October 19, 2015 02:21 PM UTC

Gardner's Co-op Hypocrisy Practically Unbelievable

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• by: Colorado Pols

There’s a huge hole in stories written in the wake of Friday’s announcement that the state’s largest nonprofit insurance provider Colorado HealthOP would be dropped from the insurance marketplace due to concerns about the organization’s financial stability. Revisiting a story cited in a reader’s diary Saturday from the Denver Post’s Alicia Wallace:

The Colorado Division of Insurance dropped HealthOP from the state insurance exchange because it no longer meets state capital-reserve requirements.

Without the ability to sell 2016 plans, the low-cost insurer is effectively out of business…

Colorado HealthOP’s financial health was rocked this month when the federal government said it would not make the full “risk-corridors” reimbursements promised by an Affordable Care Act program to help insurers take on the sickest, most expensive members.

It’s very unfortunate that stories like this one don’t explain the full facts of what happened, to the extent of becoming outright lies of omission. As Davie explained this weekend, the high-risk subsidies that could have helped the startup health insurance cooperatives set up under Obamacare survive until becoming self-sufficient were undermined during budget negotiations between the White House and the Republican-controlled Congress. Several years ago, as the nation was facing a so-called “fiscal cliff” as a result of GOP refusal to pass a budget, the funding for these organizations was greatly reduced as part of the deal to keep the government functioning.

Meanwhile the co-ops signed up large numbers of relatively ill new patients, incurring big losses that temporary “risk corridor” payments were meant to offset. Last month, however, the federal government announced that it had only a small percentage of the money it had promised co-ops under the temporary “risk corridor” subsidy program–leading directly to financial crisis at several state insurance co-ops including Colorado’s:

Liberals, dismayed that a public option wasn’t included in the healthcare law, viewed co-ops as alternatives to provide competition over large, established health insurers. But co-op funding was slashed multiple times before the not-for-profit companies ever got off the ground, and plans to create a co-op in every state were swiftly dashed.

Conservatives have criticized co-ops as a waste of taxpayer money, since co-ops were awarded federal loans to get started. However, strict conditions were placed on the loans, including a quick payback period and prohibition from using the money on advertising.

Regardless of the daunting challenges faced by co-ops through no fault of their own, Sen. Cory Gardner’s statement Friday on Colorado HealthOP’s setback predictably laid the entire debacle at the feet of the Obama administration:

“This failure can be added to the very long list of Obamacare’s broken promises. Taxpayers are on the hook for millions of dollars in loans given out to the CO-OP, money that will likely never be repaid. The years since Obamacare’s passage have been marked by crisis after crisis in healthcare, and it’s far past time for a new plan.”

The problem is, Gardner knows exactly why this happened–the funding for the co-ops was slashed as part of the fiscal wrangling between the White House and the GOP-led Congress. Gardner was there. It’s fair to question why the Obama administration was willing to make such a bargain, which in the 2013 Washington Post story cited above was identified as a central reason the co-ops were in long-term, fiscal danger–that and the numerous concessions to the health insurance industry that onerously restricted how the co-ops could conduct business. But you can’t claim Gardner didn’t support hobbling the co-ops from the outset, because he did.

And it gets better. As the Greeley Tribune reported in November of 2013, Gardner took a direct, unapologetic shot:

U.S. Rep. Cory Gardner, R-Colo. joined as an original co-sponsor Wednesday of H.R. 3541, the House companion bill to Sen. Marco Rubio’s S. 1726, the Obamacare Taxpayer Bailout Prevention Act…

Like S. 1726, H.R. 3541 would repeal Obamacare’s risk corridor provision. [Pols emphasis]

Bottom line: Cory Gardner is not just an observer in this destruction of the Affordable Care Act’s nonprofit co-op system, which was itself a compromise put together after a more robust (and arguably much more functional) “public option” insurance entity was discarded. From Gardner’s support for throttling the co-ops during high-stakes budget negotiations to trying to kill the “risk corridor” reimbursement program off completely, Gardner worked to bring to pass the very “crisis” he claims to be upset about.

And now, Gardner is pointing fingers over the consequences of his own actions. If you think about that for a moment, that’s really an incredible situation.

As in incredibly deceptive.