Wisconsin farmers are pooling their purchasing power to enhance access to affordable coverage. Typically, farmers, farm workers, and their families are faced with limited and often unaffordable coverage options in the individual or small group insurance markets.
Made possible through a state law giving Wisconsin Federation of Cooperatives (WFC) the ability to form five health care cooperatives, the new health care purchasing co-ops will negotiate and contract with local insurers to establish health plans for their members. The first such plan is being implemented by WFC through a collaborate partnership between Group Health Cooperative of Eau Claire and AgStar Farm Credit Cooperative, which counts among its membership about 2,000 families involved in farming in 16 counties in the northwest area of the state. WFC is finalizing benefits and pricing, conducting focus groups, and expects to market the product in the summer of 2005.
A number of features are intended to make the WFC plan more affordable than existing options, including:
- Allowing those who are currently limited to purchasing individual health policies to buy into a group plan (the project's actuaries estimate a 15% savings from this, though rates will be lower for some individuals and higher for others);
- Building a significant amount of member education into the program and encouraging prevention and intervention (offering first-dollar coverage of preventive services, promoting disease management and workplace safety, and requiring members to undergo a health risk assessment as a condition of enrollment);
- Building an effective data tracking system that will allow the cooperative to identify cost containment measures, measure provider performance, and bolster member education and disease management programs;
- Utilizing elements of consumer-driven health care, such as educating members about costs and benefits of utilization, as well as encouraging use of generic medications and renegotiating provider fees;
- Ensuring a balanced risk pool by attracting and maintaining a stable membership through such rules as minimum participation requirements. WFC acknowledges that this is its biggest challenge. A FY 2005 federal budget appropriation of $2.23 million will help establish and administer a "stop loss fund" that will pay for some of the higher-cost claims incurred by cooperative members. This should help maintain stable premiums and avoid rate hikes that often lead to "death spirals," whereby lower-risk individuals leave the plan, raising premiums still further.
WFC plans to implement Co-op Care statewide over the next three years. According to Melissa Duffy, director of government relations at WFC, "Success will pave the way for expansion. At some point, the cooperative purchasing arrangements will open up to other co-ops, small businesses, municipalities, and really any group that wants to join."
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