3.

There are other, and probably far more important, problems with using Group Health as a model for what the co-op compromise could deliver all over the nation.

Among them: the idea that Group Health provides a structure that can be quickly replicated to great positive effect. Don Mitchell, a retired physician and the chair of the Western Washington chapter of Physicians for a National Health Program, pointed out that it has taken "years" (62, to be exact) to get Group Health to its current level of service and national stature. You can’t just create a bunch of federally-chartered, citizen-run health care concerns all over America and expect them to be high quality on day one.

But perhaps the biggest problem has to do with size. Group Health achieves efficiencies and economies of scale—which in turn lead to cost savings, a Holy Grail of health care reform—precisely because it’s not small.

Size matters quite a lot in cutting health care expenses. That, by the way, is the whole point of the public option: to create a government-backed national health care plan that’s so big it will be able to compete nationwide and bargain for lower costs all over the country, all at once. “Because [co-ops] would be at most state-wide in scope and not be national,” Mitchell said, “they would lack the bargaining clout that a national organization would have in terms of driving down costs vis-à-vis private health insurance companies.”

This is why, even though the Commonwealth Fund recently placed Group Health among the nation’s “shining examples of co-operative health care,” Dr. Karen Davis, blogging for the group, nevertheless described the idea of filling the country with Group Healths as a “difficult” and “uncertain” proposition.

Bottom line: Group Health has found a way to work well in the Pacific Northwest after 62 years of operation. But it’s not the small, easily-replicated co-op that Maria Cantwell and others want it to be. In fact, one important lesson of Group Health ends up being exactly the opposite of what advocates of the co-op compromise seem to want to hear: it takes a big entity with experience in the health care market and significant financial clout to push the industry in the right direction.

An entity like, you know, the federal government—which, under the public plan, would be doing just that at the national level.

Last of three parts. Part one here, part two here.

2.

A few things to know right off the bat:

Group Health Co-operative is not, technically, a co-op. It is instead a consumer-governed non-profit corporation (a distinction with important tax differences), and a large one at that. It currently covers about 600,000 members, and last year took in $2.7 billion in revenue while paying its president and chief executive officer, Scott Armstrong, a $1.2 million salary. Its main competitors are familiar private insurance names—Regence Blue Shield and Premera Blue Cross—and its rates have risen over the years just like those of any other health insurer.

Meaning it’s not a small, average-citizen-controlled health care co-operative of the kind that Maria Cantwell and other Senate leaders seem to be suggesting would appear all over the country through passage of the co-op compromise. It's also not jaw-droppingly unique (and certainly not as unique as it used to be). “To the average person or the average enrollee there’s not a lot of difference between Group Health and the average health plan,” said Stephanie Marquis, spokesperson for the Washington Insurance Commissioner’s office. She added, in reference to the co-op compromise proposal: “When I first heard it, and I thought of a co-operative, I have to be honest, my mind did not go first to Group Health.”

Certainly Group Health does have some attributes worth noting in the health care reform discussion. It runs its own facilities; employs salaried doctors (rather than contracting mainly with “preferred providers,” as other insurers do); and has been a leader in web-based medicine, electronic medical records, and the effort to promote contact with primary care physicians (rather than the see-a-specialist model that has helped drive up costs around the nation). Its quality of care is well-regarded, and the number of complaints about it to the Insurance Commissioner's office is far lower than the number for its competitors.

Diana Birkett, director of federal relations and policy for Group Health, said these are the attributes that naturally bring Group Health attention. “We’re being looked to as a model because we’re an integrated organization,” Birkett explained. “We’re not just an insurer. We’re not just a member-governed organization. We’re not just a provider. We’re all of those things.”

Notice what she didn't say: that Group Health is a small co-op of the kind that some in the Senate seem to want to create in communities all over the country. That's because, as far as can be determined from the still-sketchy details of the co-op compromise, it's not.

Previous part here, final part later today.

1.

There’s a lesson to be learned from Seattle's Group Health Cooperative, but it’s not the one Senator Maria Cantwell has been offering.

To hear Cantwell and other moderate Democrats tell it, one of the best ways for Congress to fix the nation’s broken health care system this year would be to create a bunch of Group Health clones all over the country. “I think Group Health has done well in the Pacific Northwest,” Cantwell said on June 22, pushing the idea that all of America should follow the Seattle-based health care provider’s lead. “It’s a tested system.”

The Senator has fuzzed-up her position somewhat since that day, but she still supports the idea that the Group Health model could work nationally—and it's not hard to guess at the political reason for this.

In promoting the Group Health model, Cantwell is toeing a line laid down by senior members of a powerful Senate committee on which she sits: the Finance Committee. These political heavies, who are going to play an outsized role in the way Congress tackles health care reform this fall, have recently latched on to the so-called “co-op compromise” as a way of gaining enough votes to pass some kind of reform bill. Naturally, a place called Group Health Co-operative is being used to make their case.

When you step back, it’s a bit bizarre. Suddenly the idea of locally-run health care co-operatives, which sounds pretty damn socialist, has come to be seen as less socialist than the idea of a nation-wide health care plan” run by the government?

But that’s politics.

The real question: Is Group Health Co-operative, founded in 1947 and currently the second-largest health insurer in Washington State, really the national model that supporters of the co-op compromise think it is?

The answer, in parts, as the day goes on.