July 21--As one of only two employees of the fledgling Montana Health Cooperative, CEO Jerry Dworak said Friday its staff won't get a whole lot bigger -- and that's one way the co-op will keep health insurance costs low for its future customers.
"We're really going to streamline everything to make sure our administrative cost is the lowest in the state, one of the lowest in the whole industry," said Dworak.
Dworak, former chief marketing officer for Blue Cross of Idaho, became CEO of the government-financed cooperative this month.
The Montana co-op, which has a $58 million loan from the federal government to get off the ground, is a new nonprofit health insurer that plans to offer policies to consumers starting in 2014.
It's being funded by the Affordable Care Act (ACA), the sweeping health care reform law passed by Congress and signed into law in 2010 by President Barack Obama.
Co-ops, which are being developed in 17 states, will be member-owned health insurers that are supposed to offer an alternative to existing insurers already on the market.
They'll launch their product in 2014, coinciding with the launch of health insurance exchanges, which are state-based Internet marketplaces for insurance.
Of course, Republicans have vowed to repeal the ACA if they take control of Congress and the presidency this November.
Dworak said Friday he can't worry about that possibility, and that the co-op is moving ahead, assuming it will still be around next year.
"If I worried about all of the contingencies that would happen, I couldn't get anything done," he said.
Dworak and a chief internal officer are the only current employees of the co-op, which is governed by a board that includes a physician, insurance and benefits managers and executives, health care and retired health care executives and a labor leader.
Dworak said the co-op probably won't have more than 25 employees when it's fully up and running, preferring to contract out much of its administrative services, like processing claims.
Instead, the co-op will concentrate on creating a health insurance product that is unique and affordable, he said.
For example, the co-op wants to make it possible for its members to have better access to primary care, possibly through low-cost clinics, Dworak said.
The co-op hopes to have 10,000 customers within its first year and 40,000 by its third year, enabling it to be financially viable, he said.
Dworak believes the co-ops' customer pool in Montana could be as many as 330,000 people: Those without any health insurance, those buying insurance on the individual market and those working for small businesses that may drop coverage in 2014 when federal subsidies become available for individuals.
"If we get 10 percent of that (pool), we'd be able to exceed our (goals)," he said.
Not everyone is enamored of the co-op idea.
This week, the House appropriations subcommittee chaired by Rep. Denny Rehberg, R-Mont., passed a bill that, among other things, would rescind $3 billion meant to fund new cooperatives.
However, Rehberg spokesman Jed Link said Friday the rescission would affect only future appropriations, and not co-op funds already committed, such as for Montana's co-op.
Rehberg and other Republican members of Congress have questioned whether money spent on the co-ops will end up being wasted, because the co-ops won't pan out.
(c)2012 Independent Record (Helena, Mont.)
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