(AP) — The health insurance co-ops created by the Affordable Care Act absorbed deep financial losses last year. And 2016 is shaping up to be a make-or-break year for the nonprofit alternatives to traditional insurers.
They were devised to put competition into insurance markets. But they have struggled from the start to build a customer base from scratch and deal with higher-than-expected expenses.
Heading into their third full year of operation, the co-ops are adding customers and improving their coverage. But they also face the end of some government programs designed to support insurers as they build business on the public insurance exchanges.
Soon, they will have to determine whether their businesses can stand on their own and compete with more established carriers.
The CEO of the federal exchange operator HealthCare.gov told senators yesterday that the co-ops this year “must move from startup to stability and improve their financial capabilities.”
There are some positive signs. The co-ops hit a growth spurt and now cover more than 350,000 people, or nearly triple their total from 2014. Enrollment is growing better than expected and patient populations appear to be getting younger and healthier in some cases.
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