State Legislation Spurs Sharp Drop in Health Insurance Costs
Thursday, July 18, 2019
DENVER – Health insurance companies operating in Colorado announced this week that premiums should drop by an average of 18% next year, according to documents released by the Division of Insurance.
Adam Fox, director of strategic engagement for the Colorado Consumer Health Initiative, says the state's individual insurance rates have stabilized, and consumers can look forward to lower costs, thanks to work by state legislators and advocates in the last session.
"A lot of the insurance premium reductions that we're seeing for 2020 are really due to Colorado creating what's called a reinsurance program, which is essentially insurance for insurance companies that helps them cover really high cost claims," he states.
Fox adds that efforts to stop surprise out-of-network bills, and a program to allow the purchase of medicine from Canada, also should help drive costs down.
Some Republicans opposed to the reinsurance program called the move a step toward a single payer system, and worried about the costs of having the state step in to pay for the most expensive patients.
Coloradans living in rural areas could see their premiums drop by 27% to 30% on average, a big relief for residents in 14 counties who have been hit with especially high costs, in large part because Anthem was the only carrier offering coverage.
But Fox warns that a case before the Fifth Circuit Court of Appeals to repeal the Affordable Care Act along with its consumer protections could throw a wrench into the works.
"The Texas case would potentially wipe out any of the benefits of reinsurance as well as strip away all of the financial assistance available through Connect for Health Colorado and our expanded Medicaid coverage," he states.
Plaintiffs argue that the ACA is unconstitutional after a key part of the law was removed, and that Congress would not have passed the sweeping health law without a penalty for people who didn't buy insurance.
Defendants point out that congressional majorities did vote to keep the rest of the Affordable Care Act intact when they eliminated the individual mandate penalty, as part of the 2017 tax bill.
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