This past Wednesday news was buzzing with yet another co-op closing its doors. Nevada Health co-op will be the third cooperative health insurance company that was created by the Affordable Care Act (ACA) to close their doors. The reports are that they can’t keep up with challenging market conditions and cost.
When you go to Healthcare.gov and look into plans offered in Las Vegas, one of the largest cities in Nevada there are only three carriers that come up. You’re putting a brand new company up against Blue Cross Blue Shield and Health Plan of Nevada who is operated by United Healthcare. This is a brand new company trying to edge itself into the market up against the number one and two healthcare providers by revenue. Those are David and Goliath odds and unfortunately David didn’t win this one.
Nevada Health co-ops medical-loss ratio was 103.5%. Logic says that most of these co-ops aren’t going to survive as they go up against companies who gained their financial stability in a medically underwritten health market. Companies that have been in the individual health care market for years started with a healthier membership pool due to medical underwriting prior to ACA being implemented. A new co-op trying to start in this market is a difficult proposition with the current competition.
I am an advocate for the underdog and I hope co-ops are able to stay competitive in their premiums and coverage to keep their doors open. These are great health insurance companies and have been doing a great job for their insured, so let’s do something to keep their doors open! 2016 will bring on some interesting prospective as I keep my eye on the remaining co-ops. You can see all of the co-ops listed on the National Alliance of State Co-Ops (NASHCO) website HERE.
Does your state have a health co-op? If yes will you consider enrolling in one of their plans during Open Enrollment for 2016?