Obamacare Destroys Insurance Company; Feeds It to Another

There is now one less insurance company in Iowa under Obamacare.

obamacare death star

Remember how the Affordable Care Act was supposed to give us more choices and more competition?

“Here in Iowa, we were promised more [choices] and lower premiums, yet now we learn that one of two [companies] responsible for providing affordable insurance can’t provide what the law promises.” –David Klein, director of the Iowa chapter of the Americans for Prosperity

Yes, it was an obvious lie. But it is still worth documenting how much reality is different than the fantasy promises of Obamacare.

[See also, “Liberals Complain that ‘Obamacare’ Takes Away their Choices.”]

Fox News reports, “ObamaCare woes: Struggling Iowa health insurer taken over by state.”

A taxpayer-backed Iowa health insurer created under ObamaCare has been taken over by the state amid deep financial problems, sending policyholders in the Midwest scrambling for new coverage and raising questions about the status of similar outfits across the country. 

The Iowa Insurance Division announced Wednesday that Insurance Commissioner Nick Gerhart was taking over CoOpportunity Health, a struggling cooperative that sprouted out of the Affordable Care Act. 

A local court had granted Gerhart’s request to be appointed as “rehabilitator” of the nonprofit, after the state warned of its “hazardous financial condition.” Gerhart now has the authority to manage the company – and either restructure it or have its assets liquidated. 

Gerhart told customers that those who enrolled before Dec. 15 and make their premium payments can keep their insurance. 

But anyone who signed up Dec. 16 or later will not have coverage and now must enroll in other plans to stay insured. Further, if CoOpportunity Health goes under, a government safety net could protect those left holding their policies. However, the coverage “may be limited,” the state warned. And Gerhart is advising that most of the 120,000 CoOpportunity Health policyholders in Iowa and Nebraska “may find it in their best interests” to find new carriers by Feb. 15 – the deadline for open enrollment for 2015 coverage. 

CoOpportunity Health will no longer offer its policies through Iowa’s online marketplace, either. 

Waiting in the wings is Coventry, the “last man standing” among Iowa Insurance companies that offer plans which qualify for Federal subsidies. Naturally, they act as if they are in the business out of the kindness of their hearts.

Coventry’s parent company, Aetna, said it would work with state and federal regulators “to do all we can to aid in a solution.” 

“That solution must be in the best interests of the people in both states and incorporate adequate pricing to ensure sustainability of coverage,” Aetna said in a statement.

I don’t know if Coventry could benefit from CoOpportunity’s implosion, or if they are being pressured to swallow a bad deal. Either way, the government has corrupted the entire market by inserting itself between customers and service providers who should be free to negotiate without imposed rules and regulations.