Your Health Plan Will Now Self-Destruct

When state health insurance marketplaces were created under the Affordable Care Act (ACA), the Obama administration was worried there wouldn’t be enough competition to keep premiums low. So it loaned $2.4 billion to establish 23 nonprofit health insurers known as consumer operated and oriented plans, or co-ops. Although the co-ops struggled in their first two years, most were still expected to offer plans for 2016 when the marketplaces open for enrollment on Nov. 1.

Turns out, many won’t. Ten co-ops have folded this year after state regulators stopped them from offering plans, because of weak balance sheets. Seven have closed just since the end of September, the most recent on Oct. 27. That’s left more than 500,000 people to find new coverage, some in rural areas that now have only a single ACA provider. Co-ops in New York, Oregon, Colorado, and elsewhere are also at risk of defaulting on their federal loans.