Nonprofit co-ops – Obamacare's alternative to big insurers – are bleeding red ink, with many falling far short of their sign-up goals, according to a government watchdog audit.
Under the healthcare reform law, taxpayers provided $2.4 billion in loans to get the co-ops going, but only one out of 23 – in Maine – made money last year, the report finds.
by the Health and Human Services inspector general's office also found 13 of the 23 were far behind 2014 enrollment projections.
"The low enrollments and net losses might limit the ability of some co-ops to repay startup and solvency loans, and to remain viable and sustainable," according to the audit.
Kentucky’s co-op, which is faring the worst, lost about $50 million; on enrollment, Arizona’s co-op signed up just 869 people, compared to a goal of about 24,000.
Nine plans, however, are besting enrollment projections – with New York’s roughly 150,000 enrollees at five times its projection, the audit finds.
But according to the audit, Iowa and Nebraska’s co-op was shut down in February because of financial problems, and Louisiana’s co-op announced this week it wouldn't offer coverage next year.
"As with any new set of business ventures, it is expected that some CO-OPs will be more successful than others, but CMS will continue to actively monitor each CO-OP's progress, and remains committed to facilitating access to affordable, high-quality health insurance for all Americans," the Centers for Medicare & Medicaid Services told the inspector general, The Hill reports.
HHS spokeswoman Meaghan Smith said in a statement the department is monitoring co-ops, working with the inspector general, and is working on reworking criteria on when a co-op is no longer financially viable, The Hill reports.
The Associated Press contributed to this report.
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