One of five health insurance co-ops that are still offering Obamacare plans this year projected a $39 million loss, citing challenges with Obamacare’s risk-adjustment program.

Obamacare originally created 23 co-ops that received $2.4 billion in taxpayer-funded loans. Eighteen of the 23 co-ops have either gone out of business or are not offering Obamacare plans this year, with many citing financial losses.

Minuteman Health, one of the remaining co-ops serving New Hampshire and Massachusetts, projeted losses of $39 million in its 2016 annual financial statement. The projected loss is driven by the federal government’s risk adjustment program, which is designed to transfer money from insurers with healthier, less expensive patients to insurers with sicker, more expensive patients. The federal government is charging Minuteman Health $29.8 million and $23.7 million for its projected risk adjustment payments in 2016-17, respectively.

The co-op reported serious losses despite increasing its membership by 12,438 over a year and adding health care providers to its network. The co-op said its greatest challenge is Obamacare’s risk adjustment program, which it said punishes smaller, more efficient carriers.

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