I've been puzzled by the intense progressive hatred of a health care cooperative.
Tonight (Thursday, September 3) I'm going to be a guest on KGNU community radio in Boulder, Colorado, "It's the Economy" show at 6-7pm mountain time discussing co-ops and my previous diary, In Defense of Co-ops. So I want to understand exactly why progressives are opposed to the co-op approach.
According to slinkerwink yesterday, "We all know that regional co-operatives don't even work as a cost containment in lowering premiums nationwide, and the only cost containment that can do that is the public option."
Really? How do we all know that?
Considering that there aren't any regional health insurance cooperatives, how do we know they can't compete? There are plenty of good co-ops in America and around the world that do compete in a variety of businesses.
And why do progressives think that regional co-ops are the only option? One of the options Kent Conrad offered to his Senate colleagues was a national co-op.
Why aren't progressives pushing to make this a reality?
Jacob Hacker claims (pdf) that co-ops can't meet his standards for benchmark, backstop, and backup. Hacker's wrong on all three measures because he assumes co-ops would be "small and scattered." Why would they? Why can't we have a national cooperative that would do everything a public plan can do, and maybe more?
Large consumer co-ops are very rare because of a lack of capital, not because they can't compete. Banks are unlikely to hand over piles of money to an enterprise that's not devoted to making a big profit, and without private financing, no large consumer co-op has ever been established in America. However, the federal government has the funding to make these start-up costs feasible for a co-op.
The only real value I can see in a public plan (but it's unlikely to be allowed in any public plan that can get enough votes) over a co-op is to coordinate with Medicare for setting providers. However, Hacker argues that linking providers with Medicare is a bad idea for any plan, so this would seem to remove the only advantage of a public plan. (I'm not sure why a cooperative couldn't be allowed to link providers with Medicare anyway.) As for setting rates, a cooperative can set the same rates as Medicare +5% (as the House bill proposed). You don't need a public plan to do that; the Medicare rates aren't a secret.
A co-op is a PUBLIC option. It's not a government option, but it is owned by the public. In fact, because it's owned by its members, it may be a better public than the government. With a government-run plan, you will always have the influence of politicians. That means lobbyists from private health insurance companies will help shape legislation, and politicians will always be seeking to appease the elderly, more conservative voting bloc. With a co-op, the members (who would tend to be the young and the working poor) would choose the coverage.
It is a certainty that under a public plan illegal immigrants would not be covered; under a co-op, there's no reason why they would be banned. It is a certainty that some reproductive health care (especially abortion) would be banned under the public plan; under a co-op, that should be up to the member-owners and their elected representatives to decide. Considering the serious limits on democracy in our money-dominated political system, a co-op will be more democratic, more public in that sense, than a public plan.
There's nothing wrong with drawing a line in the sand. Progressive politicians should be standing up for our values against a conservative onslaught of lies. The problem is that the public option is the wrong line. Progressives should call for a public plan OR cooperatives, and demand that either choice meet progressive standards for competing with private insurers.
The cooperative plan is an approach that can get votes in the Senate, provide competition, and offer a non-profit alternative to the corporate model of health insurance.
So what exactly are the progressive arguments and evidence against a national cooperative?
I encourage you to respond, and also to listen to the show tonight.
Crossposted at Obamapolitics.