Smith Presses HHS on Financial Status of Obamacare Co-Ops

Congressman Adrian Smith (R-NE) submitted the following questions to Secretary of Health and Human Services Sylvia Burwell today following Secretary Burwell’s testimony before the House Ways and Means Committee earlier this month.

As you know, I continue to be concerned about the solvency of the remaining Consumer Oriented and Operated Plans (co-ops), and whether the taxpayer dollars loaned to the co-ops will ever be repaid.

In a January 6, 2016, letter, CMS Acting Administrator Andrew M. Slavitt stated, “CMS will use every available tool to recoup loan funding” from co-ops which are wound down. Please provide an update on recovery of funds from co-ops which have been or are being wound down.

Has HHS or CMS estimated how much money will be recovered from the failed co-ops? If so, what is that estimate and how was it calculated?

What is the financial status of the remaining co-ops? Do you expect additional co-ops to suspend operations in 2016? If so, how many?

Do you project the remaining co-ops will repay their loans on time, under the terms of their contracts with CMS? What is the basis for that determination?

Following the submission of these questions, Congressman Smith said:

“HHS and CMS continue to tell Congress they will do everything they can to recover the more than $1 billion lost so far through failed Obamacare co-ops, but there has been no information provided on where this process stands and whether remaining co-ops face the threat of insolvency. In a Wall Street Journal report this week on efforts to recoup loans made to the failed co-ops, the National Alliance of State Health Co-ops chairman said, ‘In terms of collections, no. There’s nothing to collect.’ Taxpayers deserve real answers on whether these funds will ever be recovered, and I will continue pushing the Obama administration to provide specific information instead of vague assurances.”

Smith serves on the Ways and Means Health Subcommittee.