Recently in Cooperatives Category

Co-Ops: A Design of Politics - Health Care Rx Panelists

Co-Ops: A Design of Politics

| 1 Comment

In hopes of extinguishing concerns of a government takeover and reducing the political risk for moderate senators, health-care co-ops have emerged as a compromise solution to the highly-contested public option. Ezra Klein is correct to point out that co-ops materialized as a necessity for the politics of health care, not as a first line answer to a health policy conundrum. As a result, the effectiveness of health care co-ops must be measured by their impact on policy (reducing costs and increasing insurance competition) and their impact on politics (increasing the prospect of passing health care reform).

The structure of health-care co-ops remains ill-defined. In order to have any impact, co-ops would have to achieve economies of scale- - a success that will hinge on their ability to attract a sufficient number of members, predicted at 500,000 customers, to negotiate competitive rates. Yet state or regional level organization may be more likely since attempts of organization at the national level would only recreate the political problems of a public plan; not only disappointing those on the left who view the public option as a necessity, but also reigniting cries of a government takeover. With national organization, conservative replays of Senator Reid's comments, "We're going to have some type of public option, call it 'co-op', call it what you want," would only gain more traction.

On a policy level, these co-ops most likely will lack the negotiation power of Medicare, reducing their ability to dramatically cut premiums. Yet, with the expected $6 billion dollars of seed money, co-ops could successfully emerge as an alternative to insurance monopolies in certain markets. Politically, this dissociation from the government buffers moderate Senators from political retribution by undermining suggestions of socialized medicine and bolsters President Obama's claim that if you like your health insurance, you can keep it.

Co-ops cannot be the major lever of cost control for health care; their existence will not alleviate the acute need to re-examine the health care finance and delivery systems or reshape preventive health. They may, however, provide President Obama the best opportunity to fulfill his desire of increasing choice, while avoiding the major government intervention that seems to ratchet up anti-reform dialogue.

1 Comment

We already have a similar private/public option choice: Some people prefer UPS or FedEx while others prefer the US Post Office.

Leave a comment

About this Archive

This page is a archive of recent entries in the Cooperatives category.

Abortion is the previous category.

Crime is the next category.

Find recent content on the main index or look in the archives to find all content.

Alternative to a Government Plan - Health Care Rx Panelists

Alternative to a Government Plan

| 1 Comment

Non-governmental, member-owned health-care cooperatives may well be a reasonable alternative to a government plan. The general public does not know enough about cooperatives but, given the uproar over health-cost reform, we should slow down and learn more about how they work. Current examples of cooperatives include the Group Health Cooperative in the state of Washington, Health Partners in Minneapolis and ACE Hardware. Google "healthcare cooperatives" and read about this member-owned idea.

Citizens are suspicious of the government's ability to run health care, no matter how well-intentioned the government might be. Medicare, Medicaid, the Post Office, Amtrak and Social Security are all on life support, and all are government run.

We need to slow down, consider different incentives that would result in private insurance companies structuring plans differently and carefully investigate how cooperatives could be structured so that they would contribute to an overall solution to our health care dilemma.

1 Comment

This is really disingenuous. This person should be required to disclose her conflicts of interests. To portray this person as a nurse or health care academician obfuscates her pro-business ties and allegiances. Why does it not say at the top that she's a highly compensated director for both a for-profit bank and a hospital group? Her pro-business, anti-government views make much more sense when you consider these facts.

Leave a comment

About this Archive

This page is a archive of recent entries in the Cooperatives category.

Abortion is the previous category.

Crime is the next category.

Find recent content on the main index or look in the archives to find all content.

