Senator Proposes Insurance Cooperatives as an Alternative to Public Plan Option

Janice Simmons, for HealthLeaders Media , June 11, 2009

In the United States, there are rural electric co-ops, milk co-ops, child care co-ops, and food co-ops. So why not healthcare co-ops?

The idea of member-run healthcare insurance cooperatives was proposed this week by Senate Budget Committee Chairman Kent Conrad (D-ND) as an alternate approach to proposed public health insurance options in healthcare reform legislation pending on Capitol Hill—and it has been garnering its share of attention.

The reason primarily is because it is not a government-run program—a major sticking point for many Senate Republicans and some Democrats about public insurance plans. And, the idea may not be as far-fetched as some may think.

In discussing his idea, Conrad points out that the Group Health Cooperative, based in Seattle, is a consumer governed, nonprofit healthcare system; the cooperative has operated for more than 60 years and serves more than half a millon residents in Washington State and Idaho.

As proposed, a health cooperative is owned and operated for the benefit of its members—individuals and businesses with fewer than 10 employees. Senate Finance Chairman Max Baucus (D MT) on Wednesday requested that Conrad work with Sen. Charles Schumer (D NY), an author of a healthcare reform bill himself, to iron out details.

According to Baucus, who is preparing to mark-up a healthcare reform bill next week, Conrad's proposal remains "an option." Baucus' Republican counterpart on the committee, Sen. Charles Grassley (R-Iowa), said it could have potential.

But other ideas still abound on the committee regarding a public insurance plan. On Wednesday, Sen. John Rockefeller IV (D-WV), chairman of the Senate Finance Subcommittee on Health Care, introduced a new measure that would establish and offer a public plan option within a national health insurance exchange.

Under Rockefeller's proposal, a new Office of Health Plan Management within the Department of Health and Human Services would operate the plan. The president would appoint an administrator of the plan, which would be financially sustaining—subject to an annual third-party audit.

Funds to operate the plan would come from premiums from individuals enrolled in the plan and from contributions of employers not providing health insurance benefits. To help consumers make informed choices, the national office would be required to "promote consistent standards" for information about the plan and "to promote transparency in coverage" to consumers and healthcare providers.

In a statement accompanying the introduction of his legislation, Rockefeller emphasized that "a public plan is the only real solution" to addressing current challenges under the healthcare system.

Janice Simmons is a senior editor and Washington, DC, correspondent for HealthLeaders Media Online. She can be reached at

Comments are moderated. Please be patient.




FREE e-Newsletters Join the Council Subscribe to HL magazine


100 Winners Circle Suite 300
Brentwood, TN 37027


About | Advertise | Terms of Use | Privacy Policy | Reprints/Permissions | Contact
© HealthLeaders Media 2016 a division of BLR All rights reserved.