Health insurance cooperative

Last updated

A health insurance cooperative is a cooperative entity that has the goal of providing health insurance and is also owned by the people that the organization insures. It is a form of mutual insurance.

Contents

United States

In the debate over healthcare reform, healthcare cooperatives are posited as an alternative to both publicly funded healthcare and single-payer healthcare.

Cooperatives had been proposed as part of the healthcare reform debate in the United States by the Barack Obama administration as a possible compromise with Blue Dog Democrats (as well as with Republicans) in the search for universal healthcare in the United States. [1] [2] [3] As proposed by President Obama and others, a future health insurance cooperative would not be government owned or run, but would instead receive an initial government investment and would then be operated as a non-profit organization. [4]

While a health insurance co-op is not strictly run by the government, hence not making it a public entity, it has been described by former Senator Max Baucus of Montana, who was the chairman of the United States Senate Committee on Finance until his retirement from the Senate in 2014, as "tough enough to keep insurance companies’ feet to the fire." [5] He proposed a bill that includes a health insurance cooperative instead of the public option. [6]

There once were numerous rural health cooperatives established by the Farm Security Administration (FSA). Most of them closed or merged over the years, generally because they lacked a sufficient economy of scale (i.e., they were too small to function efficiently). Thus, co-operatives currently have so little market share as to be "invisible". [7]

The bill proposed by Max Baucus, the America's Healthy Future Act, which uses health insurance cooperatives, was estimated by the Congressional Budget Office to cost $829 billion over ten years, and because of the increase in taxes of $210 billion over 10 years [8] on premium insurance plans with high benefits, would lead to a reduction in the deficit of $81 billion. [9] It would expand coverage to 94 percent of all eligible Americans. [10]

Support

During a September 2009 report by John King of CNN, he stated that "supporters know, here in Minnesota and other farm states think co-ops could solve at least a big chunk of the healthcare access and affordability problem." He interviewed Bill Oemichen, President of the Cooperative Network, who remarked that "where co-ops are, they tend to be very, very high quality because it is the consumer who owns them, that is making sure that their health care provider is a quality health care provider." Oemichen also stated that 65% of those who switched from typical health insurance reported better coverage and service. [11]

In June 2009, Republican Senator Chuck Grassley told reporters, "if it’s all done entirely within the private sector, you know, it doesn’t seem to me it’s got the faults that you have... by having the government institute something." [12] Steven Hill, a program director at the New America Foundation, has written for Salon.com that "co-ops may hold the key to a substantive compromise", comparing the U.S. reform proposals with health care in Germany. He argued that they can produce quality care for less money given that they would lack the profit motive, they would negotiate fees for service, and that they would end current market monopolies that insurance companies have in several states. [13]

Criticism

Howard Dean and other Democrats have criticized abandoning the idea of a federally run, statewide, public option in favor of co-ops, questioning whether the co-ops would have enough negotiating power to compete with private health insurers. [12] The activist groups SEIU and MoveOn.org have also stated their opposition. [12] 2008 Nobel Economics Laureate Paul Krugman and political commentator Robert Reich have also questioned co-ops' ability to become large enough to reduce health care costs significantly. Thus, they both support the public option instead, which they state has strong opposition from the insurance industry. [14] [15]

Examples

See also

Related Research Articles

<span class="mw-page-title-main">Max Baucus</span> American politician (born 1941)

Maxwell Sieben Baucus is an American politician who served as a United States senator from Montana from 1978 to 2014. A member of the Democratic Party, he was a U.S. senator for over 35 years, making him the longest-serving U.S. senator in Montana history. President Barack Obama appointed Baucus to replace Gary Locke as the 11th U.S. Ambassador to the People's Republic of China, a position he held from 2014 until 2017.

<span class="mw-page-title-main">Cigna</span> American health services organization

The Cigna Group is an American multinational managed healthcare and insurance company based in Bloomfield, Connecticut. Its insurance subsidiaries are major providers of medical, dental, disability, life and accident insurance and related products and services, the majority of which are offered through employers and other groups. Cigna is incorporated in Delaware.

Single-payer healthcare is a type of universal healthcare in which the costs of essential healthcare for all residents are covered by a single public system.