Belaboring the Fix - Health Care Rx Panelists

Belaboring the Fix

| 2 Comments

The facts are plain and we cannot escape them: there are far too many Americans with inadequate health insurance or none at all. And those with insurance are no less vulnerable. Premiums are ridiculously high, competition is scarce, and the industry is allowed to cherry-pick--a callous method of "drop" and "deny" to protect profits. The reality, no matter how sour, is that our beloved health-care system is broken. Indeed, our physicians are among the best trained and our treatment facilities are world-class. Despite the bells and whistles, an underbelly of inflated costs, unequal access, inefficiencies and haphazard focus on wellness and prevention have wrought havoc.

Given that backdrop, shenanigans and obstructionist ideology have jeopardized reform. Though belabored, the obvious truth remains. The controversy, however, lies in the fix. Recent polls suggest Americans' resolve to enact meaningful legislation and alter the landscape has whittled, leaving lawmakers scurrying for political safety. Health-care cooperatives have been offered as middle ground, but in practice, it is questionable whether co-ops fit the scope and gravity of the problem.

With so many unknowns and variables, it is doubtful that co-ops will impact how private insurers do business and whether they can compete against industry giants and instigate price drops. There are no guarantees that doctors and hospitals will enlist or that the public will gravitate toward an untested notion. In principle, health cooperatives work only if a critical number of participants join. And outside a few locales, cooperatives are unfamiliar. Moreover, it is unclear that the left and right will coalesce around the idea. Some government involvement will be required and nowadays the legitimacy of government intervention has been assaulted.

The rhetorical back and forth over the last few days concerning whether the president had abandoned the public option caused a fair amount of whiplash. While some felt rear-ended by the administration's apparent retreat, proponents of health-care cooperatives sought to explain how the latter could satisfy all parties and offer a workable solution.

Though some have balked at the public option plan, alongside private insurers it has the best chance of ensuring choice, affordability and cost containment. In the message war, unfortunately, the public option has been married to the words "government takeover." It should not go unnoticed that the interest groups who have the most to lose are the most ardent in opposition. In the American health-care system there is no shortage of heroes, but now what's needed are legislators and a president who can articulate (without hyperbole) the stakes and forge a new path.

2 Comments

Your summary is correct. The co-ops will not begin to compete with the large insurance companies. There is no guarantee that these co-ops won't also cherry pick healthy participants to keep costs down. It does not facilitate equal access.
I am disappointed in the process of town halls and media arguing over a healthcare reform bill which doesn't exist. It once again is politics at its worst. They are latching on to "sound bites" and exaggerating them to inflame the public. Unfortunately, the public has a short attention span for any topic before they move on to the next. These politically charged erroneous statements will be difficult to overcome when and if a real healthcare reform bill comes along.
http://docinthetrenches.blogspot.com/

Nicely stated, Dr. Pernell. You are so right in your summary that the interest groups (and some individuals as some in the U.S. Congress) are most ardent in support since they have the most to lose. In this case, their loss seems to consist primarily of money and any associated power.

Leave a comment

About this Archive

This page is a archive of recent entries in the Cooperatives category.

Abortion is the previous category.

Crime is the next category.

Find recent content on the main index or look in the archives to find all content.

Co-Ops as an Alternative to the Public Plan - Health Care Rx Panelists

Co-Ops as an Alternative to the Public Plan

| No Comments

I've been on MSNBC twice today to explain the difference between a public option and a co-op. I think I'm getting sort of good at it. So I may as well do it here, too.

There's an idea out there called "the public option" grounded in a particular critique of the insurance industry. In particular, the argument is that the private health insurance industry is irreversibly compromised by its need to turn a profit. But we don't want people's access to health care to be governed by whether or not they're profitable.

The theory of the public option relies on the insights of the single-payer folks and the demonstration of Medicare, not to mention foreign systems: A robust public insurer can do a better job holding down costs and delivering access to high-quality care than a fractured private insurance system.

Obviously, a lot of people don't like these ideas. Among them are insurers, Republicans and, crucially, providers like doctors and hospitals, who fear that a large public insurer will hold down costs, which will in turn hold down incomes. They have argued, credibly, that they can unite and kill a bill that contains a strong public option.

