Two largest Obamacare co-ops fold, 400,000 left without insurance

by Caitlin Bronson 

More than 400,000 Americans are now without health coverage as the insurance cooperatives created under the Affordable Care Act continue to fail.

Two more co-ops closed their doors this weekend – the Kentucky Health Cooperative, which served 51,000 members, and Health Republic Insurance of New York, with 215,000. The announcements follow those of CoOportunity Health in Iowa and Nebraska, the Louisiana Health Cooperative and Nevada Health Co-Op.

Health Republic Insurance of New York was the largest of the ACA nonprofit cooperatives, and was shut down by regulators after losing roughly $52.7 million in the first six months of the year. That is on top of a $77.5 million loss in 2014, according to regulatory filings.

Deep Banerjee, an analyst with Standard & Poor’s Ratings Service, blamed the shut down on insufficient premiums that did not cover members’ health expenses and its own costs of operations.

“They are paying out in claims and expenses a lot more than they are getting in the door,” he told the Wall Street Journal.

Kentucky Health Cooperative, meanwhile, was the second-largest co-op in the country and insured 75% of Kentucky residents who enrolled in coverage. The organization had been awarded $146.5 million in taxpayer loans for its launch, including $65 million in solvency funding as recently as November of last year.