Health insurance co-ops failed in Iowa

I wasn’t living in Iowa during the 1990s, so I had never heard about this episode before reading today’s New York Times:

Hopes for co-ops may also be tempered by the experience of Iowa, home to Senator Charles E. Grassley, the senior Republican on the Finance Committee, which is trying to hash out a bipartisan health care proposal.

In the 1990s, Iowa adopted a law to encourage the development of health care co-ops. One was created, and it died within two years. Although the law is still on the books, the state does not have a co-op now, said Susan E. Voss, the Iowa insurance commissioner.

Wellmark Blue Cross and Blue Shield collects about 70 percent of the premiums paid in the private insurance market in Iowa and South Dakota.

To become established, a new market entrant would have to offer lower prices or better services, Ms. Voss said, adding: “Wellmark has a huge advantage. They already have contracts with practically every doctor in the state.”

I am shocked, shocked to learn that senators hauling in huge money from the insurance industry want to scuttle plans for a public health insurance option in favor of cooperatives that would not provide any meaningful competition in the marketplace.

House and Senate Democrats need to stand firm against a fake public option. Contact your members of Congress, Stand With Dr. Dean or sign up with Health Care for America Now to advocate for a real public option.

  • School districts

    About 10 years ago, there was a group of southeast Iowa school districts who had banded together for health insurance, but their agreement fell apart.  I don’t know many of the details, but I wonder if this is the coop that was mentioned in the article.

    • I have no idea

      Maybe that was a co-op, or maybe they were just trying to band together for a regular group policy.

      Either way, it’s clear that if co-ops had any real potential to compete with insurance companies, we’d see some operating in Iowa.

  • Health insurance co-ops...

    …or co-opts? This rival to Big Insurance will be easily squelched at the state and regional levels by the aforementioned. Using a retail analogy, that would like trying to take on Wal-Mart with a retail co-op. Pleasssseeee, Congress and dems, in the immortal words of The Who: “Don’t be fooed again…”

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