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Utah's first co-op health plan provider cleared by state

By Paul Nelson | Posted - Mar 26th, 2013 @ 8:17am



SALT LAKE CITY — As the health care field continues to change, the state has given its approval to a new health care company that plans to bring innovative coverage to Utah.

Arches Health Care was one of many organizations across the country that received federal loans in 2012 to establish a CO-OP, or a Consumer Operated and Oriented Health Plan. With its $85 million loan, the organization will focus on offering direct partnership between physicians and their patients, according to the website.

"The co-op is different in that it is going to be member-owned," said Linn Baker, Arches Health Plan CEO. "In fact, the board of directors will have to be elected by the members in 2015."

Co-op programs are one of many new programs coming to the health care field since the Affordable Care Act was passed. They'll be closely monitored, but the government hopes it brings a new type of coverage to the table.

What is a CO-OP?

A CO-OP is a new type of nonprofit health insurer that is directed by its customers, uses profits for customers' benefit, and is designed to offer individuals and small businesses affordable, customer-friendly, and high-quality health insurance options.

Source: CCIIO.cms.gov

"(They) will foster the creation of qualified non-profit health insurance issuers to offer competitive health plans in the individual and small group markets," according to the Center for Consumer Information and Insurance Oversight website.

Baker said the organization hopes to move away from the traditional method of reimbursement, adding that insurance companies pay more to doctors and hospitals based on how many tests or procedures they order.

"Our mission is to move away from ‘fee for service' (models) and start reimbursing based on value, not volume," Baker said.

He said their approach will be more of a "medical home" model, where the primary care physician leads a team of health care workers to determine the best course of treatment. The plan also touts a cost-transparency model, meaning costs for services fixed are given up front.

"Primary care physicians will be able to make more money by ensuring that they're giving the care that specialists often give and shouldn't be giving," Baker said.

This service will be provided through the Utah Health Exchange. People can sign up for it in October and it will go into effect in January, so company officials are trying to educate as many people about it as possible.

"We're going to the small employer and explaining to them how the exchange works and how they can, in effect, send their employees to the exchange," Baker said.

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