I think this whole discussion about a ‘public option’ versus ‘co-ops’ has gotten totally wrapped around the axle.
A co-op, when considered in its historical context, should not be some sort of national government sponsored enterprise. But, this is the way the idea of a co-op is being put forward under the health care reform debate. With the Government putting forth the seed money, it is for all practical purposes a GSE.
Instead, it should be a mechanism where small businesses can form a group to buy insurance coverage for their employees. And, historically, the seed money is raised by the co-op (e.g., by selling shares to the members).
Additionally, the co-ops should be able to shop for insurance nation-wide. In other words, the individual States must not be allowed to use anti-competitive licensing laws to restrict which insurer is allowed to sell policies to any given State’s residents.
O wants to increase insurance coverage without increasing cost to taxpayers? This is the way to do it.