Among 23 health insurance co-ops, Maine stands out for its success

When drafting the Affordable Care Act in 2010, Congress wanted to foster competition among health insurers. So it offered loans to nonprofit organizations that wanted to start health insurance consumer oriented and operated plans(called co-ops) in the states.

In theory, the co-ops are a great idea to increase competition and consumer choice. Congress included $2.4 billion in the ACA to establish these member-operated health insurance plans. The co-ops are particularly important today because five of the largest health insurers could soon be reduced to three if Anthem acquires Cigna and Aetna merges with Humana.

In practice, however, co-ops have struggled. Only a co-op in Maine, Community Health Options, has turned a profit. What’s the secret to CHO’s success? There are several.

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