Top CMS Official Tries to Defend Co-Ops as Conservatives Label Program a ‘Failure’

A top Centers for Medicare and Medicaid Services official defended the health insurance co-ops created under the Affordable Care Act Wednesday, after four more of the nonprofit insurers announced they would take steps to wind down in recent weeks.

Kevin Counihan, the CEO of HealthCare.Gov, told a subcommittee of the House Committee on Oversight and Government Reforms that the co-ops have spurred innovation within the health insurance marketplace and given consumers more opportunities. But Republicans on the panel railed against the program, as about two-thirds of the co-ops have now announced steps to close down.

“This is a tough industry, as you very well know. It’s very tough to be a small business, and it’s tough to be a small health insurance company,” he said. “We’re doing everything that we can to collaborate with the state departments of insurance and with the co-ops to make them successful.”

But Counihan comments contrasted against a panel mostly intent on pointing out the facts of how many co-ops have closed. Subcommittee chairman Rep. Jim Jordan (R-Ohio) said he expects those to shut down in the near future, and several Republican members continued to point out that just yesterday another co-op in Illinois announced it would close its doors.

Whether or not a co-op is profitable can depend on month-to-month data, Counihan told the panel. He would not say whether the co-op system had been a “total failure,” but said some have inspired new models that other industry players have picked up.

“Another perspective on that is that because of these co-ops we’ve been able to give people more choice,” he said. “Because of these co-ops we’ve been abel to innovate. Many of these new co-ops have come up with new care management model that are being replaced by some of their larger competitors.”

One unexpected exchange occurred between Rep. Michelle Luan Grisham, a Democrat of New Mexico, who told Counihan she did not think the administration had been entirely “thoughtful.” Customers in her district will have just one insurer on the exchange this year, she said. She asked Counihan to hear more about what strategies the administration has thought of to help states like New Mexico with remaining co-ops in difficult situations.

“I see nothing that’s been targeted or strategic for those states, and I’ve seen very little quite frankly from the administration about dealing with these issues except telling me that the marketplace is incredibly competitive and people have great choices, and it’s all going to work itself out,” she said.

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