<span class="mw-page-title-main">Medicare for All Act</span> Proposed U.S. healthcare reform legislation

The Medicare for All Act, also known as the Expanded and Improved Medicare for All Act or United States National Health Care Act, is a bill first introduced in the United States House of Representatives by Representative John Conyers (D-MI) in 2003, with 38 co-sponsors. In 2019, the original 16-year-old proposal was renumbered, and Pramila Jayapal (D-WA) introduced a broadly similar, but more detailed, bill, HR 1384, in the 116th Congress. As of November 3, 2019, it had 116 co-sponsors still in the House at the time, or 49.8% of House Democrats.

The Healthy Americans Act(HAA), also known as the Wyden-Bennett Act, is a Senate bill that had proposed to improve health care in the United States, with changes that included the establishment of universal health care. It would transition away from employer-provided health insurance, to employer-subsidized insurance, having instead individuals choose their health care plan from state-approved private insurers. It sought to make the cost of health insurance more transparent to consumers, with the expectation being that this would increase market pressures to drive health insurance costs down. The proposal created a system that would be paid for by both public and private contributions. It would establish Healthy Americans Private Insurance Plans (HAPIs) and require those who do not already have health insurance coverage, and who do not oppose health insurance on religious grounds, to enroll themselves and their children in a HAPI. According to its sponsors, it would guarantee universal, affordable, comprehensive, portable, high-quality, private health coverage that is as good or better than Members of Congress have today; A 2008 preliminary analysis by the Congressional Budget Office concluded it would be "essentially" self-financing in the first year that it was fully implemented.

Healthcare reform in the United States has a long history. Reforms have often been proposed but have rarely been accomplished. In 2010, landmark reform was passed through two federal statutes: the Patient Protection and Affordable Care Act (PPACA), signed March 23, 2010, and the Health Care and Education Reconciliation Act of 2010, which amended the PPACA and became law on March 30, 2010.

The history of health care reform in the United States has spanned many decades with health care reform having been the subject of political debate since the early part of the 20th century. Recent reforms remain an active political issue. Alternative reform proposals were offered by both of the major candidates in the 2008, 2016, and 2020 presidential elections.

The healthcare reform debate in the United States has been a political issue focusing upon increasing medical coverage, decreasing costs, insurance reform, and the philosophy of its provision, funding, and government involvement.

The proposed America's Affordable Health Choices Act of 2009 was an unsuccessful bill introduced in the U.S. House of Representatives on July 14, 2009. The bill was introduced during the first session of the 111th Congress as part of an effort of the Democratic Party leadership to enact health care reform. The bill was not approved by the House, but was superseded by a similar bill, the proposed Affordable Health Care for America Act, which was passed by the House in November 2009, by a margin of 220-215 votes but later abandoned.

<span class="mw-page-title-main">Wendell Potter</span> Former U.S. health insurance executive turned universal health care advocate

Wendell Potter is an American advocate for health insurance payment reform, New York Times bestselling author, and former health insurance industry communications director. A critic of HMOs and the tactics used by health insurers, Potter is also a leading national advocate for major reforms of the health insurance industry, including Medicare for All and universal health care.

The public health insurance option, also known as the public insurance option or the public option, is a proposal to create a government-run health insurance agency that would compete with other private health insurance companies within the United States. The public option is not the same as publicly funded health care, but was proposed as an alternative health insurance plan offered by the government. The public option was initially proposed for the Patient Protection and Affordable Care Act, but was removed after the independent US senator for Connecticut Joe Lieberman threatened a filibuster.

<span class="mw-page-title-main">September 2009 Barack Obama speech to a joint session of Congress</span>

Barack Obama, the 44th President of the United States, discussed his plan for health care reform in a speech delivered to a joint session of the 111th United States Congress on September 9, 2009 at 8:00 PM (EDT). The speech was delivered to Congress on the floor of the chamber of the United States House of Representatives in the United States Capitol. House Speaker Nancy Pelosi presided over the joint session and was accompanied by the President of the United States Senate, Joe Biden, the Vice President of the United States. Energy Secretary Steven Chu was chosen as the designated survivor and did not attend the speech.

The America's Healthy Future Act was a bill proposed by Democratic Senator Max Baucus of Montana, who chaired the Senate Finance Committee, on September 16, 2009. It is also colloquially known as the Baucus Health Bill, the Baucus Health Plan, or BaucusCare. Baucus initially publicly released a 223-page summary of the proposal. It started going through the Senate mark-up process on September 22. That amendment process finished Oct. 2, and was passed by the Finance Committee on October 13 by a 14 to 9 vote,. An October CBO report stated that enacting the proposal would, on net, end up reducing the federal deficit by $81 billion over the 2010–2019 period.

