The Center for Medicare and Medicaid Services made the decision to call in the loans to the Vermont Health CO-OP, forcing the nonprofit insurer to close.
"It's certainly a disappointment. It's very sad for all of us here who have worked very hard to try and get this to come to fruition and very sad for Vermonters that they now won't have this option in the marketplace in the future," said Christine Oliver, CEO of the Vermont Health CO-OP.
The nonprofit opened last fall and tried to become a member of the new health care exchange. Each state has the option of offering the co-op model for health insurance, but the Department of Financial Regulation says this co-op was not adequate and wouldn't be able to compete.
But Oliver says the CO-OP would have attracted Vermonters looking for another option.
"As we know with competition in general, it really does change the landscape. It requires others in that competition to be both more innovative," Oliver said.
Right now, residents have two options through the Vermont Health Connect-- MVP or Blue Cross Blue Shield.
The Vermont Department of Financial Regulation says all insurance companies go through the same application process, nonprofit and for profit. But In May, the state denied the CO-OP's license to offer insurance, citing high rates and an unstable business model. Now, the CO-OP is required to pay back all loans immediately.
"The solvency loans we drew on will just be wired back to CMS, the $9.8 million that people keep hearing about, the startup funding that we received in loan format, as well. We will use the remainder of what we have left to settle our claims with vendors," Oliver said.
Oliver hopes her colleagues can continue serving Vermonters in other ways. The shutdown means the co-op's 12 employees will lose their jobs. Vermont also has plans to implement a new health care system in the future-- Green Mountain Care. This will be a single-payer system, meaning it's paid for by the government. That system will go into effect in 2017.
Saturday, December 7 2013 8:32 AM EST2013-12-07 13:32:27 GMT
If you're lucky, you may have seen a snowy owl in Vermont. Researchers say the birds are traveling even farther south than usual -- some even as far south as North Carolina. We spotted one Friday afternoonMore >>
Researchers say snowy owls are traveling even farther south than usual, and that means more sightings here in Vermont.More >>
Saturday, December 7 2013 7:51 AM EST2013-12-07 12:51:22 GMT
South Burlington police say a shoplifter tried to hide her drugs by swallowing them at the police station. Police arrested Diana Matt Friday night at the University Mall Kohl's for allegedly stealingMore >>
South Burlington police say a shoplifter tried to hide her drugs by swallowing them at the police station.More >>
Saturday, December 7 2013 7:49 AM EST2013-12-07 12:49:56 GMT
Police in Brattleboro are looking for the driver of a car that hit and killed a pedestrian Friday night. Police say, just after 7 p.m., the car struck the man at Western Avenue and Union Street and thenMore >>
Police in Brattleboro are looking for the driver of a car that hit and killed a pedestrian Friday night.More >>
Friday, December 6 2013 11:16 PM EST2013-12-07 04:16:55 GMT
A Connecticut man is charged with DUI after police say he admitted to overdosing on prescribed Ritalin when he was pulled over. The incident happened on Route 105 in Berkshire late Friday afternoon. AuthoritiesMore >>
A Connecticut man is charged with DUI after police say he admitted to overdosing on prescribed Ritalin when he was pulled over.More >>
Friday, December 6 2013 10:03 PM EST2013-12-07 03:03:22 GMT
In Dorset, a car crashed into a bank and there was no drive-through lane.The car jumped the curb in front of the Berkshire Bank Friday morning, taking out a railing and getting hung up on the front steps.More >>
In Dorset, a car crashed into a bank -- and there was no drive-through lane. More >>
Friday, December 6 2013 10:01 PM EST2013-12-07 03:01:17 GMT
The longtime bookkeeper at Cold Hollow Cider Mill is expected to plead guilty to embezzling from the business and a local youth hockey program.Cold Hollow in Waterbury is one of Vermont's top tourist attractions.More >>
The longtime bookkeeper at Cold Hollow Cider Mill is expected to plead guilty to embezzling from the business and a local youth hockey program.More >>
Friday, December 6 2013 10:00 PM EST2013-12-07 03:00:14 GMT
Police in Burlington say they've caught an armed robber.Investigators arrested Tyran Sprauve, 19, Friday afternoon for assault and robbery. Police say last month he and two other men broke into a homeMore >>
Police in Burlington say they've caught an armed robber.More >>
Friday, December 6 2013 9:59 PM EST2013-12-07 02:59:17 GMT
A Claremont, New Hampshire couple is behind bars, charged with sexually assaulting two children under the age of five.Police say 25-year-old Kevin Blood and his 25-year-old wife, Ashley, were arrestedMore >>
A Claremont, New Hampshire couple is behind bars, charged with sexually assaulting two children under the age of five.More >>