The Obamacare Co Ops are collapsing right and left and the Federal government admits that it will never recoup all or part of the $1.2 billion it lent to them to get them going. The Obama administration has admitted today that the co ops are a total and complete failure by stating that they were open to privatizing the co ops.
The basic sales pitch here is that they are going to fundamentally transform the dozen co ops that are still standing and try to attract private investors.
The Obama administration’s top health insurance official told Congress Thursday he wants to “loosen up capital rules” to allow private investors to become part owners of the dozen surviving Obamacare co-ops.
Andy Slavitt, the acting administrator for the Centers for Medicare and Medicaid Services (CMS) which oversees the Obamacare co-ops, told the Senate Finance Committee that his agency would also look approvingly on co-op mergers with existing insurance companies.
The new private investment policy represents a major reversal for the Obama administration, which has previously hailed the non-profit co-op health insurance model as a tool for providing competition to private, for-profit insurers.
A co op that is run by private investors is not a co op, it’s an insurance company. This is an admission that the co ops are a total failure and were not able to compete with private insurers even in the warped marketplace created by Obamacare.
I am not really sure why a private insurance company would want to buy one of these co ops that is currently hemorrhaging money like it was a Trump casino in Atlantic City, but I wish the government all the best of luck with that.
Of course, the failure of these co ops is more than just an indication of the failure of the Obamacare business model – it is a complete rejection of the leftist worldview, and particularly the worldview of socialists like Bernie Sanders. The entire theory of these co ops is that by propping them up with massive government loans and making them non-profit entities, they would provide health insurance so cheaply that the private sector insurers would have to compete aggressively with them.
But even with the massive thumbs the government had on the scales in favor of the co ops, they were still completely unable to compete in the free market against private entities. this is conclusive proof, for any who want to see it, that the government is categorically worse at providing virtually every service that you can think of than the private sector is.