This idea has come up in the health care debates recently. Many people poo-poo it; I heard a legislator saying that coops can work well for grain elevators and the like but not for health care. There are two successes, Health Partners in the Twin Cities of Minneapolis and the Group Health Cooperative of Seattle. There have been failures. My mother was a member of HIP which merged into Group Health Insurance which apparently is oging to health. They claim that one needs 600,000 members in the same location. This enables the coop to have its own physicians and buildings.
NPR had a presentation on this, in response to the Senate Finance Committee having approved this Unfortunately, the difference between medical cooperative and a non-profit insurance company like Blue Cross Blue Shield is that in a medical cooperative, one has the opportunity to vote for a board of directors. In the Seattle one, only one percent of the members vote. Minnesota does do better at one third. I belong to several professional societies; we get to vote for directors, the president and maybe a few other officers. Although, the members do have their "say" through a yearly vote, and the organizations seem to do a fine job, their costs do seem high and we really don't have a meaningful voice in the day-to-day running of our organization. Similarly, the Cooperatives have less complaints than regular insurance companies but costs are at best comparable.
In China, 726 million people in rural areas are members of a "rural cooperative insurance system," but where the government pays eighty percent of the costs. article does not discuss other people who might be living in rural areas such as hte medical providers), are coverd by a rural cooperative system. Yet, there are problems with theft, $100,000.00 out of about five billion in one county alone.
The real challenge is to make them particpatively run, where each decision is made by a randomly chosen subset of the members, from how much each person is paid and whether they are going to get. Also the amount of premiums or membership fees should be voted on by the group and should be a median of the amount selected.