Nonprofit health care group launches in east Wis.

By DINESH RAMDE, Associated Press
Associated Press

MILWAUKEE (AP) — Residents in eastern Wisconsin soon will be able to buy health insurance through a nonprofit cooperative that claims to offer lower-cost insurance options because it will re-invest its profits back into the company.

Common Ground Healthcare Cooperative, which is selling plans through the online federal exchanges, has signed up more than 2,200 people for coverage to begin Jan. 1, CEO Bob De Vita said Wednesday. Nearly half the enrollees signed up in the last week, he added, suggesting that the cooperative is gaining momentum.

Wisconsin already has several health care cooperatives. Group Health Cooperative of South Central Wisconsin began in 1976 and has about 70,000 members in the Dane County area, while Group Health Cooperative of Eau Claire, which started about 30 years ago, serves about 75,000 members in western Wisconsin.

Common Ground plans to serve customers in 19 eastern Wisconsin counties from the Illinois border up to Marinette County. The cooperative partners with Aurora Health Care and Trilogy Health Networks for medical care.

De Vita described Common Ground as the equivalent of a credit union for health care, where profits are returned to the company to keep costs down. The company plans to serve nonprofits and businesses with fewer than 50 employees, as well as individuals such as entrepreneurs, freelancers and contractors.

"We were put together by small-business people, community leaders and ordinary citizens who saw the need for affordable health insurance for that segment of market that wasn't being well-served," he said.

Most of the 2,200 people who have signed up so far are individuals, he said. However, he said it was too early to provide a breakdown of the enrollees' demographics.

About 75 to 80 percent of the enrollees signed up through the federal exchange, De Vita said.

Common Ground received nearly $57 million last year from the federal Centers for Medicare & Medicaid Services. De Vita said he was pleased with the pace of enrollments and believes the company will meet its goal of 10,000 enrollees by the end of next year.

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He also predicted that by the following year, Common Ground would reach the 15,000 to 20,000 members it needs to at least break even.

He attributed his confidence in part to the popularity of other industry cooperatives in Wisconsin and also to fact that no carrier in Wisconsin has more than 30 percent market share.

"In some other states, one carrier has 80 percent market share. In the state of Wisconsin there's not one dominant carrier," he said.

While De Vita touted his cooperative's prices, he acknowledged it can be like "comparing apples to tin cans" trying to pick plans because of variability in coverage, deductibles and so on.

Phil Dougherty, an executive with the Wisconsin Association of Health Plans, agreed. He also noted that a cooperative's prices won't necessarily be lower just because it's not-for-profit.

"That's just one factor," he said. He cited other cost factors, including the insurer's cost efficiency, the quality of its health plans, the benefits and services offered and the demographics of the individuals covered. "There are a lot of moving parts. You have to take everything into account."

Dinesh Ramde can be reached at [email protected].

Copyright:Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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