Reporter- Baltimore Business Journal
Updated: Jun 19, 2013, 1:57pm EDT
A federal program that helped launch former Howard County health chief Dr. Peter Beilenson’s private health insurance organization is coming under fire in a Congressional committee.
The House Oversight Committee, chaired by Rep. Darrell Issa, R-California, is investigating a federal program that set aside $6 billion to award as loans to private organizations for setting up consumer-run insurance companies. The loan program was created as part of the Affordable Care Act.
The committee on June 14 subpoenaed Health and Human Services Secretary Kathleen Sebelius for documents about the program. The committee also requested information from 13 of the 24 co-ops that received a loan through the program, including Baltimore-based Evergreen Health Co-op Inc.
Evergreen Health received a $65 million loan in September. An Evergreen spokesman said the organization is providing the information requested by the committee.
“We’ve certainly done nothing wrong,” said Evergreen spokesman Matt Jablow.
The committee requested information from co-ops that either did not have an established infrastructure, lacked leadership with experience in health care, or had past financial or legal trouble, said Caitlin Carroll, a spokeswoman for the committee. Carroll could not say which of those reasons applied to Evergreen.
The committee has also requested information from co-ops in New York, New Jersey, Oregon, Louisiana, Kentucky, Maine, Vermont, Connecticut, Montana, Nevada, Iowa and Illinois.
Jablow said the committee’s investigation has not affected Evergreen’s daily operations and preparations for an October open enrollment launch.
“We’re very excited about our launch,” he said. “We don’t think this will have any effect on it.”
In a letter dated March 25, the committee asked Evergreen to provide a copy of its application for the loan program, its 990 tax forms from 2010 and 2011, a list of all the loans, grants and contracts ever received from the federal government, and an itemized breakdown of how Evergreen has spent and plans to spend its $65 million loan. The committee also requested all communication about the loan application between Evergreen and the federal health department and other federal agencies.
The private co-op program was designed to help establish private insurance exchanges that would compete with public exchanges, potentially lowering prices. Loans were intended to be awarded to one group per state but only 24 co-ops received funding before the program’s budget was cut. The program’s $6 billion budget was first reduced to $3.8 billion and ultimately eliminated in federal budget deals late last year.
The House committee began looking into the co-op program last year under suspicion that the application and award process was flawed and concern that the program was a risky investment that could lose millions in taxpayer money.
The committee on June 14 subpoenaed Health Secretary Sebelius for documents on the program, after her office did not provide the documents requested in two previous letters sent in October and March.
http://www.bizjournals.com/baltimore/news/2013/06/19/evergreen-health-co-op-responds-to.html?ana=lnk&goback=%2Egde_3921873_member_251423933
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