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Robert Longley

What are Nonprofit Health Insurance Cooperatives?

By August 17, 2009

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Appearing Sunday on CNN’s “State of the Union,” Sec. of Health and Human Services Kathleen Sebelius suggested that the Obama administration might be willing to consider nonprofit insurance cooperatives as an alternative to its controversial government-run public insurance plan. Nonprofit cooperatives are far from a new idea. In fact, you may already belong to one.

According to the International Co-operative Alliance, a “cooperative” is an autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly-owned and democratically-controlled enterprise.

Nonprofit cooperatives have been around for years. If you, like millions of Americans, belong to a credit union or get your electricity from Rural Electric Association, you belong to a cooperative. Banking, utilities and agricultural cooperatives are widespread and growing.

From the health insurance perspective, health insurance cooperatives are already operating in several states where they strive to secure affordable group insurance for small business owners, writers, farmers and many other small employers.

Pros of Health Insurance Cooperatives: Because of their nonprofit status, health insurance cooperatives enjoy tax savings they can pass along to their members in the form of reduced premiums, co-pays, prescriptions and other health care costs. In addition, cooperatives typically represent a large number of members, thus giving them extra bargaining power when negotiating with the insurance companies.

Cons of Health Insurance Cooperatives: Even as their nonprofit status gives insurance cooperatives tax advantages, it burdens them with financial disadvantages. Nonprofit organizations that get into financial trouble – which many do in bad economic times – have far fewer options for recovery than regular for-profit companies, potentially leaving their members at risk of losing their insruance. In addition, some states do not apply the same consumer protection regulations to cooperative insurance associations as they do to private insurance companies.

Also See:
Pros and Cons of Government Health Care
Is the US Really That Uninsured?
Employment No Guarantee of Health Insurance

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Comments

August 17, 2009 at 2:55 pm
(1) Margaret Bitz says:

North Dakota Blue Cross/Blue Shield began as a cooperative health insurance plan. It has morphed into something whereby the owners have virtually no say. Nominations for new Board members are basically ignored because the Nominating Committee virtually has its own choices pre-picked.

Meetings for members are barely advertised and no incentives are given for people to attend because there is no option for people to say anything (quite contrary to the way The Farmers Union operates).

Furthermore, The Board and the CEO were so flagrant in their spending indicating there was no member say. Eventually the Board fired the CEO but where were its members while all the spending was going on? The Blues were requesting a premium rate increase from the State Insurance Commissioner because of inflation when in fact they had the money to take the Board members and significant others on a Carribean Board meeting. In the meantime the premium increase for the Medicare supplement had a 14% increase. “Let’s gouge the federal government seems to be the attitude. But let’s condemn any federal government option because it might challenge our status.”"

In the end, even cooperatives need to be regulated.

August 17, 2009 at 3:51 pm
(2) Brittancus says:

If there was ever a time for a national referendum–THEN THIS IS DEFINITELY IT? Of all the issues the ones that will influence the American peoples economy, culture, language and society for decades to come, is Health care and illegal immigration. Neither political party, special interest lobbyists nor anybody else should be able to use their influence the running of our country. The United States–VOTER–should have the last word, not corrupt members of the Democratic leadership, the Republican minority party and certainly not La Raza or ACLU, US Chamber of Commerce, Council of Foreign Relations, Cato Institute, billionaire George Soros, Ford Foundation and a multitude of self interest groups. In health care the insurance companies have used their political currency, to weaken any prospect of a Canadian or European style public health care option. 2/3 of America insist on the single payer system like Canada and the European developed nations.

The rest of these despicable organizations want the free flow of cheap labor that is already swarming across our nation, even though we are in a deep recession and millions of US citizens and legal residence are jobless. As I speak 1.5 million new immigrants entered America and that’s not counting the illegal aliens who extract from taxpayers everyday. Our politicians can no longer demand of the people, to pay for foreign national health care, when they cannot afford it for their own families? How many more years are the people to be dictated to the power of profiteering insurance companies? How many decades must taxpayers is forced to pay for illegal immigrants and families, who have already broken our laws of sovereignty and expect to be rewarded with another blanket AMNESTY.

