According to this Financial Times report. Co-ops are a totally insufficient substitution for the less-than sufficient public option anyway, but this confirms suspicions that the Republicans were never serious about playing a constructive role in passing health care legislation (at least from the beginning of the summer on). The article rightly points out that a co-op scheme will require considerable funds for start-up costs if they are to hope to compete with their bloated competitors, something many Republicans are dead-set against (I wonder why), anyway. And what's to prevent them from demutualizing when/if things become more "normal" again?
US health co-op plan in doubt
By Saskia Scholtes in New York and Edward Luce in Washington
Financial Times
Published: August 24 2009 20:58 | Last updated: August 24 2009 20:58
A plan to establish more insurance co-operatives could need start-up capital of tens of billions of dollars, analysts say, presenting a potential stumbling block for the US healthcare reform proposal.
The scheme has been championed by some moderate Democrats as an alternative to proposals for a public option.
It would aim to increase competition among healthcare insurers and help reduce the country's spiralling healthcare costs through government support for not-for-profit insurance co-operatives, which would be owned by and managed for the benefit of their members.
However, analysts at Smart, a consulting firm, have said the co-ops would require tens of billions of dollars in start-up capital to pay for recruiting members, striking deals with medical providers and setting up administrative systems.
Current co-op proposals include start-up funds of about $6bn, 4.2bn euros, 3.7bn pounds).
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