Opening Statement of Ranking Member Jim McDermott at Health Subcommittee Hearing on CO-OP Program under the ACA

Nov 3, 2015
Press Release

For the past five years, my Republican colleagues have systematically and deliberately sabotaged the implementation of the Affordable Care Act.

Through phony hearings, frivolous lawsuits, meaningless repeal votes, draconian funding cuts, and a nationwide smear campaign they have done everything in their power to undermine this landmark law.

The early challenges facing the CO-OPs are just the most recent consequence of this destructive Republican agenda.

The CO-OPs play an important role in providing competition in the Marketplaces.

They are community-based, non-profit health plans that first and foremost exist to serve consumers.

If Congress gives them the support they need to get off the ground, they will provide the American people with more choices and help keep the for-profit insurers honest.

But my Republican colleagues have shown that they have no interest in making this happen.

Instead, they have weakened and undermined the CO-OPs at every turn.

And now they point the finger at the Administration when they struggle.

In 2013, the Republican Congress slashed funding for loans and grants to CO-OPs by nearly two-thirds.

These cuts have devastated CO-OPs across the country and prevented CMS from approving dozens of new applications.

Moreover, my Republican colleagues have sabotaged the risk mitigation programs designed to provide financial stability to insurers, including the CO-OPs.

In the Cromnibus legislation passed at the end of last year, the Republicans inserted a rider that blocked discretionary moneys from being shifted into the ACA risk corridor program.

As a result, the program has been badly underfunded, and insurers across the country will receive only one-eighth of what they expected.

Many of the fledgling CO-OPs simply do not have the capital to absorb this unpredictability, which contributes to the failures we have been seeing.

This is not a problem with the CO-OPs.

It is a direct consequence of Republican sabotage.

While my colleagues continue to brazenly attack the Affordable Care Act, they refuse to put forward any constructive ideas.

This is particularly ironic when it comes to risk mitigation because – based on their past behavior – they should know better.

When Congress enacted Medicare Part D, we created several risk mitigation programs that are very similar to the ones in the Affordable Care Act.

My Republican colleagues have strongly supported these measures for more than a decade – even longer than many experts believe was necessary to get Part D up and running.

The result has been a stable program and a strong market for Part D plans.

In other words, Republicans enthusiastically support risk mitigation – but not when it’s a part of the Affordable Care Act.

Rather than playing Monday morning quarterback and blaming everyone but the people who control the purse strings, we should be talking about things we can do to actually strengthen competition.

That conversation should examine how we can make the CO-OP program stronger.

And there are some changes that we need to consider.

Despite being brand new companies with no existing customer base, the CO-OPs are prohibited from using federal start-up money on marketing.

This makes it nearly impossible for them to compete against some of the most powerful corporations in the world.

We need to fix this and let the CO-OPs operate on a level playing field with the for-profit insurance industry.

And an honest conversation about competition must also include a discussion of creating a public option to compete with private insurers on the Exchanges.

This would place a meaningful check on the insurance industry, give consumers more choices, and reduce the deficit by more than $100 billion.

But don’t expect to hear anything like that from my Republican colleagues this afternoon.

Instead, we will hear more of the same – complaints about problems they have created through their own sabotage and nothing constructive about how to make the system better.

I yield back the balance of my time.