House Energy and Commerce Committee Leaders Seek Documents, Next Steps For Co-Ops

Republican leaders of the House Energy and Commerce Committee asked what the Centers for Medicare and Medicaid Services will do to support the existing 11 co-ops created under the Affordable Care Act in a letter dated Nov. 24 to Andrew Slavitt, acting CMS administrator.

“The committee is concerned that CMS does not have a plan to ensure that the remaining CO-OPs are financially solvent,” the letter reads. “The existing 22 CO-OPs represent over $1 billion in federal loans that should be paid back to the federal treasury over the next decade. Additionally, the Committee believes that CMS should take actions to recoup federal dollars from failed CO-OPs whenever possible, in order to mitigate the loss to taxpayers.”

The committee held a hearing earlier this month to investigate the failed co-ops. The lawmakers wrote that the CMS representative at the hearing did not give specifics about how the agency would address problems including the “risk corridor” program and CMS’s risk adjustment formula, which co-op administrators said partially led to the failures. They also were concerned by the closure of Health Republic of New York after it received additional government funding despite reporting financial difficulties.

Fred Upton (R-Mich.), who chairs the committee, Tim Murphy (R-Penn.), chairman of the Subcommittee on Oversight and Investigations, and Joseph Pitts (R-Penn.), chairman of the Subcommittee on Health, sent the letter.

The three also asked for more information and documents in several areas, including how the agency decided to give federal loans to certain co-ops, corrective action plans for some co-ops, and the closure of Health Republic of New York.

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