By Katie Kerwin McCrimmon
Enraged that Colorado officials are refusing to change health insurance rating systems for this year or next, Garfield County’s attorney and commissioners are considering suing the state.
“They’re violating the law,” said Garfield County Attorney Frank Hutfless.
He said the state is discriminating against Garfield County by placing it with the highest-cost resort areas and therefore making it too difficult for people to afford health insurance, which was the primary purpose of the Affordable Care Act.
Glenwood Springs, known for its natural hot springs, is the largest city in Garfield County.
Colorado divided the state into 11 geographic rating areas and people in some rural and resort areas pay significantly more for health insurance. Those living in mountain communities from Summit to Garfield counties have been especially angry and U.S. Rep. Jared Polis, D-Boulder, has called for waivers so people don’t have to pay tax penalties if they skip buying insurance.
Health News Colorado revealed on Friday that Colorado Insurance Commissioner Marguerite Salazar has decided not to alter the state’s controversial geographic rating system. (Click here to read Controversial health rating areas won’t change for 2015.)
Hutfless said Gov. John Hickenlooper and his appointees have failed to respond to his county’s concerns even though residents there have provided extensive data showing that their historic health costs are lower than surrounding resort counties. (Click here to read Remote care, monopolies, pricey injuries hike resort, rural health costs.)
Residents of Garfield County are now facing insurance prices that Hutfless says are two to three times higher than they were in the past or that Coloradans who live elsewhere are paying.
He also accused state officials of blatant failure to properly regulate the insurance industry. Hutfless says state officials simply rubberstamped insurance lobbyists’ recommendations for geographic rating areas. Indeed, Colorado’s proposed geographic rating system that it sent on March 21, 2013 to the U.S. Department of Health and Human Services is nearly identical to insurance industry lobbyists’ proposal on geographic ratings that they submitted to the state a week earlier on March 13, 2013. (Click here to see the lobbyists’ proposal. And click here to see the geographic ratings plan that Colorado filed with the U.S. Department of Health and Human Services.)
“The lobbyists gave them the data and basically the state put their letterhead on it and sent it in. When I say verbatim, I mean verbatim,” Hutfless said. “They say they did thoughtful research and analysis.”
In fact, he believes state officials simply gave insurance industry officials the rating areas they designed. As a result, consumers in Garfield County are now paying higher insurance rates, effectively subsidizing higher-cost areas including Aspen and Vail.
“To say we are simply going to take an analysis of a (lobbying organization) and not look at any other data, then we’re going to represent that as our analytically based conclusion, that’s misrepresentation. That’s a fraud on the public,” Hutfless said.
He met Monday with two of the county’s three commissioners and they are now considering filing a lawsuit against the State of Colorado as soon as next week.
“We have been polite. We have been diplomatic and we have really tried to be part of the solution and we continue to get stonewalled by the state. We are past diplomacy,” Hutfless said.
Salazar said on Friday that her agency did not have adequate data to make any changes in the geographic rating areas. But data from Colorado’s All Payer Claims Database shows that Garfield County’s costs are lower than those in nearby Pitkin and Eagle counties. Data from 2012 — the most recent year available — show that Pitkin ranked fifth most expensive among the state’s counties for average annual health costs per resident of nearly $5,000. Eagle County ranked 11th most expensive with annual per person costs of about $3,700 while Garfield’s per person costs hovered around $3,500 in 2012. The average costs per person were highest in Jackson County at nearly $7,000 per person and lowest in Saguache County at about $2,000 per person.
Salazar has pledged to complete a study by May on why health costs are so much higher in some parts of Colorado than in others.
That offer rings hollow to Hutfless. He fears that Colorado will only seek information from industry officials who are profiting from high health costs, not consumers and business owners who must pay the bills.
“Where are their voices in all of this? I guess they are not part of this ‘diverse group of stakeholders,’ ” Hutfless said. “Once again we get this spin (from the state). Where’s the focus on the people who are paying (for health insurance).”
While Salazar has said there’s nothing she can do to change rates for 2014, Hutfless contends that’s not true.
“There’s nothing that prevents them from making changes immediately,” he said. “We have provided the state with reams of documents that include new data … showing that health care for this county is less on average than the Denver metropolitan area and less than the statewide average.
“The fact of the matter is that we’re really getting tired of being jerked around.”
Variations in cost analysis at the county level has been done routinely for 30 years by Jack Wennberg of the Dartmouth Health Atlas. The issue is costs, utilization and some proxy for quality. Many of these counties originate health episodes that get treated in urban hospitals. They are an intake system. If the county has a large number of young people working in resorts they are being asked to cross subsidize people with pre-existing conditions. So, it’s a Rubick’s Cube of complexity. The State D of Insurance is simply not funded or staffed to do the complex analysis that the Colorado Health Data Commission previously did. So they have to rely on industry sources that are biased and contaminated. I hate to say “I told you so”.
Well, gosh. Health insurance companies maximizing their profits at the expense of the general public? Who ever heard of such a thing?
Garfield County residents are beginning to “get it” in more ways than one. Health insurance isn’t about health. It’s about insurance. Insurance is a product sold by companies that are in business to make money, not to serve the general public, or in this case, the health of the general public. If county officials do, indeed, have the data they say they do, then this looks like yet another case of the state’s insurance industry leaning heavily on the fairness scale, and in the process screwing the little guy in Rifle or Battlement Mesa.