How can we assume our legislators to honor the “Rule of Law”, when they have already stone-walled us over the 1986 immigration enforcement law? Millions of loyal Americans who have already commanded E-Verify extraction tool in the workplace (section of the SAVE ACT) 287 G police enforcement, no match letter and the ICE raids of illegal immigrant. But we must maintain the bombardment if you want a health care public option choice? Whether you want to keep on supporting the impoverished, unschooled of foreign nations that skirt our laws? CALL YOUR SENATORS AND REPRESENTATIVES FOR WHAT YOU WANT AT 202-224-3121? NOT WHAT THE SPECIAL INTEREST LOBBY HAS PAID FOR? Read about the trillions to be spent on giving AMNESTY to illegal immigrants at the Heritage Foundation. GOOGLE more facts on the web, or search for the truth at NUMBERSUSA.

Observe this PETITION to STOP any health care to illegal immigrants at: http://www.thepetitionsite.com/1/nohealthcareforillegals

August 18, 2009 at 2:55 am
(3) Gawad Kalinga Foundation says:

PETITION to STOP any health care to illegal immigrants is supported by me. This law must be implemented.

January 11, 2011 at 4:32 pm
(4) Janelle says:

If we stopped health care to illegal immigrants, especially emergency health care… how do we prove they are illegal? What if I would nearly drown while swimming? The paramedics, showing up, would not find any ID on me and would not treat me until I could wake up on my own and produce my SSN… or else, they would treat me without knowing whether I was a legal citizen or not. Really. That’s dangerous territory.

February 6, 2011 at 1:21 pm
(5) Jennifer says:

I also do not see any societal value in trying to stop an immigrant from getting health care because of status. Do you really want epidemics like swine flu, avian flu, or others to spread simply so that you won’t feel like no-one is getting to see a doctor without first having the proper papers? Do you not realize that health is a public issue — everyone’s health affects everyone else’s health? Or for that matter, do you want an undocumented worker who’s looking after your children or your neighbor’s children, or doing work around your yard or your neighbor’s yard, to fall over from a heart attack in the middle of work because they can’t get checkups? Are you going to think about what kind of society you actually want to live in –or just operate on a self-centred impulse of not wanting anyone to get any access to services you resent them getting?

February 15, 2011 at 2:23 pm
(6) who me says:

do you want an undocumented worker who’s looking after your children or your neighbor’s children, or doing work around your yard or your neighbor’s yard, to fall over from a heart attack in the middle of work because they can’t get checkups?
well no I don’t But if there working for some ONE, that someOne need to provide INS for them..and not expect every one else to provide them INS. At the cost of every tax payer expense, As they do not work for me, I’m not their care taker.Nor do I not have Responsibility for them and nor should I be made be in any way..

July 1, 2011 at 2:03 pm
(7) Lamb Financial Group says:

If your non profit is looking to get an analysis of their current insurance plans in order to ge the best possible rates then go to LambfinancialGroup.com

March 8, 2012 at 6:46 am
(8) Santosh says:

I beg to differ with the author on the issue of coops not able to perform during what he calls ‘bad economic’ times. I work with the movement and failed to realise why it claims its collaborative reign for over a hundred years, through the great wars; even though there are in the corporate sector that have probably ruled countries, through Aggression and force! and it is after the corps that pose unhealthy competition in the world owing to which many a rules and codes have gone through a ‘sea’ change. Now I know why. Cuz coops are simple , natural and willing. because through the authors opinion , I have realised the consistency of coops with regard their principles and the novel idea of organised collaborative pecuniary effort making them a niche advanced society. A friend , in the states… cried ( on facebook) “why can’t we have more of these” … well… what can one say? many need voice up. turn the economic “whateverthefuckofasituation” into a coop Roar.. Back to the economy.

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