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A public plan or a Co-op: What’s it all about?

New insurance options: Learn about the proposed public plan (why we need one), the proposed alternative "healthcare co-ops, and how they compare side by side.

Public plan or Co-ops: what’s it all about?

One reason for our expensive healthcare system is we do not have well-functioning, competitive health insurance markets. Many of our local markets are dominated by one or two large insurers who can raise premiums at will and whose customer service record is poor. As one component in a comprehensive package of reforms, Congress is looking at adding a new type of health insurance competitor to reduce healthcare cost growth and improving the quality of health plans.

A public plan: Why we need one
The “public insurance plan” is a proposal for a health insurance plan, operated by the Federal Government but paid for out of premiums (not taxpayers). This plan would operate side-by-side with private insurers and the resulting competition should improve prices and services for consumers, whether they are enrolled in the public or the private options.
Read our full study.

Healthcare Co-ops: What’s it all about?
Based on the experience of healthcare co-ops to date, as well as the general difficulty of successfully entering today’s health insurance markets, we find it unlikely that many state-based co-ops will form and endure, even with the proposed federal start up assistance. Read our full study.

Public Plan vs. Co-ops: Which is Better for Consumers?
Consumers Union believes a public plan option is critical for reducing premiums and overall costs and improving the quality of services for all Americans, including those who enroll in other types of insurance plans. When market conditions indicate, healthcare co-ops could form as well, but the co-ops, by themselves are unlikely to provide the strong, viable competitor that consumers need. Read our full study.