Kentucky Health Cooperative, a new kind of insurer, claims most of the business on the state insurance exchange
The Kentucky Health Cooperative, a non-profit, consumer-governed health plan,
The co-op competes on Louisville-based Humana’s home turf and came out ahead of the insurance company that has $41 billion in annual revenues, CEO Janie Miller reminded Jay Hancock of Kaiser Health News as she told him how the co-op had beaten Humana and Anthem.
Unlike Humana, Anthem is offering exchange policies statewide — but through a relatively narrow network of health-care providers, which may discourage enrollment. Anthem has sold 13 percent of exchange policies, and Humana is close behind at 12 percent despite not selling statewide.
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| Janie Miller (AP photo) |
“They have a few more employees than I do,” Miller said of Humana. “We believe we’re the health insurance plan of the people.” Hancock interviewed the former state Cabinet for Health and Family Services secretary at the recent National Alliance of State Health Co-ops meeting in Washington, D.C.
The Kentucky co-op is planning to expand into West Virginia next year. The co-op in Maine did even better than Kentucky, getting 80 percent of the exchange market in competition with Anthem, Hancock reports.
John Morrison, former president of the co-op alliance, estimated that co-ops have between 15 and 20 percent of the national enrollment through exchanges, Hancock reports. Open enrollment for 2014 ends March 31.
Morrison also told Hancock that co-ops will save billions for the consumers and taxpayers paying for insurance because of the added competition and lower prices. Premiums are 8.5 percent lower on average in states with co-ops than in states without them. He acknowledged that cause and effect hasn’t been proven, but said “Nobody’s offered another explanation for why that might be true.”
The 23 co-ops were created under federal health reform as non-profit, consumer-governed health plans. They must use any extra revenue to lower premiums and improve benefits, or refund the federal loans that funded them. They are designed to give for-profit companies more competition and hold down rates.
The co-ops have signed up nearly 300,000 members this year and two others are set to expand into new states next year, Montana Health Co-op to Idaho and Minuteman Health in Massachusetts to New Hampshire, officials said at the Washington meeting.
The reform law prohibits co-ops from using federal funds for marketing and advertising, but still requires them to do education and outreach. This creates “big challenge as they try to build their businesses from the ground up while expanding access to care and caring for the chronically ill, Hancock reports.