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What co-ops and Seinfeld have in common
Conrad's health care public co-op is a Seinfeld episode — it's about nothing
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WASHINGTON - North Dakota’s Kent Conrad, the moderate, unassuming Senate Finance Committee member and Budget Committee chairman, is in the spotlight these days.
As Budget chair, his approval is necessary to split health care reform legislation into two and attach it to the budget reconciliation process, a process which requires 51 votes instead of the normal 60 total under Senate debate rules.
On Sunday, Conrad gave thumbs down to that.
He’s also the point person for ‘public co-ops’ as a means to provide health insurance access to roughly ten million Americans, mostly the working poor. Conrad cites Ocean Spray (cranberries), Ace Hardware (um, hardware) and Land O’Lakes (dairy) as successful models of non-profit cooperatives, although each is organized as a seller of a commodity and not a purchaser of a service such as health care.
One successful public cooperative in the country is Group Health Cooperative of Puget Sound, the third largest health insurance firm in Washington State; it has a 9 percent market share, with roughly 500,000 enrollees. Another is Health Partners in Minnesota, the state’s second largest carrier, with 657,000 enrollees. That’s pretty much it.
Nevertheless, Conrad’s convinced consumers can do a better job compared to bureaucrats (but of course only with considerable technical assistance from bureaucrats to set up vastly complex networked computer systems, and with $6 billion from taxpayers for market capitalization and administrative overhead).
The idea of a buyers’ cooperative for health care is not new. Indeed, it was the operational centerpiece of the doomed 1993 Clinton health care proposal, labeled health insurance purchasing cooperatives, or HIPCs, and warmly embraced by moderates in Congress and business-backed think tanks.
Sixteen years later, congressional moderates are scrambling again to find an alternative which can’t be labeled as a big government solution.
Somewhere, the king of consumer co-ops, Ralph Nader, must be smiling, or at least smirking. Nader’s “Buyer’s Up” co-op for home energy first found footing in the mid-1980’s. (Too bad it quietly went belly-up in 2006.)
Conrad’s proposal would have employees from companies with 10 or fewer workers banding together as a non-profit group to purchase health care coverage from hospitals, doctors, medical device makers and drug firms, thus generating sufficient market power to guarantee lower prices and quality care.
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That’s simple enough to get heads to nod at the next town meeting.
Conrad first floated his alternative in mid-June, where it was embedded in a leaked copy of a Finance Committee Democrats’ working draft. By the next day it had vanished.
Democratic progressives have since made the stability, permanence, portability and simplicity of the ‘public option’ their own Waterloo, and have brought it back to life when it looked dead before.
Sometimes, though, you can be for something simply by knowing who’s against it. Health insurance companies seemingly object to the ‘public co-op’ too. So do Rush Limbaugh, Glenn Beck, and Sean Hannity. All together now, can you say “Washington takeover of health care.”
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