Health insurance co-ops offer an alternative to exchanges

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Health insurance co-ops are receiving little attention despite the benefits they offer

Health insurance exchanges are receiving a great deal of attention throughout the U.S., but these marketplaces are not the only way for consumers to obtain coverage. Health insurance co-ops are another option that could offer coverage to consumers looking for affordable policies. These co-ops are generally non-profit organizations that are managed by their members, offering more consumer-oriented insurance plans than their counterparts in the private market. These co-ops have received relatively little attention when compared to exchanges.

Co-ops aim to create more competition in the insurance market

Health insurance co-ops were formed in many states as part of the Affordable Care Act. While states were required to build insurance exchanges, some opted instead to develop co-op systems, allowing the federal government to take responsibility for their exchanges. These co-ops are meant to create more competition in the insurance market. More competition is expected to drive down the costs of insurance coverage as a whole and give consumers more options when it comes to obtaining the policies they need.

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health insurance optionsStates opt for co-ops instead of exchanges

Co-ops exist in most states. The Health Republic Insurance of New York, for instance, provides health insurancenr68kpthnl6B8D87GB687E9D8AA coverage to those seeking an alternative to the state’s insurance exchange. Similar organizations exist in Washington, Minnesota, and elsewhere. Co-ops are required to offer similar policies to those sold through exchange systems and each policy must provide coverage for the 10 essential health benefits as defined by the federal government. Policies sold through co-ops follow the same tiered structure of state-based exchange systems, with plans being sold in platinum, gold, silver, and bronze categories.

Member-controlled organizations may offer better benefits to consumers

Co-ops offer an alternative to other insurance markets that consumers may not be interested in. These organizations typically support their own network of physicians in the same way that typical health insurance providers do. As member-controlled entities, however, co-ops are somewhat more flexible when it comes to the services they provide to consumers and members have strong influence over how these services change over time.

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