Sicker Denver patients prompt hikes while rates stay flat in mountains

By Katie Kerwin McCrimmon

Sicker patients have prompted Denver Health to ask for a 17.5 percent hike next year in health insurance rates while the biggest carrier in western Colorado, Rocky Mountain Health Plans, is working to keep rates flat in high-cost resort counties.

When Colorado’s insurance regulators unveiled proposed 2015 rates for health insurance last week, the numbers were all over the map. (Click here to read Consumers demand lower rates, universal care.)

Denver Health provides care to patients of all ages. Some who have signed up through Colorado's Health exchange are sicker and Denver Health is therefore proposing a rate increase. (Photo courtesy of Denver Health.)

Denver Health provides care to patients of all ages. Some who have signed up through Colorado’s Health exchange are sicker and Denver Health is therefore proposing a rate increase. (Photo courtesy of Denver Health.)

Denver Health proposed the biggest increase among carriers in Colorado, while other insurance companies proposed modest increases. New Health Ventures, which markets plans called Access Health Colorado, proposed a 22 percent cut in rates while the Colorado HealthOP wants to cut rates by about 10 percent overall.

For Denver Health, new patients entering the system necessitated the proposed increase.

“We are taking care of really sick patients,” LeAnn Donovan, executive director of managed care for Denver Health, said in a written statement. “This requires more health care resources in terms of medical staff, medications and testing. The proposed rate increase will help us cover these costs while allowing us to continue to provide high quality comprehensive care.”

Donovan said Denver Health is known for providing quality care to patients with complex medical problems. Denver Health has declined to say what percentage of the market it captured through health exchange sign-ups, but Donovan said Denver Health offers a lot of bang for the buck.

“Denver Health’s 2015 rates are still very competitive and in a lot of cases offer more services at a lower cost than other plans,” Donovan said.

In western Colorado, Rocky Mountain Health Plans dominates the Grand Junction market and has been one of the few carriers to offer health insurance in ski resort areas and other parts of western Colorado where health costs traditionally have been much higher than elsewhere in the state.

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Colorado’s resort region that includes Aspen, Vail, Glenwood Springs and Summit County had the distinction of being the costliest place in the nation to buy health insurance in 2014.

Steve ErkenBrack, president of Rocky Mountain Health Plans, isn’t promising sharp drops in costs overnight in the resort areas. But Rocky Mountain is trying to keep insurance premiums flat in western Colorado while allowing people to keep their doctors and continue to go to the hospitals where they are accustomed to getting care.

“Our focus has been: how do we get our neighbors in western Colorado to move from 2014 to 2015 without major price increases?” ErkenBrack said.

Overall, Rocky proposed an average premium cost increase statewide of about 3.1 percent. But ErkenBrack knows that doesn’t matter to consumers.

“They don’t care about the overall averages. They care about what they’re going to be paying for their doctor,” he said.

People who buy Rocky Mountain’s plans in Front Range communities could see modest increases while elsewhere costs should be comparable to this year.

“Pricing will stay flat in Delta and Montrose and other parts of western Colorado. The pricing in the resort communities will not be going up, but we’re going to have to see the utilization data,” ErkenBrack said.

In recent years, people in some resort counties either have used more health care or visited more expensive doctors and hospitals. And that has driven up both the overall cost of care and the cost of insurance.

ErkenBrack said bringing those costs down is a complex proposition that will take time. In recent years, before health reform began taking effect, double-digit premium hikes became the norm. ErkenBrack said it’s important to watch the data and tinker with prices gradually.

“It’s going to take time. Pricing is not a function of the insurance carriers. It’s a function of what the providers are going to charge,” he said. “Hopefully we’ll be able to continue to work with the providers and bring those rates down.”

While ErkenBrack did not want to comment specifically about other carriers’ proposed rates, he said consumers should be very careful about perusing what they’ll get for the money they spend. He said carriers are not wise to lure in thousands of new customers with low rates, then hit them with big premium hikes in future years.

“People aren’t served well by wild fluctuations in the rates,” ErkenBrack said. “This is a matter of looking at pricing, but also at quality. (At Rocky Mountain) we’re not going to sacrifice quality.”




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