A slew of new state legislation could help lower health care costs in Southwest Colorado, where hospital monopolies are associated with high insurance prices.
A recent report by Colorado Health Institute showed La Plata and Montezuma counties don’t have competitive markets for hospital care or much choice for insurance outside an employer-sponsored plan.
The lack of competition among hospitals and insurance companies correlates directly with high prices paid by those who do not have insurance through an employer, the report showed.
The evidence showing the effect of lack of competition was “striking,” said Joe Hanel, a spokesman for the institute.
“Lots of times, you do this statistical research, and it looks a lot messier,” he said.
The report showed a single 40-year-old in La Plata County would pay $692 per month for insurance for a midlevel plan from Connect for Health Colorado, but in Denver would pay $414 per month.
In La Plata County, about 3,000 people bought insurance for 2019 through Connect for Health Colorado, the state health exchange.
In Montezuma County, about 800 customers bought insurance through the exchange.
People with employer-sponsored insurance could face higher costs as well because of the limited number of hospitals, but data is not available to show that trend, Hanel said. Montezuma has a single hospital, and La Plata County is home to Mercy Regional Medical Center and Animas Surgical Hospital.
The Colorado Legislature tried to address the high cost of health care this session by passing a hospital-transparency measure, a reinsurance program and a public option for health care. Lawmakers also approved a bill to allow for prescription drugs to be imported from Canada and a cap on the cost of insulin, a medication diabetes patients rely on.
“It was a really big session for specifically health care costs,” Hanel said.
The hospital transparency bill is expected to allow policy analysis to identify inefficiencies within hospital systems and could lead to future reform, he said.
About 30 percent of all health care spending pays for hospital services, so it’s an important area to examine, he said. However, lowering costs for hospital patients in rural areas can be difficult because the fixed facility costs must be covered by fewer people, he said.
In addition, rural areas can have a disproportionately large percentage of low-pay and no-pay patients, increasing the burden on the smaller percentage of patients with commercial insurance, said Sarah Silvernail, a spokeswoman for Mercy Regional Medical Center.
Colorado consumers could see lower costs from the public insurance option in development, but it’s unknown how insurance might work, Hanel said.
The state could allow consumers to buy Medicaid, an existing state insurance program available to low-income residents, he said. A public-option proposal is expected to be presented in November.
The reinsurance program is intended to bring down premiums for those who purchase insurance through Connect for Health Colorado on the Western Slope by 30% to 35%.
The reinsurance program will lower the financial risk for insurance companies by reimbursing them for an average of 60% of medical claims costing $30,000 to $400,000. The reinsurance program will rely on federal funding that the state applied for this week, according the Division of Insurance.
Bayfield resident Guinn Unger said the state measures don’t offer long-term solutions. Unger is a member of the Indivisible Durango Health Care and Senior Issues Committee, a group that advocated for health care reform. He also is working to found a new group, Health Care Durango, focused on insurance education.
He would like to see the U.S. Congress establish nationwide Medicare for all insurance that would eliminate premiums and co-pays.
“Everybody, truly, would be able to afford it,” he said.
Medicare for all could cap how much health care providers receive in reimbursements, slowing the rise in health costs, he said. Medical inflation was 125% between 2007 and 2016. The overall inflation rate during the same period was 20%, he said.
For more information about Health Care Durango, email Unger at firstname.lastname@example.org.