WASHINGTON (Sinclair Broadcast Group) — The Affordable Care Act has taken a nearly $1B bite out of taxpayers' wallets with the collapse of non-profit health care insurers set up under Obamacare.
Nearly half of them are predicted, or already have gone out of business before the end of the year. Those closures could mean more than 320K people will have to find new care plans in 2016.
Non-profit co-ops were created under the Affordable Care Act to promote competition and help small businesses get healthcare insurance are dead, or dying off according to experts.
John Graham with the National Center for Policy Analysis said "their business model was basically predicated on the idea that Congress would always bail them out. So, they were never fiscally responsible."
Nine of the 23 federally funded co-ops have closed or will do so before the end of the year. Too few customers and a weak cash flow doomed them in states like New York, Tennessee, Oregon and Kentucky, according to the Inspector General for Health and Human Services.
"This is not the end of Obamacare. It's the end of an end run around the fight over the public option" said Len Nichols, director for the Center for Health Policy Research and Ethics at George Mason University.
If all of the co-ops fail, it could impact about a half million people, who would have to shot for new health care coverage in 2016.
But compared to the ten million people enrolled in Obamacare, Nichols said it's a small blip.
"It's not a big part of the marketplace."
Graham sees it much differently.
"As years go by I think we will see the co-ops were a canary in the coal mine" he said.
Graham predicts for-profit well-known insurance companies will eventually pull out of the exchanges, dealing a crippling blow to Obamacare.