A group of Colorado lawmakers are working to lower health insurance premiums for residents on the individual market created in the wake of the Affordable Care Act. Rates are predicted to rise 34 percent on average next year. There are concerns that healthy people will opt out of coverage and that could cause rates to rise even higher as the insurance risk pool thins out.
Bob Collins, a small business owner and the father of three in Thornton, said the rise will cost him $18,000 to cover his family next year. That’s a significant increase to what he pays now.
“My wife and I would dump it in a heartbeat if we didn’t have kids,” he said.
Collins spent time at the state Capitol last week to testify to the Division of Insurance how the hike in health insurance rates would hurt his family.
“They talk about wanting a healthier base,” he told commissioners. “But what you’re doing is the exact opposite because there’s no incentive for someone who is healthy to pay that much out of pocket.”
Most Coloradans get health insurance through their employer or government assistance, including Medicaid insurance for poor or Medicare for the elderly. Still, a sizeable chunk of the state’s population – 500,000 – are on the individual market.
Those who earn less, but are not poor enough to qualify for Medicaid receive subsidies to make their insurance more affordable. Others don’t qualify for any subsidies at all, about 40 percent of the total. That worries state Insurance Commissioner Marguerite Salazar. She said this group is middle class and includes many who can’t yet retire.
“I believe we’re going to lose people,” she said. “They’re going to go uninsured. They’re going to put themselves at risk for medical bankruptcies and if they do get sick, they’ll have to pay it all out of pocket.”
Insurance company representatives were also at the Capitol. They said a pool with healthier people opting out, medical costs going up and President Trump’s executive order repealing cost sharing payments to insurers are all factors for the rate hike.
“We are not at all enthused about those increases and see them as a necessary component to continue to provide coverage,” said Charlie Sheffield with the Colorado Association of Health Plans. “And it’s important to note that as costs go up or prices go up the rates need to go up as well.”
While many were angry at Trump’s executive order, Adam Atherly said the focus is overblown because rates were already going up. He’s a professor of health economics at the University of Colorado. Trump’s executive order increased premiums in Colorado by another six percent.
“This is a continuation of a trend that’s been going on,” he said. “Four or five years ago, the exchanges seemed like they had tremendous promise and this is a place you’d see a lot of people buying insurance and this promise has just largely not been realized.”
At the state level, both Democrats and Republicans are discussing a proposal that would reimburse insurance companies for high-cost patients. They hope it will help lower premiums for everyone and free up more federal money for the state. Democratic Rep. Chris Kennedy of Lakewood may sponsor the legislation, but said it’s still being fleshed out.
“If we don’t figure out how to pay for it, it may or may not be worthwhile, Kennedy said. “I think we’re still investigating that question of, do we have the money? Is this kind of program worth the savings we could achieve?”
Any legislation would likely require all ratepayers on the individual market to pay an extra fee and some state money.
“We can’t just increase everybody’s rates and not come up with a solution,” said Republican Rep. Bob Rankin of Carbondale.
He serves on the state legislature’s Joint Budget Committee. In his district on the Western Slope, premiums will go up 40 percent.
Rankin is sponsoring a separate bill to create just one, statewide insurance rate. He said he wants to improve how the markets work, even though he wishes Congress would undo the Affordable Care Act.
“I’d like to see them repeal Obamacare and come up with a better solution,” he said. “I, like everybody else, am just really frustrated about what the solution is or can be or will be.”
He said Trump’s executive order contributing to higher rates isn’t helpful. Eighteen states are suing to block it, but not Colorado. Gov. John Hickenlooper has joined a bipartisan group of governors asking Congress to pass legislation to stabilize private health insurance markets.
For residents facing tough choices like Bob Collins, ideas of affordable family health insurance of any ideological stripe are fading.
“I see a high level of apathy and inaction and people saying it’s not their fault,” Collins said. “How can you have confidence in anything productive happening? It’s ridiculous.”
Capitol Coverage is a collaborative public policy reporting project, providing news and analysis to communities across Colorado for more than a decade. Fifteen public radio stations participate in Capitol Coverage from throughout Colorado.