ObamaCare Cash Awarded to Administration's Political Allies

Last week, I discussed how taxpayer funds are being granted, through ObamaCare, to construct “School-Based Health Centers.” Now, let’s take a look at ObamaCare’s “CO-OP’s.”

CO-OP’s, or Consumer Operated and Oriented Plans, are the new, non-profit face of ObamaCare in the states’ “exchanges.” If ObamaCare is allowed to stand, CO-OP’s will be a step toward the “public option,” on a state level. Healthcare.gov provides a “feel-good” definition of CO-OP’s as “a new type of non-profit health insurer” that is “directed by their customers and designed to offer individuals and small businesses more affordable, consumer-friendly and high quality health insurance options.” In addition, there is considerable boasting on the part of HHS that CO-OP’s are special in that they can be mandated by the government to control waste, fraud, and abuse. Now there’s a good promo: buy your health insurance from a CO-OP, because the federal government will make sure there is no waste, fraud, and abuse.

Recall that the reason this utopian “commercial” for CO-OP plans is being pitched to “individuals and small businesses” is that, despite what President Obama told us, under ObamaCare, these sectors will no longer be able to keep their private health insurance because of the cost. Enter the “exchanges,” and the choice of a “non-profit.” Actually, CO-OP’s have five years within their inception to become “non-profit.” Any “profit” they make during the first five years must be paid toward their “loans” from the federal government. Call me cynical, but I’ll believe that if it happens.

This past week, the Obama administration awarded $66 million in loan grants from the controversial health care reform law’s funds to a Nevada Insurance CO-OP, known as “Hospitality Health CO-OP,” that is apparently unregistered as a business with the Nevada Secretary of State’s office. Obamacarewatcher.org, a project of Americans for Limited Government Research Foundation (ALG), is reporting that a follow-up call to the office of the Secretary of State has confirmed that “Hospitality Health CO-OP” is not registered with that office.

Healthcare.gov states that “Hospitality Health CO-OP” was sponsored by a “Taft-Hartley” union benefits plan, called the “Culinary Health Fund,” and by the “Health Services Coalition,” an organization of primarily unions and casinos. Culinary Health Fund’s parent organization, Unite Here Health, is also sponsoring the benefits plan.

According to Healthcare.gov, to date nearly $1 billion in the form of low-interest loans has been awarded to non-profits, in 12 states, to help them set up and maintain CO-OP’s that will be ready to operate in January of 2014.

Interestingly, the Obama administration initially estimated that 30-35% of the $3.8 billion in loans to CO-OP’s will default. However, according to ALG, the default rate will probably be more like 43%. Another great waste of taxpayer money.

Other organizations that have received award money in loans through ObamaCare include Wisconsin-based Common Ground Healthcare Cooperative, a group that, according to Bill Wilson, president of ALG, was an outgrowth of a Saul Alinsky operation in Chicago. The Common Ground Healthcare Cooperative, which incorporated last August, just a few months before the loan applications were due, received $56 million to set up a CO-OP.

The Freelancers Union was awarded more than $340 million in loans through ObamaCare funds to set up a CO-OP as well. The Freelancers Union is, according to Wilson, a group headed by Sara Horowitz, with whom President Obama served as an adviser to the leftist group, Demos, along with former green czar Van Jones.

Rep. David Camp (R-Michigan), chairman of the House Ways and Means Committee, has described the millions of dollars loaned to these organizations to develop ObamaCare’s CO-OP’s as “rewards” for “political friends.”

Congresswoman Michele Bachmann was right about defunding ObamaCare. It should have happened yesterday.