Garfield County hears about cooperative program to lower insurance rates

Representatives from Peak Health Alliance came to Garfield County Thursday to gain support for a unique health-care group that has successfully reduced insurance premiums by negotiating lower group rates for medical care.

Health care costs on the Western Slope are among the highest in the country. That affects insurance costs as well, and has caused a health insurance crisis, according to Garfield County Commissioner Tom Jankovsky.

The rate of uninsured in Garfield County went from 12% to 20% in the past few years, which puts the local care providers at risk, county commissioner Tom Jankovsky said Thursday.

“Forty percent of (a local provider’s) customers are uninsured, and the sustainability of their model is in question. Can they continue if the uninsured continue to grow like that?” Jankovsky said.

Enter Peak Health Alliance, a nonprofit that formed in 2019 and has reduced the high prices of health services and insurance premiums in Summit County. It’s now looking to do the same in Garfield County.

“We feel very strongly that empowering consumers and communities is the only way to solve this problem,” Peak Health Alliance CEO Tamara Pogue told a group of 75 people crowded into the Garfield County Administration Building in Glenwood Springs.

A second presentation was given in Rifle Thursday afternoon.

Peak Health started the process of talking to hospitals and other health-care providers in Summit County several years ago. They got 5,000 people to sign letters of interest in participating in an insurance package arranged by Peak Health.

With that theoretical group of insurance purchasers, Peak Health began talking with hospitals and other providers to negotiate lower prices.

At first, they were laughed at, Pogue said.

“At the end of the day, (providers) recognized that as a purchasing alliance we had the ability to actually make life better for them,” Pogue said.

For hospitals, the benefit is that more Summit County residents might get care locally if it were affordable, rather than traveling to the Front Range for services.

The program only works if the hospitals buy into it and are willing to be transparent about costs, Pogue said.

The fee schedules hospitals provide to insurance companies do not always reflect the actual cost of the services, according to Pogue, which is where Peak finds room to negotiate.

Price transparency in hospitals has been a hot topic in the health-care world for some time, and Peak Alliance doesn’t address that for consumers. Peak Health representatives sign non-disclosure agreements while they negotiate lower prices.

After that, Peak solicited bids from insurance companies and landed on several plans from Centura, which were the lowest premiums that company had ever offered.

Before Peak Health Alliance and the reinsurance bill sponsored Sen. Bob Rankin and signed by Gov. Jared Polis last year, prices for health-care services in Summit County were as much as five times what Medicare pays for those services.

After reinsurance and Peak’s work, costs dropped to be two to three times the cost of Medicare.

That’s not perfect, but it’s better than what it was, Pogue said, and was enough to drop premiums for the individual market.

Peak’s model doesn’t change the way people buy insurance, Pogue said.

Right now, Pogue is asking individuals and representatives of local businesses to sign non-binding letters of interest in the proposal. The more people who express interest, the more hospitals might be willing to negotiate.

After collecting signatures, Pogue will start working on a fee schedule with Garfield County health providers.

“Our hope is that we can get a fee schedule done by the end of February. We’ll take that fee schedule and we’ll bid it out to the insurance carriers,” Pogue said.

Then, Peak will do the same thing as in Summit County — shop for an insurance carrier to put the insurance packages for businesses and individuals in Garfield County on the market for 2021.

Peak is also working with other counties in the mountain west (though not Pitkin or Eagle Counties, as they have other programs) to find lower rates, because insurance companies look at costs regionally.

Health-care costs are higher in the Rockies and on the Western Slope for a number of reasons, including distance from larger metropolitan centers, which Peak can’t change.

“Our prices may always be higher,” Pogue said. “The question is, how much higher?”

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