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Vermont CO-OP organizers advance

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The organizers of the Vermont Health CO-OP have applied to the Vermont Department of Financial Regulation for the certificate the CO-OP would need to do business as an insurance company in the state.

Robert Simpson Jr., the CO-OP hearing officer, will hold a pre-hearing conference on the matter Nov. 26, officials said.

Simpson later will hold a public hearing on whether the CO-OP should be granted a license, and he will make recommendations about the matter to Steve Kimbell, the Vermont insurance commissioner, officials said.

The U.S. Department of Health and Human Services (HHS) announced in June that the Vermont CO-OP could be eligible to receive about $34 million in loans.

The drafters of the Patient Protection and Affordable Care Act of 2010 (PPACA) created a new type of nonprofit, member-owned health plan — a Consumer Operated and Oriented Plan (CO-OP) – in an effort to increase the level of competition in the health insurance market.

PPACA Section 1322 calls for CO-OPs plans to sell coverage through the new PPACA health insurance exchanges, or Web-based health insurance supermarkets, and to get “substantially all” of their business from individuals and small groups.  

CO-OP program rules prohibit for-profit health insurers from creating CO-OP plans or participating in CO-OP plan governance.

CO-OP supporters say the program could increase the level of competition in markets that now have just one or two major carriers. 

Program critics have questioned whether the CO-OP plans will have much effect on the health insurance industry, noting that existing cooperative health plans seem similar to other nonprofit plans.

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