Insurance head hears concerns in Garfield County
Snow kept Colorado Division of Insurance Commissioner Marguerite Salazar from coming to Glenwood Springs this week to hear concerns about the high costs of individual health care in Garfield County next year.
But that didn’t keep her from getting an earful anyway as she and other state officials took questions Wednesday night during a webinar focused on why Garfield rates will be much higher than other parts of the state as the federal Affordable Care Act is implemented.
“We have actually considered moving to Denver because our … health insurance will be 35 percent of our take-home pay. Was this your goal?” asked one of those who submitted questions anonymously during the webinar.
“Well, that was never our goal at all. Our goal is to provide a healthy insurance market,” Salazar said.
She said rates are based on health care utilization and cost of care — factors the Division of Insurance doesn’t control.
Still, she said, “We want your ideas. We understand that the rates appear to be very high.”
Indeed, one example state officials gave Wednesday showed a 55-year-old nonsmoker paying about $703 for the cheapest plan available in the geographic rating area Garfield is included in, compared to $325 in Denver.
Garfield is included in a resort-area region that includes Aspen, Vail and Breckenridge. The region has higher costs of health care due to factors such as higher real estate and wage costs providers face.
But some Garfield residents — and county officials, who have taken up the cause on their behalf — question why people living in the working-class county should pay the same rates as well-heeled people in places such as Pitkin County.
Said Salazar, “Some folks have said, ‘Well, move us into Grand Junction, that’s really where we get our care,’ but we cannot do that. It is against the federal regulations.”
She said those regulations prohibit moving other counties into metropolitan statistical areas, such as Mesa County, for rating purposes.
But insurance division officials say if people travel for health care, that’s taken into account in what they pay for such care in the Colorado All Payer Claims Database, one of the measurements the state used in establishing ratings areas.
Garfield County Attorney Frank Hutfless, who is tracking the issue on behalf of the county commissioners, contends Salazar is wrong on the federal requirements, and the state has the ability to group counties without consideration to metropolitan statistical areas.
Hutfless says there are 23 counties where health care costs based on the claims database are higher than in Garfield County.
“And yet Garfield County is put in the resort area, which is the highest-cost area in the state,” he said.
Local hospital costs also are considered, but he said the average cost for nine common medical procedures in the county are lower than the state average and for the Denver area.
“Those (other) areas pay less for health insurance than we do. It doesn’t make any sense,” he said.
Colorado was required to create the ratings areas under the Affordable Care Act. Insurance division official Tom Abel said it could have made the whole state one rating area, or created an area for all parts of the state not in a metropolitan statistical area. But in either case, there would have been winners and losers, he said.
Salazar acknowledged that the system still isn’t perfect, resulting in some getting discounts and others paying more.
“But this is a brand-new program. It’s a brand-new way to try to provide health insurance. Nobody has ever done this before. So there’s going to be some kinks to work out,” she said.
But she said the ultimate goal is for everyone to be able to afford health insurance, and she noted the subsidies available to help some people do that.
A tax credit is available for some based on income levels and other criteria for the Connect for Health Colorado insurance exchange, and officials encouraged people to apply for those credits even if they don’t think they qualify, just to make sure. State officials say that in the case of the 55-year-old nonsmoker referred to above, if that person’s income is $45,000, he or she could receive enough of a tax credit to result in a final cost cheaper than it would be in Denver for the least-expensive plan.
People deciding not to buy insurance also can avoid paying the federal penalty if the cost of insurance exceeds 8 percent of household income.
U.S. Rep. Jared Polis, D-Boulder, has raised concerns about the high premiums being charged in Summit County, and said it should be grouped with Clear Creek and Jefferson counties, where rates are lower. He’s also called for a waiver for the resort-region area from the Affordable Care Act next year so the cost of premiums can be addressed.
Salazar said it’s too late to do anything regarding next year’s rates.
“The 2014 premiums are already supporting plans being sold right now,” she said.
She said the state is looking into what can be done differently for 2015 and welcomes suggestions on possible solutions, but it must submit any proposed changes to the federal government by Jan. 1.
Hutfless said Garfield commissioners will be considering next steps, which might range from trying to argue its case more forcefully with the state, to asking state lawmakers for an investigation or some financial help for those being affected.