Sustainability remains the primary focus of the seven remaining health insurance consumer operated and oriented plans (CO-OPs) as the fourth enrollment season begins this fall, reports Kaiser Health News.
The number of CO-OPs has dwindled greatly from the 23 that were operating in 2014, which at the time covered about 1 million Americans. Plans in Oregon, Ohio, Connecticut and Illinois will cease operations by fall due to financial insolvency. The seven remaining CO-OPs for 2017 will have about 350,000 members, according to the article. They all posted losses in 2015.
One source of financial trouble for the CO-OPs has been the federal risk adjustment program, to which many owe significant sums for the 2015 benefit year. Maryland’s CO-OP, Evergreen Health, is challenging the federal government’s order that it pay $22 million to other state insurers whose members had higher health risks in 2015, saying that represents 26 percent of its 2015 premium revenue.
Most of the remaining CO-OPs will raise premiums by at least 10 percent for 2017, but are looking to other solutions as well.
Maine’s CO-OP, Maine Community Health Options, expects to save $14 million annually through lower drug prices from a newly contracted pharmacy benefit manager, Express Scripts, according to the report. In addition, New Mexico Health Connections seeks to raise money from investors, which CO-OPs only recently have been allowed to do, and is adding larger client groups such as teacher unions.
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