Nine of 23 health insurance cooperatives that were created under Obamacare, or 39 percent, are now going out of business, the Associated Press reported.
Consumers’ Choice Health Insurance Co. has announced that they are folding due to changes in the Affordable Care Act. The South Carolina co-op is the ninth insurance company to go out of business and will leave 67,000 individuals and businesses looking for new health coverage.
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"They are in a financially hazardous condition," said Ray Farmer, director of the South Carolina Department of Insurance.
"I did not have faith in their financial stability to conduct business throughout the entire year of 2016," he said. "At some point in time, we would have had to take some action because of their financial condition."
While the co-op was originally funded by the federal government, there was concern that additional money promised to fund them wouldn’t come.
"Consumers’ Choice CEO Jerry Burgess said the recent announcement of reduced federal funding ‘cast doubt on the collectability of tens of millions of dollars’ leading to this ‘unavoidable outcome,’" explained Greenville Online.
"This was a difficult decision for the insurer and this agency, but this is what is in the best interests of South Carolina consumers and health care providers," said Farmer.