Can Health Co-Ops Do the Job of a Public Plan?

"The history of cooperative is that it's very hard to set these things up, and while we're trying to set them up, there's not going to be accountability and pressure [on private insurers]," says Hacker. "They would be weakest when they're most needed — at the outset." In addition, cooperative health policies would not be portable, meaning if you had one and moved to another state, you would need to drop coverage and enroll elsewhere. Rates could also vary dramatically, depending on regional differences in health costs and the size and makeup of co-op pools.

Assuming state-based health co-ops could offer lower premium costs by being nonprofit and creating large risk pools, an equally crucial question is when they would be created. Even with federal seed money, setting up 50 co-op boards, signing up enough members to make each co-op viable and establishing administrative systems to set premium rates and pay claims would not happen overnight. "The principle of eliminating some of the profit motive and placing it with the motive to get value out of care is a good principle," says Karen Davis, president of the Commonwealth Fund, a nonpartisan health-policy think tank. "But there are a lot of ifs, and it's not a strategy for a nation in an economic crisis when we need a solution soon."

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