King focused exclusively on proponents of health care co-ops

King's report focused solely on co-op supporters. In a report on a Wisconsin farmers' medical cooperative, King highlighted dairy famer Bob Topel's belief that this co-op “should be a model as Washington looks for a way to force private insurance companies to compete more for their business.” King added that “co-op fans say their way makes more sense than a new government-run health insurance option” and interviewed the farmers' cooperative president, who claimed that co-ops lead to “very, very high quality” health care at a cost equal to or less than what their members were paying prior to joining. While King noted that “critics suggest what works in rural areas or small cities might not fit in more diverse suburbs or in urban America,” King added that Topel was “just as skeptical that government has the answer.”

King ignored progressive criticism of replacing public plan with health care co-ops

Robert Reich: Co-ops are a “bamboozle” that “won't have any real bargaining leverage.” Former Clinton Labor Secretary Robert Reich described Sen. Kent Conrad's (D-ND) reported cooperative health insurance proposal as a “bamboozle” and said that "[n]onprofit health-care cooperatives won't have any real bargaining leverage to get lower prices because they'll be too small and too numerous. Pharma and Insurance know they can roll them. That's why the Conrad compromise is getting a good reception from across the aisle." [The American Prospect, 6/11/09]

Krugman: The “supposed alternative, nonprofit co-ops, is a sham.” In his August 20 New York Times column, Nobel Prize-winning economist Paul Krugman wrote: “And let's be clear: the supposed alternative, nonprofit co-ops, is a sham. That's not just my opinion; it's what the market says: stocks of health insurance companies soared on news that the Gang of Six senators trying to negotiate a bipartisan approach to health reform were dropping the public plan. Clearly, investors believe that co-ops would offer little real competition to private insurers.” [New York Times, 8/20/09]

Jacob Hacker: Co-ops are “not going to have the ability to be a cost-control backstop.” In a June 14 post to The New Republic's blog The Treatment, University of California-Berkeley professor Jacob Hacker argued that Conrad “has offered no reason to think that the cooperatives he envisions could do any of the crucial things that a competing public plan must do.” Hacker continued:

An easy way to think of the public plan's functions is the three “B”s: We need a national public plan that is available on similar terms in all parts of the nation as a backup. This plan has to have the ability to improve the quality and efficiency of care to act as a benchmark for private insurance. And it has to be able to challenge provider consolidation that has driven up prices to serve as a cost-control backstop.

Cooperatives might be able to provide some backup in some parts of the nation, but they are not going to have the ability to be a cost-control backstop, much less a benchmark for private plans, because they are not going to have the reach or authority to implement innovative delivery and payment reforms. And so Conrad's idea appears to be yet another compromised compromise that cuts the heart out the idea of public plan choice on the alter of political expediency.

[...]

[A] national cooperative would still fall so dramatically short of a public plan that it would only be attractive in addition to a national public plan, not as a substitute for it. Indeed, this point holds more generally. Given the need for countervailing power in the health care market, the federal government should encourage a range of consumer-oriented health plans and state-based public plan options, so long as there is also a national public plan capable of being a backup, benchmark, and backstop. [The New Republic, 8/14/09]

Media have repeatedly ignored position that health care will be ineffective without public option

Media have repeatedly characterized co-ops as an “alternative” to a public insurance option while ignoring progressive arguments on necessity of public option. As Media Matters has documented, several media figures and outlets -- including MSNBC's Andrea Mitchell, Fox Business' David Asman, USA Today, MSNBC's David Shuster, MSNBC's Savannah Guthrie, the Associated Press, the Los Angeles Times, The Wall Street Journal, CNN's Wolf Blitzer, The New York Times, and CNN's Heidi Collins -- have previously ignored the position of progressive experts that a public plan is necessary for successful reform.

Transcript

From the September 7 edition of CNN Newsroom:

COLLINS: The battle over health care reform -- the debate lurches back into gear this week, as vacationing lawmakers return to Capitol Hill. One of the options they'll consider is creating a health care cooperative. What would that mean? Chief national correspondent John King has some lessons from the heartland.

[begin video clip]

KING: Two hundred and eighty cows here. Each eats about a hundred pounds of feed a day. Three milking cycles, not to mention tending to the corn and other crops. A family farm is a long, hard day's work. With milk prices down, a profit is hard to come by, which makes Bob Topel all the more grateful for his invisible partner.

BOB TOPEL (Wisconsin dairy farmer): Seed, fuel, fertilizer, feed -- everything we buy is pretty much through a cooperative. We market our milk through a cooperative. If there is any profit made, the profit returns to the owner, so the more you use the cooperative, the more earnings you get back. Co-ops have been around for over a hundred years in agriculture.

KING: And for the past 10 months, Topel has turned to the co-op approach for something far more personal, his health care -- joining a two-and-half-year-old farmers' cooperative he says should be a model as Washington looks for a way to force private insurance companies to compete more for their business.

TOPEL: There's a lot of farmers who had individual health insurance elsewhere came to us and saw their premiums go down. And the other benefit we saw was there was farmers who didn't come to Farmers' Health, but by putting an extra layer of competition in the marketplace, their premiums went down just to meet what the Farmers' Health is putting out.

KING: Competition and choice are the main goals, and co-op fans say their way makes more sense than a new government-run health insurance option.

BILL OEMICHEN (president and CEO, Cooperative Network): Eighty-five percent of the members of the Farmer's Health Cooperative, for example, reported to us either their premiums fell or they stayed somewhat similar to what they had before.

But as importantly, 65 percent of them said their health benefits actually increased substantially over what they had before. So where co-ops are they tend to be very, very high quality, because it is the consumer who owns them, is making sure that their health care provider is a quality health care provider.

KING: In addition to expanding choice and competition, Bill Oemichen of the Cooperative Network says the plans are helping with another big problem.

DEMICHEN: About 12 percent of our members were previously uninsured. And so we think we've had a real impact on bringing in producers who previously couldn't get access to health insurance.

KING: Wisconsin has a dozen health care co-ops in all. Some hire doctors directly.

UNIDENTIFIED MALE: You took X-rays today.

KING: Others used their pooled purchasing power to negotiate better rates with private insurers. Plans are widely accepted across the state, including this clinic in Monroe.

UNIDENTIFIED MALE: No numbness or tingling?

KING: Bob Topel knows critics suggest what works in rural areas or small cities might not fit in more diverse suburbs or in urban America, but he's just as skeptical that government has the answer.

TOPEL: To me, just looking at the way the government managed the clunkers program and managed FEMA and Katrina and all of those things, I just -- I don't want to turn my health care over to a government agency and try to get my round peg in a square hole, and if it doesn't fit I'm caught in some bureaucratic red tape. With the co-op system, I know the people that I can call and they're going to take care of me because I'm an owner versus just a number.

KING: John King, CNN, Waterloo, Wisconsin.

[end video clip]