June 30, 2009 08:56 PM UTC

Health Care Co-Ops Are Not the Answer

• 0 Comments
• by: Progressive Promoter

( – promoted by Colorado Pols)

[disclaimer: I work on projects for the Colorado Consumer Health Initiative but am not a staffer]

While the idea of health cooperatives might be a tempting solution for liberals to grab onto, co-ops actually would endanger the current the health care reform effort by posing as a politically palatable–but ultimately meaningless–alternative to a public health insurance option.

As Paul Krugman, Nobel prize-winning economist and New York Times columnist wrote in the NYT:

For the record, neither regional health cooperatives nor state-level public plans, both of which have been proposed as alternatives [to the public option], would have the financial stability and bargaining power needed to bring down health care costs.

Jacob Hacker, author of Health Care for America and U.C. Berkeley political scientist offers this analysis in the New Republic:

[The co-op plan is]…not going to have the ability to be a cost-control backstop, much less a benchmark for private plans, because they are not going to have the reach or authority to implement innovative delivery and payment reforms.

And Robert Reich, former secretary of labor and professor at the University of California explains the problem in the WSJ:

…cooperatives would lack the scale and authority to negotiate lower rates with drug companies and other providers, collect wide data on outcomes, or effect major change in the system.

Co-ops are not going to get done the job of lowering costs even though they’re politically attractive. The last time healthcare reform was part of the agenda, the lobbying powers of the AMA, pharmaceutical industry, and others buried it so deeply we didn’t see it again for 15 years. Let’s not let the same thing happen again.