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HELENA- The Montana Health Cooperative is hoping to give Blue Cross Blue Shield of Montana a run for its money.

According to John Morrison with Montana Health Cooperative, 60% of Montanans with major medical insurance have policies through Blue Cross.

"Too many Montanans lack options now for health coverage. Once again co-ops are arriving to provide a solution."

A coalition of small businesses and community leaders have formed the Montana Health Cooperative. Eric Schindler with the Montana School Services Foundation says now the U.S. Department of Health and Human Services is loaning the cooperative $58 million to get business started.

"Basically we've been given approximately a two-year runway to build a new insurance company. There are many things that have to be done with that: claims processing, provider networks, wellness programs, disease management."

The program is awarded under the Affordable Care Act with the goal of creating competition and therefore driving down the cost of health care. However, critics of the federal health reform law say the implementation for cooperatives isn't transparent.

Congressman Denny Rehberg tried to defund the program when he presented his budget in 2010.

"I don't think we ought to be using the hard-working taxpayers' own money to subsidize new government approved health insurance companies."

Blue Cross reports it's been anticipating this new co-op coming online and issued the following statement on Tuesday:

"As the leader in providing high quality, affordable health care solutions to Montanans for over 70 years we are well poised to continue to provide the best services and products to all Montanans."

The Montana Health Cooperative reports it will be ready to issue policies on and off the health insurance exchange by 2014.