The federal Patient Protection and Affordable Care Act was intended to extend health insurance coverage to 32 million of the roughly 50 million Americans who currently lack it. Yet even after the law fully goes into effect in 2014, millions of Americans will still be hard-pressed to pay the premiums charged by traditional for-profit health insurance companies. If they are to benefit from the law, many of them will have to seek lower-cost alternatives to the for-profit insurers.
Plans for new kinds of nonprofit health cooperatives, which provide members equivalent care at lower cost, are already on the drawing boards in about two dozen states, including Maryland, which recently received a $65 million federal loan to fund the establishment of the state's first non-profit health cooperative. The venture, to be known as the Evergreen Health Cooperative Inc., is the brainchild of a group led by Howard County Health Officer Peter Beilenson, and its mission will be to serve tens of thousands of Marylanders whose incomes are too high to qualify for Medicaid but who can't afford the monthly premiums charged by private insurers.
The Evergreen cooperative, which will be open to anyone in the state, was designed to provide care to members who pay premiums 20 percent to 30 percent less than those charged by traditional insurance companies. Under the current law, a family of four living on an income of $60,000 would pay nearly $6,000 in annual health insurance premiums, or a penalty of about $2,100 if they didn't buy insurance. But if they joined a nonprofit cooperative such as Evergreen, their annual premium would drop to about $4,000.
The cost reductions are made possible by an innovative business model developed by Dr. Beilenson and his collaborators. The model replaces the fee-for-service payment model for physicians with salaried doctors, and it emphasizes preventive care to keep people from developing serious illnesses. Finally, it employs only evidence-based procedures and therapies that have been proven effective.
The cooperative will consist of clusters of neighborhood clinics where patients would get most of their care from a salaried primary care doctor. In addition to the primary care doctor, each clinic would also employ a nurse practitioner, a health coach, a social worker, care coordinator and a receptionist.
Each cluster of clinics will be linked to a specialist center where experts in particular illnesses — diabetes, heart disease, etc. — can examine patients either in person or remotely through teleconferencing technology.
Since the primary care physicians and specialists will be salaried employee, they will have no financial incentive to perform unnecessary procedures and tests. That frees the physicians to spend more time examining the patients and coordinating their care with the health coach, social worker and nurse practitioner.
This so-called "teamlet" model of heath care delivery is the most original aspect of the Evergreen plan and the one most likely to achieve significant cost reductions. The cooperative will also offer a network of providers similar to those offered by for-profit insurers, but the premiums for those services will be somewhat higher. Nevertheless, when coupled with the federal health care reform act, the concept of health cooperatives could make quality care available to thousands more families among the 750,000 Marylanders who currently lack coverage. That could make the Evergreen cooperative a model of excellence not only for Maryland but the nation.