First, they lost their health insurance.
Now, they face a possible federal fine.
A Nebraska Congressman hopes to help them.
CoOportunity Health covered 120,000 Nebraska and Iowa residents. It is one of 17 federal co-ops now insolvent, their clients scrambling for coverage.
Congressman Adrian Smith tells of a western Nebraska resident who lost her insurance coverage.
“She ended up going into CoOportunity Health. The plan within CoOportunity Health ceased to exist so they moved her over into another plan in CoOportunity Health and then the whole thing collapsed,” according to Smith. “So, she’s lost coverage three times through no fault of her own.”
Smith sponsors a bill that would shield those who lost coverage due to the insolvency of the federal co-ops from federal fines for a year. Smith says consumers deserve time and flexibility. He says the bill provides targeted relief. It applies only to former clients of the federal co-ops and holds off any potential federal fines for not having health insurance for a full calendar year.
H.R. 954 is retroactive. It applies to individuals who lost coverage after December 31st of 2013, which would include former clients of CoOportunity Health.
The House Ways and Means Committee has passed the bill and sent it to the full House for debate.
Some have criticized Congress for the fall of the co-ops, arguing they starved them of needed funds. Smith acknowledges too many assumed more federal funding would keep them afloat.
“But they should not have planned for those funds from the beginning, because there was never that guarantee,” Smith says.
The federal co-ops received $2.1 billion, mostly in the form of startup and solvency loans. So far, 17 of the 23 co-ops have folded.
Smith blames a faulty formula for the collapse. He says the co-ops were created by those wanting to offer a public option to traditional insurance, but Smith contends the co-ops were never subject to the actuarial financial standards of the insurance industry.
AUDIO: Brent Martin reports [1 min.]