The reason Salazar says she approved higher insurance premiums in the resort counties is because prices for health care services are higher there. The average payment for in-patient hospitalization in one resort county, for instance, is 61 percent higher than the rest of the state. Setting premiums too low, Salazar says, would drive carriers from the market, decrease competition and send insurance prices even higher.
The reasons why health care services cost more in the mountains are complicated, Salazar says, and, since Colorado’s Division of Insurance doesn’t regulate health care providers, “it’s really hard for us to start wading into those discussions.”
Salazar says she will convene meetings with Colorado’s hospital association, insurance companies, local health improvement groups and others to generate cost containment ideas. She had hoped to alter the geographic ratings for 2015 but stepped back from that plan because there wasn’t data to support it. She says one state lawmaker from the resort region is contemplating asking for additional subsidies for residents of high cost areas.
High premium areas generally reflect a lack of competition between insurers or health care providers, or both.
In each of Colorado’s highest-cost counties, which have low populations (ranging from 17,263 to 56,963), there is only one small hospital. Larger medical centers are far away over roads that can be impassible in winter. All have an adequate number of primary care providers, as defined by the federal government, but local specialists can be hard to find.
There is significantly less competition among insurance carriers in the mountain resort counties than in urban Denver. Colorado’s health insurance exchange offers a total of 41 plans from four carriers in the resort region, versus 78 plans from eight carriers in Denver. The lowest price silver plan for a 40-year-old Denver resident is $200 a month less than a comparable plan in the resort counties.
Kaiser Health News (KHN) is a national health policy news service. It is an editorially independent program of the Henry J. Kaiser Family Foundation.
Thu, Feb 06 2014