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Colorado HealthOP Vows to Fight For Member Interests After Division of Insurance’s Closure Decision
Greenwood Village, CO (October 16, 2015) – This morning, the Colorado Division of Insurance (DOI) announced that Colorado HealthOP will not be able to sell its plans on the Connect for Health Colorado marketplace.
Colorado HealthOP’s closure is the latest in a series of CO-OP shut downs across the country, spurred by the federal government’s failure to pay billions of dollars in promised funding. Although Colorado HealthOP stood to collect $10 million less than what was owed in federal funds, the CO-OP remained a successful private enterprise. Colorado HealthOP’s independently certified actuarial projections indicate the company would be profitable in 2016, while making significant contributions to capital reserves, and place it well on its way to paying back its federal start-up loans early.
Despite Colorado HealthOP’s projected strong financial performance, the DOI’s decision to shutter Colorado HealthOP will cause significant ramifications for Colorado taxpayers and consumers, including:
- Nearly 40 percent of Coloradans who purchased insurance through Connect for Health Colorado in 2015 are Colorado HealthOP members; these Coloradans will be forced out of the coverage they chose and likely into a choice between more expensive coverage or no health insurance at all.
- The CO-OP’s wind-down will cost taxpayers an estimated $40 million, an expense that could be avoided if the CO-OP were allowed to continue its operations.
- The premature closure of Colorado HealthOP will cause the CO-OP to default on $72 million in federal start-up and solvency funding, loans that Colorado HealthOP was poised to pay back early if allowed to continue to operate.
- Eliminating Colorado HealthOP’s low prices on the health insurance marketplace will increase healthcare costs to tax payers.
In response to the DOI announcement, Colorado HealthOP CEO Julia Hutchins released this statement:
“We are astonished and disappointed by the Colorado Division of Insurance’s decision. It is both irresponsible and premature. Colorado HealthOP is a profitable start-up insurance company that is in a strong financial position and, for two years, has served the critical needs of Coloradans by enhancing competition in the Colorado insurance market, driving down prices in the state health insurance marketplace and offering new, innovative choices to its more than 80,000 members throughout Colorado. By choosing this course of action, the Division has let local and national politics hurt Coloradans’ access to low-cost healthcare options and assessed Colorado taxpayers with significant avoidable costs. For this reason, Colorado HealthOP will continue its fight, pursuing all possible remedies, to serve Colorado.”
To ensure the CO-OP’s values are preserved and not eclipsed by financial interests, Colorado HealthOP’s Board of Directors demands that the state allow a Board-appointed independent consumer protection ombudsman to assist and shepherd its members through the shut down transition in an equitable manner. This includes the third-party review of all claim denials.
About Colorado HealthOP
Colorado HealthOP is a health insurance CO-OP founded in 2012 and has 80,000 members today. The goal is simple: to provide members with affordable, quality healthcare that delivers on their needs. While other companies focus on making profits for corporate stakeholders, we’re a nonprofit, so we can focus on helping our members and keeping costs low. We’re also a CO-OP, so we give members a real voice in the benefits and services they want. As a health insurance cooperative, the people who purchase our health insurance plans (our members) have a strong voice in the organization’s operations. Members sit on the board of directors and influence what is covered by our benefit plans. And if our revenues exceed our costs, the surplus will be reinvested to directly benefit members—through lower premiums, expanded benefits, or quality improvements.