Obamacare’s co-ops, designed to give more choices for insurance, lost hundreds of millions of dollars in their first year and didn’t attract anywhere near as many customers as they had hoped, meaning they may go insolvent and default on taxpayer-funded loans, according to a government audit released Thursday.
One co-op already went belly-up, and all but one of the 22 others lost money in 2014, the Department of Health and Human Services inspector general said. Maine’s co-op was the only one to make money, reaping $5.86 million after it won 80 percent of the state’s Obamacare consumers.
All told, the co-ops lost $376 million and fell more than 100,000 customers short of their projections as of Dec. 31.
Auditors said they couldn’t even get year-end data for the Iowa/Nebraska co-op because state insurance regulators stepped in and liquidated it in March.
The co-ops, or Consumer Operated and Oriented Plans, were a key part of congressional Democrats’ health care plans, serving as a backup after they were unable to win passage of a “public option,” or government-run plan to be offered in each state health exchange.