Affordable Care Act (ACA) — “Obamacare” — Co-Ops will likely never repay taxpayer money lent to them, according to an audit from the Inspector General’s office at the Department for Health and Human Services (HHS).
The investigators found that the Center for Medicare and Medicaid Services (CMS) did not account for how the federal government would recover the loans if the Co-Ops failed.
Obamacare authorized the CMS to loan money to support Consumer Operated and Oriented Plans, or Co-Ops. The Co-Ops were to be treated like startups, and repay the loans once they received business through Obamacare’s glitchy online marketplaces.
At issue is a controversial rule which let struggling Co-Ops convert their loans into “surplus notes,” meaning they did not need not make payments on the loan if they were strapped for cash.