Maryland’s health cooperative filed a lawsuit Monday seeking to block the federal government from requiring it to pay more than $22 million in fees for a program designed to cover insurance company shortfalls.
The lawsuit by Evergreen Health Cooperative Inc. is the latest twist in the saga of health insurance co-ops set up under the Affordable Care Act to compete against larger, established insurers.
The co-ops were supposed to help keep premiums down by injecting competition into the industry. Instead, 13 of 23 startups that launched successfully have since collapsed, forcing more than 700,000 consumers to seek new insurance. A number of co-op officials have said they were hurt by the federal program because of a formula it used to spread out risk, which they say hurts them while benefiting large, already established insurance companies.
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