One key consumer-operated and oriented plan based in the Midwest recently lost the battle for hearts, minds and pocketbooks along the highly competitive landscape of an emerging online marketplace when it was forced to liquidate, but does that spell doom for other CO-OPs?

The answer depends on who you ask.

One commercial insurance industry maverick, for example, considers the failure of CoOportunity Health of Iowa and Nebraska an ominous sign for this nonprofit model, which was seeded with federal dollars under the Affordable Care Act. Aetna chairman and CEO Mark Bertolini described it as “a precedent kind of transaction” during a conference call to discuss the insurer’s fourth-quarter 2014 earnings, adding that CoOportunity “probably is not the first and also not the last of these co-ops to have issues.”

Also see: CO-OP breaks new ground on integrated model

Another critique was offered by Ken Fasola, president and CEO of HealthMarkets who once worked for Humana and UnitedHealthcare. He told Healthcare Payer News that CO-OPs will struggle to achieve critical mass with so few people enrolled and expressed reservations about their payment relationships with providers as well as operating scale.

Proponents of this nonprofit model, however, have sought to dispel any such speculation about its impending demise. Martin Hickey, M.D., who chairs the National Alliance of State Health CO-OPs and heads up the New Mexico Health Connections CO-OP, recently assured the group’s membership in writing that “CoOportunity’s situation was influenced by a number of unique and specific factors, and is not a reflection on the CO-OP program or concept.” He also pointed to buoyant enrollments for both the Maine Community Health Options and Kentucky Health Cooperative.

Also see: 8 must-haves for setting up a successful health care co-op

Bruce Shutan is a Los Angeles-based freelance writer.         

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