Co-ops are coming. What’s a Co-op?
The Patient Protection and Affordable Care Act of 2010 (PPACA) authorized the formation of new State-based nonprofit health insurance co-operatives (co-ops). These new co-ops will be founded and supported in the early years by Federal loans authorized by the Department of Health & Human Services (HHS). Starting in early 2012, and continuing throughout the year, we expect that HHS will announce the formation of several State-based co-ops along with the award of low interest Federal loans to act as the start-op capital needed to build the entities from scratch.
By law, co-ops will be governed by its health insurance customers through a directly elected Board. As a nonprofit, the Board will be acting in the best interests of its customers and return excess profits to its customers in the form of dividends or lower premiums. The promise of the co-op program is to add competition to the market and design integrated delivery systems and transparent business models in order to ultimately bring pressure on the rising cost of health insurance.
We are proud of our work with the Freelancers Union in their successful application to sponsor State co-ops in NY, NJ and OR. http://freelancersunion.org/co-ops/
For more on the co-op program, see http://cciio.cms.gov/programs/coop/index.html