Federal funding was approved Wednesday that will help Southwest Colorado residents save an average of 30% on insurance premiums purchased through the state health care exchange.
“People that pay for their own insurance will now have a few thousand dollars more each year to buy a home, or save for college, or save for retirement, or take a vacation,” Gov. Jared Polis told The Durango Herald in a phone interview.
A reinsurance program created by the Colorado Legislature at the end of the session is expected to provide the savings to those purchasing insurance through Connect for Health Colorado. The exchange serves residents who do not have insurance through an employer or government program.
In La Plata County, about 3,000 people purchased insurance for 2019 on the exchange set up by the Affordable Care Act. In Montezuma County, about 800 customers purchased insurance through the exchange.
Customers of the reinsurance program are likely to see savings next year because the reinsurance program will lower the financial risk for the companies that offer plans on the exchange.
The reinsurance program is expected to provide funding for insurance companies to cover high-cost insurance claims between $30,000 and $400,000, said Joe Hanel, a spokesman for Colorado Health Institute.
Savings in Southwest Colorado could outpace savings in other parts of the state because insurance companies can request that the program pay a higher percentage of high-cost claims on the Western Slope, he said.
The federal government will provide about $163 million to cover the high-cost claims, said Vincent Plymell, assistant commissioner with the Colorado Division of Insurance. Millions of dollars in state funding is already in place.
The expected savings are not final because the Division of Insurance must review the proposed Connect for Health plans. The agency will release the approved plans in September or October, Plymell said.
The reinsurance program is one piece of Polis’ plan to lower health insurance costs for Coloradans. The state also hopes to import affordable prescription medications from Canada and support county-level health care alliances.
County-level alliances negotiate prices directly with health care providers on behalf of county residents and then contract with insurance companies to provide coverage.
A group in La Plata County is exploring forming such a health care alliance.
“We look forward to providing savings to people with employer-backed care,” Polis said.