In early June, Max Baucus asked Kent Conrad to solve this argument. Conrad came up with the co-op proposal. And I literally mean "came up" with it. Conrad told me that the idea emerged "out of conversations in my office after we were asked to see if we couldn't come up with some way of bridging this chasm." To put it bluntly, the co-op does not solve a policy problem so much as it solves a political problem. That political problem was, "How do you finesse a compromise on the public option?"

You could imagine a co-op proposal that actually offered a meaningful alternative to private insurers. Some months ago, Conrad, alongside public plan supporter Chuck Schumer, seemed to be edging in that direction. But I haven't heard anything similarly encouraging since then. The co-op is now a favored alternative for Republicans who don't agree that the profit motive is a problem in health insurance and who don't agree that single-payer or Medicare-for-All represents an appealing alternative to the current situation. Given that constituency, it's not likely to satisfy people who have the opposite perspective on all of those questions.

As the situation stands, there's no existing model for co-ops to follow and no policy specifics on Conrad's idea, so it's impossible to say whether, or how, they will work. I could imagine very good co-ops or totally useless ones. But given the political forces arrayed around the issue, I think that's sort of the wrong question. The idea works if it somehow solves the political problem that birthed it.

Leave a comment

About this Archive

This page is a archive of recent entries in the Cooperatives category.

Employer health plans is the previous category.

Health costs is the next category.

Find recent content on the main index or look in the archives to find all content.

Co-Ops Could Work As an Option - Health Care Rx Panelists

Co-Ops Could Work As an Option

| No Comments

Yes, health cooperatives are a viable option -- emphasis on option. Health-care reform is going to happen only if compromises are made. One compromise would be inserting co-ops in the place of a government-run plan that seems to be such a lightning rod for opposition.

Co-ops would be an option along with the current insurer structure. Other alternatives include accountable-care organizations that operate as non-profit organizations and the existing private insurers. Co-ops are another way of integrating the insurance, physician and hospital components under a different structure. Both co-ops and accountable-care organizations have the potential of covering more people.

One drawback with co-ops is that they do take a while to set up. To be effective, they need to provide coverage for a fairly large number of lives, some estimate up to 500,000. That certainly would not happen overnight, which calls into question Sen. Kent Conrad's (D-N.D.) assertion that with co-ops, we could quickly bring health insurance to 12 million people. I don't see that happening.

How are cooperatives set up? We have a couple of good examples: Group Health in Washington and Health Partners in Minnesota. Co-ops are organized with a governing body comprised of members from the organization; the average participating member has minimal input on the operations.

Co-ops provide two significant advantages: they would distance the government from the financial operations of the organization and, at a projected financial outlay of $6 billion, the start-up costs are significantly lower than the trillions projected for a public health plan.

Leave a comment

About this Archive

This page is a archive of recent entries in the Cooperatives category.

Abortion is the previous category.

Crime is the next category.

Find recent content on the main index or look in the archives to find all content.

Co-Ops: A Very Tall Order - Health Care Rx Panelists

Co-Ops: A Very Tall Order

| No Comments

Cooperatives are a very tall order: a new type of organization, never before tested on a large scale, meant to fix the apparently intractable problems of high and rising costs, barriers to access and poor quality care. Proponents can point to the impressive example of Group Health Cooperative of Puget Sound. But how that unique organization might get replicated thousands of times over, so that all of the U.S. is served by the new, improved approach, is hard to reckon.

For cooperatives to make a dent in the nation's health-care spending, we would need a great number of them to come into existence. They would have to enroll a significant portion of the population in their local areas. They would have to obtain favorable rates from doctors and hospitals. They would have to manage the utilization of their enrollees effectively. They would have to demand high levels of accountability and transparency from providers. They would have to be threatening enough to get the established players to behave differently. They would have to stay in business after the start-up funding ran out. And all of this would have to happen consistently with each and every new cooperative.

