SOURCE: National Cooperative Business Association

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January 13, 2011 10:00 ET

Americans Would Benefit From Cooperative Health Insurance, Says NCBA CEO Paul Hazen

"Cooperatives Give Consumers a 'Hand Up' Not a Hand Out," Says Hazen

WASHINGTON, DC--(Marketwire - January 13, 2011) - Calling cooperative enterprise the "best business model for economic and social progress," the CEO of the National Cooperative Business Association Paul Hazen recommended today that the U.S. Department of Health and Human Services ensure that health insurance issuers created through the "Consumer Owned and Oriented Plans" (CO-OP) act as cooperatives. Hazen delivered NCBA's recommendations during testimony before the CO-OP Advisory Board which met today to begin the work of implementing the program, part of the Patient Protection and Affordable Care Act that was signed into law in 2010. 

Invited to testify for his expertise on the cooperative business model, Hazen discussed the value cooperatives bring to their members and challenges that threaten their success. "Cooperatives are member-owned and democratically controlled enterprises that provide services or products to their members," Hazen said. "Cooperatives deliver value to members and their communities because they respond to needs and through their commitment to cooperative principles and values. By operating at cost and returning the savings to members, cooperatives are the most effective corporate structure to address economic and social needs," he continued. Among the threats to the success of developing cooperatives is access to capital.

"Principles and practices matter," said Hazen, emphasizing that cooperatives operate under a set of seven established principles, including that members own and control the cooperative, that members receive benefit from their economic participation and that cooperatives demonstrate a concern for community. 

The CO-OP program calls for the creation of nonprofit health insurance issuers which would be consumer-run organizations -- although not specifically cooperatives. NCBA advocates that consumer-run and controlled entities that operate as cooperatives would be in the best interest of the American public. Hazen cautioned that the creation of doctor or provider-owned or run entities would be in direct violation of the Act.

In 2009, NCBA entered the national debate on health care, advocating for the creation of health care cooperatives, which would be owned by their consumer members. The Affordable Care Act includes funding for "Consumer Owned and Oriented Plans" but does not mandate the creation of cooperatives, despite the acronym of the program. NCBA is concerned about the blurring of the definition of co-ops created by use of the "CO-OP" name and welcomes this opportunity to protect the cooperative brand and ensure that entities organized under CO-OP operate as cooperatives.

Mr. Hazen's written testimony is available online at NCBA's website at www.ncba.coop.

ABOUT NCBA
Headquartered in Washington, the National Cooperative Business Association creates cooperative connections across all sectors of the nation's more than 29,000 cooperative businesses, including agriculture, food distribution and retailing, childcare, credit unions, purchasing, worker-owned, housing, healthcare, energy, and telecommunications cooperatives. The CLUSA International Program has helped develop cooperatives and other sustainable businesses in over 100 countries since 1953. CLUSA currently implements 23 projects in 10 countries. To learn more about NCBA, visit www.ncba.coop.

Contact Information

  • CONTACT:
    Andrea Cumpston
    202-383-5447
    acumpston "at" ncba.coop