CMS Issues Proposed Rule on Creation of CO-OP Insurance Plans - July 19, 2011

The federal Centers for Medicare & Medicaid Services on July 18 released a proposed rule to implement the Consumer Operated and Oriented Plan (CO-OP), as authorized under the Affordable Care Act. CO-OPs are private, non-profit insurance plans whose members participate in plan governance by electing CO-OP board members. A majority of the board members must also be participants of the plan. In addition, CO-OPs must use profits for the benefit of enrollees. This proposed rule suggests eligibility and participation standards for CO-OPs and sets certain terms for repayable loans available from a pool of $3.8 billion to pay for start-up costs. Comments on the proposed rule are due by Sept. 16, 2011.