Having Congress charter a health insurance “cooperative” is just another way of creating a new government‐run program that would drive private insurers out of business.
The definition of a cooperative is a health plan governed by its enrollees. Since a government chartered co‐op won’t have any enrollees at first, it will be governed like any other government program. So when the Obama administration and congressional Democrats say, “We’re going to create a co‐op,” what they mean is, “We’re going to create a new government health program but we will turn it over to the members in five years. We promise.”
As I explained in a recent Cato study, a government‐chartered co‐op would become just another Fannie Med:
It makes no difference whether a new program adopts a “co‐operative” model or any other. The government possesses so many tools for subsidizing its own program and increasing costs for private insurers—and has such a long history of subsidizing and protecting favored enterprises—that unfair advantages are inevitable.
Who was it that said that thing about putting lipstick on a pig?