Ongoing problems with the Affordable Care Act risk-adjustment programhave pushed two of the last remaining Consumer Oriented and Operated Program carriersinto receivership.

The Maryland Insurance Administration has put Evergreen HealthInc. into receivership and, apparently, given up on the idea thatinvestors might buy its assets. That CO-OP carrier has about 25,000enrollees.

The Massachusetts Division of Insurance has put MinutemanHealth, a CO-OP that does business in Massachusetts and NewHampshire, into receivership, but left open the possibility thatTom Policelli, the company's chief executive officer, might find away to re-organize the company outside the restrictions of theCO-OP system.

Minuteman Health has about 37,000 enrollees.

Regulators have not published any details about the EvergreenHealth or Minuteman Health receiverships on the web. Regulators sayboth plans will continue to pay medical claims.

Consumer Oriented and Operated Programs (CO-OPs)

The drafters of the Affordable Care Act created the CO-OPprogram in an effort to increase the level of competition in theprivate health insurance market, by providing startup loans fornonprofit, member-owned carriers.

The moderate Senate Democrats who championed the program leftthe Senate soon after the ACA came to life.

Senate Republicans cut funding for the CO-OP program, and theyfaced little opposition when they did so from the administration offormer President Barack Obama.

Obama's health insurance regulators used the ACA as the basisfor setting tight restrictions on CO-OP funding and operations. ACO-OP, for example, could not be owned, or partly owned, by anyexisting health insurer, and its member owners could never sell theCO-OP. The sale restriction made using a CO-OP's assets as loancollateral impossible.

About three-quarters of the 23 CO-OPs that came to life in 2014and 2015 are now dead, or under some kind of state supervision.

ACA risk-adjustment program

ACA drafters and regulators also created a risk-adjustmentprogram, to help shift cash from issuers of individual andsmall-group coverage that ended up with low-risk enrollees toissuers that ended up with high-risk enrollees.

Managers of the CO-OPs that survived in 2017 and otherrelatively small, new plans have argued that therisk-adjustment program rules discriminate against smaller, newer,cheaper plans, by rewarding plans with higher premiums and moreinformation about their enrollees.

The risk-adjustment bills for 2016 came out in June.

Massachusetts regulators and Maryland regulators say they puttheir CO-OPs into receivership partly because the risk-adjustmentprogram managers sent the CO-OPs big risk-adjustment bills for2016.