human Services secretary would establish such a plan, set its benefits, and fix its payment rates. While private plans must negotiate market rates with doctors and hospitals, a Medicare-like “public option” would fix payment rates by fiat, well below the rates that would otherwise prevail in a real market.

There’s an important backstory to this initiative. The combo of a “public option” in a “public exchange” was originally developed by liberal health policy analysts as a dual action mechanism to secure a “single payer” system: a full-scale government monopoly. Backed by the full power of the government, and fixing payment rates below normal market levels, the “public option” would crowd out private coverage, resulting in greater concentration in the market, less choice for patients and less competition among plans, until only the government health plan would remain. Voila, monopoly!

Ultimately, the real point of the “public option” is to destroy private health insurance, crowding it out through administrative, regulatory, and financial disadvantages, and to insulate it from real free market competition on a level playing field.

Public Option Could Put Taxpayer Dollars at Risk

Aside from other concerns any public option would involve real financial risk. Private plans, in a properly functioning market assume and manage the financial risks.

But under the very first legislative version of Obamacare, specifically Section 221 of the Tri-Committee Draft Proposal for Health Care Reform, the taxpayers were to be stuck with entire risk of the public plan. In June 23, 2009 testimony, I told the House Education and Labor Committee: “Since private health plans competing with the public plan have no such taxpayer guarantee, regardless of the wisdom or folly of providing such a guarantee, the public plan would have an advantage incompatible with the goal of a level playing field.”

Using  a market mechanism, like a “health insurance exchange”, then  adding a “public option” to undercut private plans and destroy a competitive private market was a political strategy.  All the public relations rhetoric about expanded “consumer choice”, promoting “market competition”, keeping private  plans “honest”  was, of course, classic boob bait.

In a sense, the president’s call for a reintroduction of a public plan is redundant. Obamacare itself is a public option. The federal government mandates coverage, defines what plans are permissible, determines what health benefits, medical procedures or treatments must be covered, what levels of coverage are acceptable, and what copayments and deductibles are allowable.

For the Obama administration and its allies in Congress and elsewhere, the law secures the main objective: a high degree of political control over the health care sector of the economy. The results were predictable: restrictions on liberty,  rising costs, reams of red tape, reduced competition, unworkable or unenforceable provisions, routine executive overreach, dysfunctional insurance exchanges, special interest deals and insurance company bailouts. In such a bureaucratic system, one’s personal preferences don’t count. That’s not a bug, it’s a feature.

The post What’s Behind Obama’s Obsession With the Public Option appeared first on The Daily Signal.

The 15th Obamacare Co-Op Has Collapsed. Here’s How Much Each Failed Co-op Got in Taxpayer-Funded Loans.

Another co-op is shutting down, becoming the 15th to do so and bringing the total number of federal loans given to the failed nonprofit insurers to more than $1.5 billion.

Oregon’s Health Co-Op announced last week it will no longer be able to continue operating and will be shutting down. The insurance company is the third in the state to struggle financially and Oregon’s second co-op, following Health Republic Insurance of Oregon, to close its doors.

Oregon’s Health Co-Op’s closure affects more than 20,000 consumers living in the state, and customers have been advised to select new plans by July 31.

“It is with great sadness that I announce Oregon’s Health Co-Op is shutting down its doors immediately,” Phil Jackson, the co-op’s chief executive officer, said in a statement. “The board of directors agreed that it is in the best interests of our members and community that we wind down our operations.”

Oregon’s Health Co-Op was one of 23 co-ops that launched under Obamacare. The co-ops, or consumer operated and oriented plans, were intended to create competition and choice in areas of the country where consumers had few options.

The 23 co-ops—not including Vermont’s co-op, which never opened its doors—received $2.4 billion in startup and solvency loans from the Centers for Medicare and Medicaid Services.

The 15 co-ops that have since closed their doors received more than $1.5 billion in loans. The federal government awarded Oregon’s Health Co-Op specifically $56.6 million.

The Centers for Medicare and Medicaid Services has not yet said if the money given to the failed co-ops will be recouped.

Oregon’s Health Co-Op lost $18.4 million in 2015, the bulk of which the nonprofit insurer attributed to high medical claims from its policyholders. The co-op also pointed to money it owes the federal government through its risk adjustment program as delivering the final blow to its bottom line.

The risk adjustment program redistributes money from insurers with healthy customers to those with sicker, most costly customers.

Officials with Oregon’s Health Co-Op expected to receive $5 million from the risk adjustment program. But late last month, the Centers for Medicare and Medicaid Services said the co-op would instead owe $900,000.

“The result is a sudden deterioration of the company’s financial position that cannot be sustained and the company must stop doing business,” the co-op said in an announcement to customers.

One other co-op, HealthyCT, also closed its doors because of money it owes through the risk adjustment program. Two others, Maryland’s Evergreen Health and Illinois’ Land of Lincoln Health, have since taken action to prevent the collection of the risk adjustment payments.

Health policy experts expect more co-ops to collapse in the wake of the federal government’s announcement.

Just eight of the 23 co-ops that launched remain.

160712_Obamacare-Co-Ops_v2

The post The 15th Obamacare Co-Op Has Collapsed. Here’s How Much Each Failed Co-op Got in Taxpayer-Funded Loans. appeared first on The Daily Signal.

