A cooperative health insurance company is organized as a mutual insurance company In the United States a mutual insurance company is typically organized as a cooperative or mutual benefit corporation A cooperative health insurance company is owned by its members who are also its insureds The members pool their resources to provide health coverage for themselves and their families
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There are a variety of laws that control the cooperative health insurance industry The most important of these is the Employee Retirement Income Security Act or ERISA This law sets minimum standards for fiduciary responsibility that must be met by any company offering retirement savings plans to employees
The Affordable Care Act (ACA) includes a provision for cooperative health insurance which allows workers to create health insurance cooperatives as an alternative to traditional employment-based health insurance The co-ops are member-owned and controlled and receive tax breaks intended to make them more affordable
Every state has different laws regulating the formation and operation of cooperative health insurance plans In order to operate in a particular state a cooperative health insurance plan must be registered or licensed as an insurer in that state The National Association of Insurance Commissioners (NAIC) is an organization composed of the chief insurance regulatory officials of the 50 states the District of Columbia and five U.S territories The NAIC maintains a multistate database that includes information about all insurers authorized to do business in a particular state including cooperative health insurance plans
There are no specific legal controls for cooperative health insurance However the general rules that apply to commercial health insurers also apply to cooperative health insurers In addition cooperative health insurers must comply with any specific requirements that are imposed by the laws of the jurisdiction in which they operate
In the United States there is no single system of cooperative health insurance Laws governing health insurance are made at the state level and each state has different regulations In general however there are some basic requirements that all cooperative health insurance plans must meet Each state has its own laws governing cooperatives However in order to be recognized as a legal entity a cooperative health insurance plan must meet certain requirements set by the National Cooperative Business Association (NCBA) These include having a formal governance structure electing officers and maintaining records of its members and operations