The idea that new organizations are the solution to our problems is enticing, but not indicative of success. A major feature of the U.S. health-care system is its lack of standardization. Each physician's practice is organized somewhat differently. Each hospital has its own approaches to caring for patients - and in most cases the physicians treating patients in the hospital each take a different approach. That is why we have the variation in care delivery that has been so widely documented (and in many quarters denounced).

There is no evidence to suggest that cooperatives might somehow create a more standardized approach to health-care delivery. If we thought of them as franchises, and knew how they should be organized and operated, and had someone in charge of making sure all the new franchises followed the model of success, perhaps the model could be successfully replicated. But right now the notion of cooperatives appears built more on hope than on a real strategy.

Leave a comment

About this Archive

This page is a archive of recent entries in the Cooperatives category.

Employer health plans is the previous category.

Health costs is the next category.

Find recent content on the main index or look in the archives to find all content.

Co-Ops Are Not the Solution - Health Care Rx Panelists

Co-Ops Are Not the Solution

| 1 Comment

Co-ops are unfortunately not the solution. Health co-ops as our only alternative to private insurers will fail to provide the level of competition and cost savings that is needed to truly reform our health system. A public option, with the stability and resources of the federal government backing it, would be a better and more formidable competitor to insurers and result in improved access to affordable care. Co-ops on the other hand, with their limited size, reach and negotiating ability, would be too weak to provide any real competition to the private insurance industry and we'd be in the same situation we are now with health-care costs spiraling out of control.

Co-ops will likely fall short in all three essential elements required of any new coverage option: cost, quality and access. Creating new co-ops will be expensive and since there will be multiple co-ops as opposed to one national plan, they can't take advantage the economy of scale of a national public option and build on the foundation that exists with other public plans. Health co-ops would lack the negotiation power of size to substantially lower prices, they would also be forced to spend a good bit of money on advertising and other administrative costs making them a poor substitute for the lower cost public plan, adverse selection for their risk pool would be a concern as well, as the co-op plan looked to ensure it had the funding to support anticipated claims for this underserved population. It remains to be seen how quickly co-ops can attract the level and quality of providers they will need to create a comprehensive plan or what the risk tolerance of providers will be to participate in a new untested system. Also, in question is the ability of these plans to keep the president's promise to allow people to keep their provider if they choose to.

Provider panels are an essential element of both quality and access, and health co-ops' capacity to ensure both in today's market is a real unknown.

The public option avoids all of these challenges and remains the best way to lower costs and improve access to care. The promise of health co-ops is an empty one that with few exceptions has gone the way of the buggy whip and carbon paper.

1 Comment

Co-ops , who dreamt up this idea, they may have a role in other area's of the economy but not in health matters. Perhaps you can throw some light on a matter that is of concern to all Americans, but never gets discussed. How can American taxpayer dollars be used to fund a universal health care plans in Afganistan and Iraq, yet Americans are being denied Universal Health care using part of there own taxpayer dollars. It looks like people oversea's are more a priority when it comes to health matters.

Who benefits from Co-ops, only the insurance comapnys. Co-ops will never be able to provide people with decent health care, it will result in more people going without proper medical care

Leave a comment

About this Archive

This page is a archive of recent entries in the Cooperatives category.

Abortion is the previous category.

Crime is the next category.

Find recent content on the main index or look in the archives to find all content.

Just Because You Build it Does Not Mean They Will Come - Health Care Rx Panelists

Just Because You Build it Does Not Mean They Will Come

| No Comments

I'm all for generating new ideas to reform the health-care system. The problem is that as often happens in Washington, people get tired of one idea and then move on to another. The danger is that nothing gets done in the end. I am concerned that we are now seeing this with the co-ops as an alternative to the public option.

