Bipartisan legislation could bring more competition to rural Western Slope health care markets
April 23, 2018
It's an issue that's been studied to death, but the problem seems very clear: Health insurance premiums on the individual marketplace on Colorado's Western Slope are insanely high and part of a trifecta of economic forces crippling small businesses and entrepreneurs.
Coupled with the high cost of living and tight housing market, health insurance rates for everyone who doesn't get their insurance through their employers — more than 50 percent of people statewide — are prohibitively high.
"What people are coming to realize on both sides of the aisle down here (at the State Legislature) is that this health insurance cost is never going to go away, so it's about time we start looking at the fundamental problems and not be so partisan about it," said Democrat Dylan Roberts, who represents Eagle and Routt counties.
Roberts is a prime House sponsor — along with Rep. Marc Catlin, R-Montrose — of HB-1384, a bipartisan bill that passed out of the House Health, Insurance & Environment Committee by an 8-5 vote on Tuesday, April 17, and to the House Appropriations Committee, which voted 8-5 on Monday, April 23, to send it along to the House floor.
“We have some of the best care in the world; we just don’t have access to it.”Chris RomerVail Valley Partnership
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On the Senate side, the bill is sponsored by Kerry Donovan, D-Vail, and Don Coram, R-Montrose.
There are currently 14 counties in Colorado, including Roberts' original home of Routt County (he now lives in Eagle), that have just one health insurance company available on Connect for Health Colorado, the state's individual-market health-insurance exchange. Eagle County has two companies available on the state exchange: Anthem and Kaiser.
If it passes both the House and Senate and is signed into law by Gov. John Hickenlooper, HB-1384 directs both the state Department of Health Care Policy and Financing and the Division of Insurance to come up with three different health insurance plans using the state's existing health care infrastructure in an effort to create more competition in those underserved counties.
The three plans need to be submitted to the legislature by February of next year, which would give lawmakers the rest of the next legislative session (ending in May 2019) to pick a plan and run a bill that would then finally begin lowering rates by generating more competition.
One of the plans the bill requires a proposal for is an option to allow Coloradans to purchase a health insurance plan through the state's Medicaid department. It's hoped a so-called "public option" in Colorado would create competition and drive down rates for private plans.
Right now in Eagle County, insurance brokers say a family of five pays about $2,800 a month for an Anthem plan or $2,000 a month for a Kaiser plan on the individual market — much less if they can keep their income below certain levels and qualify for Advanced Premium Tax Credits under the Affordable Care Act. But those income levels are very low for a expensive place such as Vail.
"Congress could help stabilize these insurance costs, but that's unlikely to happen anytime soon," Roberts said. "Many middle-class families must choose between paying for health insurance and paying for housing, child care or college tuition. This bill will set forth detailed options for how we can bring badly needed competition to the market."
The second plan his bill requires the two state departments to study is a public-private partnership plan modeled after the federal Children's Health Insurance Program, or CHIP.
And the third option the bill studies is what Roberts dubs a regional or community-based co-op plan that would allow small companies to band together to negotiate a group plan with a private insurance company. Sponsored by a chamber or business association, the group would then have the increased buying power of a much larger company such as Vail Resorts.
"This model works in other places like Wyoming and Missouri, and we're trying to see if we can duplicate it in Colorado," said Chris Romer, of the Vail Valley Partnership. "But there are a lot more rules in Colorado that make it harder, and at the federal level, they're trying to make it easier and we as a state are pushing back on it. That doesn't make a lot of sense."
ALL SOLUTIONS NEED TO BE EXPLORED
Romer said he's talked to Colorado's Interim Insurance Commissioner Michael Conway, who last month wrote a letter to the U.S. Department of Labor opposing rule changes that would make "multiple-employer welfare groups" easier to set up. Conway's concern is the plans would allow for coverage exemptions that pull healthy people out of other plans.
Romer said all possible solutions need to be explored aggressively to bring down health insurance costs on the Western Slope.
"In an environment with an already high cost of living and with employee retention challenges increasingly reliant on entrepreneurs, health care and housing are two issues that are the straws that break the camel's back in terms of being able to truly grow and scale an entrepreneurial business here," Romer said. "We have some of the best care in the world; we just don't have access to it."
Roberts said the $360,000 price tag for the bill is what generated the five "no" votes in committee, but that's the cost of the two state departments hiring accountants and the economists to do the actuarial analysis of the three plans. And he points out the current budget has the money to come up with a legislative solution for one of the Western Slope's most intractable problems.