A few weeks ago, the administration issued new regulations in a last-ditch attempt to save the few remaining CO-OP organizations.
The first change would limit the restriction on people with health insurance experience to those who have been “an officer, director, or trustee,” and it limits “pre-existing insurer” to those to who were active in the individual or small-group markets prior to July 16, 2009. This would open up the field of potential CO-OP board members to people who had (a) worked for health insurers active only in the large-group market, or (b) worked for any insurer, but in a lower-level capacity.
The second change would allow a CO-OP to sell itself to – or become by selling shares – a for-profit insurance company, (or a non-member-owned non-profit insurance company), if that’s necessary to prevent insolvency. The membership ownership and benefit-the-patients requirements would be removed. It would still, in theory, be required to pay back the start-up loans to the federal government. This utterly misses the point of the program as described in Section 1322(a)(2), effectively ending the CO-OP program entirely, again without Congressional approval.
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