WASHINGTON – Sen. Chuck Grassley of Iowa today pressed the top U.S. health care official on whether her agency will be able to offer any help to the Iowans and Nebraskans who were hit financially by the recent failure of CoOportunity, the co-op created through the federal health care law.

"I’ve heard from an Iowa couple who are out thousands of dollars because the co-op failed when it did,” Grassley said.  “If they’d known the co-op was in trouble, they might have been able to save themselves the money.  I’m starting to hear from other families in the same situation.  The federal government needs to explain why it apparently communicated so badly with Iowans and Nebraskans and let them re-enroll in CoOportunity.”

At a Finance Committee hearing, Grassley pressed Department of Health and Human Services Secretary Sylvia Burwell on the situation encountered by a family in Milford, Iowa, who wrote to Grassley.  Burwell responded that her agency is working with the state of Iowa, which has taken over the failed co-op, to help consumers.  She also said the agency will respond to Grassley’s earlier letter asking about the department’s role in CoOportunity’s collapse.
 
Grassley said he will continue to press for answers on behalf of the Iowans and Nebraskans left in the lurch for their health insurance, including those who have already paid significant money out of pocket for this year, like the Bush family of Milford, and will have to start over again with a new insurer.

The text of Grassley’s question this morning follows here:

Sen. Grassley Question for Secretary Burwell

I’m concerned with the recent failure of CoOportunity, the co-op created through the Affordable Care Act that operated in Iowa and Nebraska.  CoOportunity was one of the 23 co-ops formed and funded with loan money awarded by CMS.  As I understand it, CMS played a significant role in overseeing the co-ops including having ultimate authority over setting their rates.
 
CoOportunity was very successful in attracting beneficiaries with the second most covered lives of all the co-ops.  It was even more successful than anticipated.   In the summer, it became obvious to CoOportunity and the Iowa Insurance Commissioner that CoOportunity would need additional loans from CMS to stay in business.
 
Both the Iowa Insurance Commissioner and CoOportunity frequently inquired with CMS about their capital position and the need for certainty ahead of open enrollment as it was clear that a liquidity crisis was developing.  CMS knew CoOportunity was going to be in trouble if it didn’t get loans.  CoOportunity was allowed to be on the Iowa and Nebraska Marketplace when it opened on November 15.  CMS finally let CoOportunity know that no further loans would be coming right before Christmas, and the Iowa Insurance Commissioner was forced to take over CoOportunity on December 24.  
 
I am concerned about CMS’ role as a regulator of CoOportunity and all the co-ops.  There are two billion taxpayer dollars that depend on the success of the co-ops, and CMS did not distinguish itself in its actions with CoOportunity. 
 
I’ll have more questions for you for the record regarding CMS’s actions, but my question for you today is on behalf of Shane and Bette Bush of Milford, Iowa.  They paid their premiums and renewed their coverage with CoOportunity as they expected it to be there for them in 2015. 

Unfortunately, Shane Bush had emergency surgery on January 3.   Fortunately, Mr. Bush is recovering, but the care was not inexpensive.  The Bushes have already hit their out of pocket maximums for CoOportunity.  With CoOportunity being liquidated, the Bushes will have to find new coverage and that next insurer will not have to recognize the money already spent by the Bushes in 2015.  With additional expenses certain this year, the Bushes will be out the thousands of dollars they have already spent in 2015.
 
The Bushes can’t afford to pay out of pocket maximums for two different plans.  They are in this situation, as I see it, because CMS ignored the warnings from Iowa and CoOportunity, allowing CoOportunity to go back on the Marketplace, and now folks in Iowa and Nebraska like the Bushes face financial consequences because of CMS’ foot dragging.  I intend to ask you further about what CMS was doing and why, but what I want to ask you today is what responsibility you think your department and CMS have to people like the Bushes.  Given what I am seeing from CMS with the co-ops, I am afraid they won’t be the last.

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