COMMITTEE APPROVED: Bill to Protect Victims of Obamacare's CO-OP Closures

Press Release

Today, the Ways and Means Committee approved the CO-OP Consumer Protection Act of 2016 (H.R. 954), legislation to help Americans who have been harmed by Obamacare's closing CO-OPs. Sponsored by Rep. Adrian Smith (R-NE), the bill exempts from the law's individual mandate tax penalty those who unexpectedly lost their health insurance--through no fault of their own, but because of a particular Obamacare failure.

As Rep. Smith explained:

"This is a short, simple bill with a basic premise -- if you are a consumer who complied with the ACA's individual mandate by purchasing health insurance through one of the Consumer Oriented and Operated Plans, or CO-OPs, created under the law, and your plan was terminated mid-year by the failure of that CO-OP, you shouldn't be liable for the individual mandate for the remainder of that calendar year.

"We have already had a hearing on what happened with the CO-OPs, so I won't spend a lot of time rehashing that history. In short, $2.1 billion, largely in the form of startup and solvency loans, was distributed to approved CO-OPs. Now, 16 of the 23 CO-OPs which received $1.7 billion of those dollars have closed or are in the process of closing, with the remaining seven also struggling to remain solvent."

Highlighting how the collapsing CO-OPs have directly hurt Ohioans, Health Subcommittee Chairman Pat Tiberi (R-OH) said:

"This is not hypothetical. This is happening right now … Thirty-one percent of American counties have one provider of health insurance, they don't have choices. They don't have choices in my state. InHealth, the CO-OP in my state, 22,000 people lost their health coverage…

"In Ohio, if you had InHealth, in some of my counties not only did you wake up one day and have no health insurance -- zero, none -- you lost your doctor. Now you go look at the plans, there's one. One plan … you lose your health care, you lose your doctor, and now you're going to get penalized."

Rep. Smith added:

"It is only fair that we reduce the impact further for these families, and ensure that if any other CO-OPs close that families struggling to make an unexpected decision about health insurance midyear don't have individual mandate penalties to worry about as well."

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