Sen. Stroebel: Obamacare a Disaster, Co-ops Kept Afloat With Smoke and Mirrors

October 18, 2016

By Sen. Duey Stroebel

As many predicted at its creation, Obamacare has caused great disruption in health care markets and was based upon a series of promises that were not going to stand the test of time. This week the Office of the Commissioner of Insurance announced that premiums for 2017 in the Obamacare federal exchanges were going to increase an average of 16 percent. We all recall how “if you like your plan you can keep it” was the lie of the year in 2013. Now we see premiums spiking around the country. Even Minnesota’s Democrat Governor Mark Dayton just admitted Obamacare is “no longer affordable.”

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A little discussed failure of Obamacare are the twenty-three health insurance cooperatives created by Obamacare to supposedly create more competition in the exchanges. These cooperatives received a total of $2.4 billion in federal loans. Today, seventeen of those cooperatives have failed.

Wisconsin is the home to Common Ground, one of six remaining cooperatives, who recently announced it will stay open. Common Ground owes the federal government $107.7 million in loans, has lost $81.6 million from the start of 2014 through June of this year, and has seen its total revenue decline over 40 percent in the past year. This feat of creative accounting or suicidal investing was only made possible by an infusion of capital from a private source that has a nondisclosure agreement to prevent the public from knowing who is backing this failed cooperative.

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Although technically a private non-profit group, Common Ground is a creation of the federal government and funded by an incredible amount of taxpayer loans. We, the public, should have a right to know who is propping up this failing entity and why. Is someone trying to buy out or take control of the cooperative? Are the public’s interests being looked after, or is someone just paying off the officers and employees of this failing entity? Is a condition of this secret capital infusion some restructuring or forgiveness of the $107 million in taxpayer funds to which the federal government has unofficially agreed?

The public is sick and tired of taxpayer dollars being used to prop up failing businesses and reward those connected to government when no one is held accountable. Imagine if we did not subsidize these organizations, how expensive would the premiums actually be? We need to advocate to repeal and replace the failure that is Obamacare.