Tuesday, February 21, 2012

CO-OPs- National: Feds Loan $638M for Health Co-Ops in 8 States

Health care cooperatives that are being launched in eight states announced Tuesday they will receive a total of $638 million in loans from the Obama administration under the federal health insurance law.

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Critics, led by House Republicans who voted last year to repeal the health care law, immediately questioned the administration's decision. The House Ways and Means Committee called the loans a political reward to a friendly constituency.

Republicans noted that the recipient that received the largest loan - more than $340 million - was going to a group connected to the Freelancers Union, a nonprofit that serves independent contractors that are a growing segment of the workforce. Members are eligible for health insurance through a company owned by Freelancers.

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"Freelancers Union clearly met the legal standards under the statute and federal regulations," said Brian Cook, a Centers for Medicare and Medicaid Services spokesman. "They are not an insurer, they are a nonprofit union of independent workers, sole proprietors, and entrepreneurs who do not receive insurance through an employer."

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The new federal awards were announced for co-ops serving Montana, Iowa, Nebraska, New Jersey, New Mexico, New York, Oregon and Wisconsin. "It will be consumer-governed and will be responsive to consumer needs," said John Morrison, who is helping set up the cooperative in Montana.

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