For many, the term co-op evokes images of grain elevators, Depression-era workers stringing electric lines or maybe the more contemporary picture of a place where local-food devotees go to get a weekly helping of fresh produce.
But a group at work in Wichita has a different vision. They are working to develop a member-owned co-op that would provide thousands of Kansans with health insurance. And they want the coverage to be different from plans offered by traditional carriers.
Anne Nelson, associate director of the Central Plains Health Care Partnership in Wichita, an affiliate of the Medical Society of Sedgwick County, said the goal is to create a Kansas cooperative that offers individual and small business coverage that is both affordable and innovative in that it will emphasize patient-centered and preventive care.
“There will be a direct relationship with the people who are served by the products in the plan. If a product isn’t working based on consumer feedback, the consumer leaders (of the cooperative) can make changes,” Nelson said.
If the co-op does well financially, it would be required to use money not needed for claims or state solvency requirements to lower premiums or increase benefits.
Working with a small planning committee that includes health care providers, lawyers, actuaries, insurance experts and representatives of the business community, Nelson is preparing to apply for millions of dollars in federal loans to fund the launch of the nonprofit health insurance cooperative. She said she plans to submit the loan application this fall to the U.S. Department of Health and Human Services, which already has provided nearly $850 million in start-up and sustainability loans to health insurance cooperative in 10 states.
The loans approved earlier this year ranged from around $57 million to a cooperative in Oregon to nearly $175 million to the Freelancers Health Service Corporation, a union-affiliate co-op in New York. Midwest Members Health, which is planning to offer coverage to residents of Iowa and Nebraska, received $107 million.
“We don’t know yet what our application will be. But it’s a multimillion-dollar project,” Nelson said.
Money in health reform law
Creating more competition in the health insurance marketplace is one of the objectives of the controversial and still not-well-understood Affordable Care Act. The health reform law authorizes $3.4 billion in low-cost federal loans to start and help sustain at least one consumer-governed health plan in each state