Question Answered: What is a Health Care Co-op?

Before you nod off at the very thought of "co-ops" and health care reform, let's discuss why you better know what we're talking about: Because you, yes you, might be joining a health care co-op, and writing that co-op a check every month, in the relatively near future.

You've already heard about the "public option" from PD's Jill Lawrence. That would be a government-run insurance program for people who can't afford, or don't want, private insurance.

That idea has hit a serious roadblock in the Senate, where every Republican and several Democrats have said they won't support it. They complain a public option would be too expensive, too big, and too close to a slippery slope toward government-run health care. In short, the public option isn't going anywhere in the Senate.

Knowing that, the Finance Committee Chairman, Max Baucus (D-Mont.), asked Sen. Kent Conrad (D-N.D.) to come up with a plan that would satisfy the Democrats' goals on health care reform, but could still win Republican votes by keeping costs down and steering clear of government-run anything.

Conrad's proposal: A co-op.

Don't know what a co-op is? Maybe you do. If you browse REI or True Value hardware stores, you shop at a co-op. If you have Ocean Spray or Land O'Lakes in your fridge, you're buying from a co-op. If you do your banking at a credit union, you belong to a co-op. If you read newspapers with Associated Press content, you're supporting a co-op.

But how would a health care co-op work?

A document circulated to the Finance Committee explains that a co-op would be a non-profit health care company, owned and run by consumers who buy shares in it and elect its leaders. The proposal also says:

* There are no free rides in co-ops. Every person would have to pay dues, whether they have the money on their own or they get a government subsidy (which would have to be worked out). Costs are not spread among paying and non-paying members.

* The feds could pay the start-up costs for a co-op, but could not pay to sustain it.

* Co-ops could be different sizes -- local, regional, or national. NYC might have several, while parts of North and South Dakota could team up to offer one.

* Every state would be required to have at least one co-op option.

Wonder what a co-op looks like in the real world? No need to guess. Consider the Puget Sound Group Health, a co-op in Washington state that Conrad has offered as an example of how a good co-op works.

As a member of Puget Sound, you choose between a catastrophic plan, an HMO, PPOs, or a physician network. You can enroll either on your own, through Medicare, or through your employer.

The cost for a mid-30s single, self-employed woman runs from $78 per month for a catastrophic plan to $277 per month for full coverage, with big swings in deductibles and cost sharing. A family of four, with no employer support, would pay $244 per month to $862 per month. You can compare that to your own insurance options to see how that stacks up.

There's no guarantee co-ops will be part of health care reform. But, because they are the central element of the compromise plan right now, it's a question we wanted to answer.