The nation's 23 nonprofit consumer oriented and operated plans (CO-OP) created by the Affordable Care Act have an uneven track record as the enrollment deadline for individual plans approaches, The New York Times reported, with price emerging as a determinant of success.
Maine's CO-OP, for example, offers the cheapest health insurance plans in every category and has grabbed the lion's share of enrollment, outpacing Anthem. In contrast, HealthyCT--a new Connecticut-based insurer--charged up to 29 percent more than its competitors and signed up only about 3 percent of the state's marketplace buyers.
Meanwhile, CoOportunity Health of Iowa and Nebraska enrolled more than 35,000 members in three months and earned $127 million, as FierceHealthPayer reported.
CO-OPs offer the lowest price in about one-third of the markets where they operate, an analysis by the Times found. And states with CO-OPs have premiums that average 8.5 percent lower than states without them, according to Kaiser Health News. But experts question whether CO-OPs that underpriced their offerings can survive if their membership generates high medical expenses, KHN noted.
A report by the U.S. Office of Inspector General found 11 of 16 licensed CO-OPs were in precarious financial condition, with estimated start-up costs exceeding the federal funding they received, the Times reported. And CO-OPs cannot use start-up funds to advertise, KHN noted.
So CO-OPs like Maryland's Evergreen Health are working to broaden their customer bases. Evergreen Health is selling to small businesses and seeking state regulatory approval to market products to large private employers, The Baltimore Business Journal reported. Further, Evergreen Health is trying to enter the government business arena by answering requests for proposals to insure state and municipal government groups.
As they market themselves as community-friendly alternatives to large insurance companies, the fate of CO-OPs may indicate ACA success, the Times noted. "If we start being a little Aetna or a little Anthem, that's not going to work for us," HealthCT CEO Ken LaLime told the Times. "At the end of the day, it's more than just a job. There's a passion behind it."
For more:
- read the New York Times article
- see the KHN article
- here's the Baltimore Business Journal article