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    Better rates and website improvements could boost CO-OP enrollment

    Considering the challenges they faced during the first Affordable Care Act (ACA) health insurance marketplace open enrollment period, Consumer Operated and Oriented Plans (CO-OPs) overall are doing “very well,” according to Janice VanRiper, JD, PhD, executive director and chief executive officer of the National Alliance of State Health CO-OPs (NASHCO).

    The new consumer-directed, not-for-profit health plans have signed up some 450,000 members across the nation--less than the 575,000 originally forecast for their first year, but still representing 18% of all ACA exchange plan enrollees to date. While NASHCO has not established a national enrollment target for the next ACA open enrollment period, which begins Nov. 15, CO-OP organizers are cautiously optimistic.

    Under-performance among CO-OPs during the last enrollment period is generally attributed to several factors, VanRiper said. CO-OPs rely heavily on Healthcare.gov and state insurance exchange websites--which were famously subject to technical problems last year--as an enrollment mechanism. Enrollment through the websites is generally expected to be much improved this year, VanRiper notes.

    Although the nonprofit CO-OPs were developed in part to help ensure the availability of low-cost health plans on the exchanges, lacking sufficient actuarial data, many of them set premium rates above those of competing commercial plans. This year, with better data in hand, most CO-OPs are either cutting premiums or not raising them as much as competing commercial plans, meaning they should be attractive to consumers during the upcoming enrollment period, VanRiper says.

    In addition, the Obama administration’s decision to allow anyone with insurance to keep their existing plans reduced the market for all new entrants in the health insurance market, including CO-OPs, VanRiper notes.

    Co-op chart

    CO-OP plans face “the challenges of any new product entering the insurance market,” VanRiper says. Many consumers may not be familiar with the concept of an insurance CO-OP or its potential advantages for enrollees. Federal law prohibits the use of federal CO-OP funding for marketing, although some CO-OPs have raised additional capital with which to undertake advertising or marketing.  

    Despite challenges, all 23 of the CO-OPs that offered health plans on exchanges last year will be back for 2015 and some are even expanding. The Montana Health CO-OP will offer coverage in Idaho. The Kentucky Health Cooperative will start selling plans in West Virginia. Minuteman Health of Massachusetts and Maine Community Health Options both are expanding into New Hampshire. InHealth Mutual will enter Ohio’s health insurance marketplace in 2015 after selling off-marketplace plans during 2014.

    Because last year’s “fiscal cliff” budget agreement cut off federal CO-OP start-up funding, no new CO-OPs will be entering the market this year. However, no CO-OPs are dropping out of the market, VanRiper says.

    Bob Pieper
    Bob Pieper is a freelance health care writer based in St. Louis. He is the former senior editor for AOA News.

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