CO-OP Health Plans Struggle to Overcome Built-In Barriers to Competition

eAlert 0a69e282-2a84-44b5-a5ed-59fcb977c593

The Affordable Care Act created the Consumer Operated and Oriented Plan (CO-OP) Program to give consumers the option to choose a nonprofit insurer with a strong consumer focus. But of the 23 CO-OPs launched, all but two have fallen short of enrollment or profitability projections, and 12 have, or soon will, shut down.

A new Commonwealth Fund report by Georgetown University’s Sabrina Corlette and colleagues examines the many challenges CO-OPs contend with and the ways in which these insurers have responded. The researchers focus on the experiences of six CO-OPs located in Iowa/Nebraska, Kentucky, Maine, Maryland, Montana, and Tennessee.

Some of the obstacles CO-OPs have faced are the same ones that confront any new insurer looking to enter the market. Others, however, stem directly from policy decisions that have made it harder for CO-OPs to compete effectively with for-profit companies. Read the report