Simply put, the co-op allows members of the public to come together and create a company to provide a type of service. Co-ops are much more popular in other industries than in health care. Like anything that involves the public, there are supporters and detractors. Ask a friend who lives in New York City, and you are bound to get an earful from one of them if they're housing situation is part of a co-op!

I've noticed that when people talk about co-ops, they often mention Group Health, a successful co-op in Seattle. However, that is the exception, and it took decades to be successful. And more importantly, being a co-op has not prevented it from raising premiums due to escalating costs of providing health care. At the end of the day, it's still essentially an insurance company with all the challenges of assessing risk. Just because a co-op is a non-profit doesn't mean it serves the public better as it relates to health care. If you're surprised by this statement, look at non-profit hospitals, and you will be shocked by how many of them provide little charity care.

Why don't we have more co-ops today? There has been very little regulation to prevent co-ops from existing already. And we should look at why that is the case. It is very challenging to get them to work effectively. Granted, some of these difficulties are because of the competition in the insurance space. However, just because you create a co-op in your area does not mean that people will come to it. Many consumers will stay with their current insurer unless the co-op can create more benefits for less cost. That is a tall order in today's environment, especially since the overall goal of health-care reform is to control costs, and co-ops have not controlled costs in recent years.

So let's go ahead and discuss the co-op. But let's not forget about the public plan either.

Leave a comment

About this Archive

This page is a archive of recent entries in the Cooperatives category.

Abortion is the previous category.

Crime is the next category.

Find recent content on the main index or look in the archives to find all content.

Keep Public Plan As a Fail-Safe - Health Care Rx Panelists

Keep Public Plan As a Fail-Safe

| No Comments

A non-profit co-op model health plan is worth a try particularly if it takes on some of the culture of a co-op: innovative strategies in the best interest of each individual. I think that the public plan can and should remain as a fail-safe if this does not work.

Since coverage for all is in the best interest of providers, payment for co-ops could be phased based on the cost effectiveness of regional or state provider systems with a public plan as a fail-safe.

Leave a comment

About this Archive

This page is a archive of recent entries in the Cooperatives category.

Abortion is the previous category.

Crime is the next category.

Find recent content on the main index or look in the archives to find all content.

The Health Cooperative "Razzle Dazzle" - Health Care Rx Panelists

The Health Cooperative "Razzle Dazzle"

| No Comments

In the Broadway show "Chicago", the star defense attorney wins the case by giving the jury the "old razzle-dazzle." The American public is getting the same treatment with health-care cooperatives. These programs are being pitched as something magical when, in fact, they are risky not-for-profit insurance businesses.

Such companies are nothing new and exist in many regions. At Henry Ford, our Health Alliance Plan (HAP) was originally founded by the United Auto Workers. Even with its not-for-profit status, HAP must play by the same economic rules as every other insurance company -- match premiums with actuarial risk or become insolvent.

Running a health insurance plan is complicated. It requires expertise in health risk assessment, claims, contracting and quality management. The plan must have significant scale and reserves to cover claims and complete in the marketplace. Over the last decade many small insurance companies have folded or been sold off because they could not meet these challenges.

In the health reform debate, the public is being offered "cooperatives" instead of a federally managed public plan. This may seem like a retreat, when, in fact, it is smart politics. Very few health cooperatives have ever been successful and new entries will meet the same fate. The business is too difficult and without scale, cooperatives will have no leverage to change delivery models. Some may even require a federal bailout.

Once that drama plays out, the public plan will look more attractive. Like it or not, only the federal government is powerful enough to change the direction of health care delivery.

Meanwhile, we will have to endure the health cooperative "razzle-dazzle."

Leave a comment

About this Archive

This page is a archive of recent entries in the Cooperatives category.

Abortion is the previous category.

Crime is the next category.

Find recent content on the main index or look in the archives to find all content.

About this Archive

This page is a archive of recent entries in the Cooperatives category.

Abortion is the previous category.

Crime is the next category.

Find recent content on the main index or look in the archives to find all content.