Obamacare’s 14th Co-Op Is Closing Its Doors, and at Least 2 More Could Close Soon

Another Obamacare co-op, Connecticut’s HealthyCT, is closing its doors, and at least two most could follow suit as the nonprofit insurers decide whether they will be able to remain on firm financial footing.

The nine remaining co-ops of the original 23 co-ops must make payments totaling at least $130 million through Obamacare’s risk adjustment program, which could damage their viability.

The Connecticut Insurance Department announced Tuesday that HealthyCT was placed under state supervision, leaving approximately 40,000 Connecticut residents to find new health insurance during the next open enrollment period.

HealthyCT is the 14th co-op created under Obamacare to fail since the health care law’s exchanges opened in 2013.

The co-ops, or consumer operated and oriented plans, were created to inject competition and choice in areas where little existed. The Centers for Medicare and Medicaid Services awarded the 23 co-ops $2.4 billion in startup and solvency loans to help the new nonprofit insurance companies get off the ground.

However, more than half of the co-ops have failed to succeed in the health insurance market, despite the $1.5 billion in loans the 14 collapsed co-ops collectively received.

HealthyCT alone received nearly $128 million in loans, which included an infusion of $48.4 million in solvency loans awarded in September 2014.

Katharine Wade, state insurance commissioner, said HealthyCT’s “hazardous financial condition” led her to close the co-op’s doors. The nonprofit insurer’s financial issues were compounded after the Centers for Medicare and Medicaid Services announced last week the payments insurers must make under Obamacare’s risk adjustment program.

The Department of Health and Human Services asked HealthyCT to pay $13.4 million into the risk adjustment program, which redistributes money from insurers with healthy customers to insurers with sicker, more costly consumers.

“Unfortunately HealthyCT’s financial health is unstable, having been seriously jeopardized by a federal requirement issued June 30, 2016, that it pay $13.4 million to the U.S. Department of Health and Human Services, Centers for Medicare & Medicaid Services as part of the Affordable Care Act’s risk adjustment program,” Wade said in a statement Tuesday. “As a result, it became evident that this risk adjustment mandate would put the company under significant financial strain.”

The payments into the risk adjustment program ultimately sealed HealthyCT’s fate, and could do the same for some of the nine remaining co-ops.

Health Republic Insurance of New Jersey has to pay the most, $46.3 million, through the risk adjustment program, which is one of three programs designed to mitigate risks for insurers.

Only one of the remaining nine co-ops, Maine Community Health Options, is receiving money from the program. The co-op will get just over $700,000 from the Department of Health and Human Services.

“Contrary to everything CMS keeps saying, it looks like the risk adjustment program is not working and is harming smaller insurers, including the co-ops, and not just the co-ops,” Ed Haislmaier, Heritage Foundation senior fellow in health policy studies, told The Daily Signal. “So in some cases, the need to make risk adjustments payments may push them over the edge.”

Already, two of the remaining nine co-ops have taken steps to halt the collection of payments they owe to the federal government for the risk adjustment program.

Last month, Maryland’s Evergreen Health Cooperative filed a lawsuit in U.S. District Court against the Department of Health and Human Services and Centers for Medicare and Medicaid Services over the risk adjustment program.

The lawsuit argues that the formula the federal government uses for calculating risk adjustment payments gives larger insurance companies with deeper pockets an advantage over smaller insurance companies like the co-ops.

In their lawsuit, Evergreen Health asks the court to prohibit the federal government from collecting risk adjustment payments “calculated under the CMS’s arbitrary, capricious, and unlawful implementation” of the program.

According to court filings, Evergreen Health expected to pay roughly $22 million to the federal government. The Centers for Medicare and Medicaid Services requested $24 million from the co-op in risk adjustment payments—approximately 30 percent of what the nonprofit insurer made in revenue from premiums.

If Maryland’s co-op is required to make its $24 million payment to the government, Evergreen officials warned in court documents that its financial future may be in jeopardy.

Like Evergreen Health, Illinois’ co-op, Land of Lincoln Health, could find itself in trouble if the co-op makes its risk adjustment payment.

The co-op must make a $31.8 million payment to insurers with most costly customers through the risk adjustment program. However, Illinois Department of Insurance Acting Director Anne Melissa Dowling sent a letter to the Centers for Medicare and Medicaid Services last week saying her agency ordered Land of Lincoln Health to withhold making its risk adjustment payment.

Dowling said she was doing so to “preserve the solvency” of the co-op and prevent it from having to close its doors mid-year.

Top officials with both Evergreen Health and Land of Lincoln said the formula used by the federal government to calculate risk adjustment payment is flawed and required their respective co-ops to pay insurers that didn’t need the money.

Haislmaier said state regulators are providing the co-ops with a “short-term stop gap” to help them maintain their financial footing. However, it’s unknown at this point what will happen if they decide not to make their payments through the risk adjustment program and how the federal government will respond.

“Essentially, if you’re supervising a company that’s in financial trouble, whether it’s bankruptcy court for a non-insurance company or an insurance regulator for insolvency, the first thing you want to do is don’t pay stuff you don’t have to pay, or don’t pay now what you can pay later,” he said. “From the insurance regulator’s perspective, it makes sense. What, if anything, the feds do about it and when is another question.”

The post Obamacare’s 14th Co-Op Is Closing Its Doors, and at Least 2 More Could Close Soon appeared first on The Daily Signal.