So Congress Broke the Law When It Took Down My Healthcare Insurer

One of the few times in the last two decades when my monthly health insurance payments decreased from year to year was in 2015, when a new kind of health insurer appeared on the Rochester, N.Y. scene. Health Republic was a cooperative health insurance company, reportedly formed by a bunch of freelancers like me who were tired of seeing their health insurance premiums rise by double digits every year. Recognizing an opportunity created under Obamacare, these New York City-based entrepreneurs put their money where their mouth was. 

I was totally sympathetic to their story—a story that would have glazed me over before I became a freelancer. I remember my boss at a small public relations firm complaining about the rising costs of health insurance in the 1980s. I never saw the numbers, never saw what they did to my salary and the company’s expense ledger. It meant nothing to me. 

That changed when I became a freelancer in 1996 and became responsible for my own healthcare insurance. At the time I thought I was fortunate to be in a city President Clinton had held up as a model of how healthcare should be done, and it seemed to work. In the year 2000, I was paying only $163.99 a month for health insurance coverage that required just $15 co-pays for doctor visits.  

But my healthcare heaven soon evaporated. After two decades of increases, many at double-digit percentages, my monthly healthcare bill last year was 2.24 times higher than in 2000, and for that I paid full price on nearly all of my doctor visits. 

Outpacing My Wage Increases

Over that time, my hourly rate increased by much less, just 1.42 percent. Only my property taxes came close to keeping pace with healthcare costs. They doubled. But that’s deceptive. The city services my taxes paid for held steady, while my healthcare insurance now covered mainly my catastrophic needs. An equivalent change from the city might have required me to clear the snow from the city road in front of my house for snowfalls of less than 12 inches. (Don’t get any ideas, Mayor Warren!)

Our savings with Health Republic in 2015 weren’t huge, dropping just $3.33 from $502.62 to $499.29. But when Health Republic was forced to close late in the year, we had to sign up with Excellus Blue Cross Blue Shield for December at $602.32 per month, a $100+ increase. 

The reason Health Republic had to liquidate was that the Republican-led Congress refused to allocate the funding the company was owed, as prescribed under Obamacare. The law stated that participating health insurers would receive Federal funding to cover losses when premium payments fell short of medical expenses. (The companies were also required to pay some of any profits they gained to the government.) That law no longer stands, but in those early days, it helped ease health insurance companies into a fledgling market not knowing how many people would sign up. 

This past Monday, April 27, the U.S. Supreme Court voted 8-1 that Congress broke the law when its payments to multiple insurers came up $12 billion short. On a court that’s packed with conservatives, many of whom appear to be sympathetic with Republican (and anti-Obamacare) causes, that’s a definitive judgment.  

The Damage Done

This unlawful act resulted in Health Republic and a handful of other newly formed healthcare cooperatives getting less than 13 cents on the dollar of their promised Federal funding, according to an article in The New York Times. Many were forced to cease operation, and they won’t be coming back. Careers were sidetracked, and consumers were harmed, including me, not just because we had to pay higher prices that December, but because we lost a potential source of lower cost healthcare insurance moving forward. 

That was depressing. And it’s a reminder that the current administration didn’t pioneer disregard for the law at the highest levels, nor is it the first to go unpunished for unlawful acts. 

Today, Health Republic can be found at this website, where the company has been reduced to a stark legalese description of its process for liquidation and repayment of creditors. At the time I’m posting this, one FAQ response reads, “It is not yet known how long the liquidation proceeding will last due to, among other things, lack of certainty regarding the timing and amount of potential recoveries by Health Republic from programs established by the federal Patient Protection and Affordable Care Act of 2010.”

I’d like to think that the U.S. Supreme Court decision delivers the certainty that Health Republic has been seeking since 2015, but actually it doesn’t. Now the Mitch McConnell-led Senate must decide whether or not it will abide by the Supreme Court’s ruling. 

Photo of the inside of the Supreme Court by Phil Roeder – Flickr: Supreme Court of the United States, CC BY 2.0,

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