A health insurance mandate is either an employer or individual mandate to obtain private health insurance instead of a national health insurance plan.

The Affordable Health Care for America Act was a bill that was crafted by the United States House of Representatives of the 111th United States Congress on October 29, 2009. The bill was sponsored by Representative Charles Rangel. At the encouragement of the Obama administration, the 111th Congress devoted much of its time to enacting reform of the United States' health care system. Known as the "House bill,” HR 3962 was the House of Representatives' chief legislative proposal during the health reform debate.

There were a number of different health care reforms proposed during the Obama administration. Key reforms address cost and coverage and include obesity, prevention and treatment of chronic conditions, defensive medicine or tort reform, incentives that reward more care instead of better care, redundant payment systems, tax policy, rationing, a shortage of doctors and nurses, intervention vs. hospice, fraud, and use of imaging technology, among others.

<span class="mw-page-title-main">Affordable Care Act</span> U.S. federal statute also known as Obamacare

The Affordable Care Act (ACA), formally known as the Patient Protection and Affordable Care Act (PPACA) and colloquially as Obamacare, is a landmark U.S. federal statute enacted by the 111th United States Congress and signed into law by President Barack Obama on March 23, 2010. Together with the Health Care and Education Reconciliation Act of 2010 amendment, it represents the U.S. healthcare system's most significant regulatory overhaul and expansion of coverage since the enactment of Medicare and Medicaid in 1965.

Health Republic Insurance of New York was a not-for-profit health insurance cooperative in New York State.

The Patient Protection and Affordable Care Act, often shortened to the Affordable Care Act (ACA) or nicknamed Obamacare, is a United States federal statute enacted by the 111th United States Congress and signed into law by President Barack Obama on March 23, 2010. Together with the Health Care and Education Reconciliation Act of 2010 amendment, it represents the U.S. healthcare system's most significant regulatory overhaul and expansion of coverage since the passage of Medicare and Medicaid in 1965. Once the law was signed, provisions began taking effect, in a process that continued for years. Some provisions never took effect, while others were deferred for various periods.

Mountain Health CO-OP, formerly Montana Health CO-OP, is a nonprofit, member-led health insurance company that currently offers products in Montana, Idaho, and Wyoming. The company was founded as a health insurance cooperative under a provision of the Patient Protection and Affordable Care Act for the purpose of introducing more competition into state insurance markets.

References

  1. "White House appears ready to drop 'public option'" Retrieved on August 17, 2009
  2. "White House Appears Open to Insurance Co-ops" New York Times Retrieved on August 17, 2009
  3. "Chances Dim for a Public Plan" The Wall Street Journal Retrieved on August 18, 2009
  4. "President Obama Considering Insurance Co-Op" KKTV.com Archived 2019-04-01 at the Wayback Machine Retrieved on August 17, 2009
  5. "Co-op Health Plan Emerging as a Senate Option" New York Times Retrieved on August 17, 2009
  6. "Zen Health Reform" - Slate.com Retrieved September 18, 2009
  7. Michael R. Grey. New Deal Medicine: The Rural Health Programs of the Farm Security Administration. Baltimore: Johns Hopkins University Press. 1999.
  8. The Atlantic, "New CBO Score Of Baucus Bill" 07 Oct 2009
  9. "The Baucus Bill Cuts The Deficit", The Atlantic Retrieved October 7, 2009
  10. "Health bill would cost $829B, help cover 94 pct" - Seattle Times Retrieved August 7, 2014
  11. John King (September 6, 2009). "Interview With Senators Klobuchar, Nelson; Interview With Governor Pawlenty". State of the Union with John King . Retrieved September 21, 2009.
  12. 1 2 3 Wangsness, Lisa (June 21, 2009). "Health debate shifting to public vs. private". Boston Globe . Retrieved September 21, 2009.
  13. "Relax. You'll love healthcare cooperatives! Honest". Salon. 12 October 2009.
  14. "Where to find me".
  15. Paul Krugman (September 17, 2009). "Baucus and the Threshold". The New York Times . Retrieved September 21, 2009.