IREG Update - Key Changes For ACA CO-OP Boards: A Look At New Regulations Taking Effect This Week

On May 6, 2016, the US Department of Health and Human Services (HHS) released an interim final rule with comment (IFC) to bolster the viability of the remaining Consumer Operated and Oriented Plans (CO-OPs). Notably, the IFC takes effect almost immediately, on May 11, 2016. The following provides an overview of the IFC's key changes to existing CO-OP regulations.

Background

Section 1322 of the Patient Protection and Affordable Care Act (ACA) created a loan program to fund the establishment of CO-OPs—not-for-profit, consumer-driven health insurance issuers intended to compete with established commercial insurers. The ACA initially appropriated $3.8 billion for the CO-OP loan program, however much of this funding was later rescinded by Congress, contributing  to the demise of a number of CO-OPs with serious solvency concerns. While 23 CO-OPs initially received funding under the ACA, only 11 remained operational by the end of 2015.