Higher health premiums? Let’s find the cure

The Affordable Care Act is a great idea in principle for this reason: Finally, after decades of struggle, the richest country in the world is making it possible for its sickest citizens to receive affordable, subsidized health insurance. It also is making it possible for healthy, working families of modest means to buy subsidized insurance. This is a commendable act.

For large segments of the population, however, the act has yet to deliver affordable care. Ask a roomful of middle-class people for a show of hands on who is paying more for health insurance and prescription drugs this year, and nearly all would raise their hands.

Ask a roomful of small-business owners how many have chosen to participate in the health insurance exchanges set up by the Affordable Care Act and few if any would answer in the affirmative. Of the more than 8,000 small businesses in Colorado, only 100 had signed up for health insurance on the exchange as of December. They cite the high premiums and their inability to qualify for the tax credits as reasons for their failure to participate.

One healthy Colorado family of four saw its insurance premiums rise $100 a month this year and its co-pays double. When the family, which doesn’t qualify for tax subsidies, investigated buying a similar plan on the exchange, it found the lowest priced coverage would cost $400 more a month than its existing plan. As one woman said, “Who can afford that?”

The potential for higher premiums was grossly downplayed during the rollout of the act.
That’s why it was good news on Feb. 3 when Colorado Insurance Commissioner Marguerite Salazar announced that her department would investigate the high costs of health insurance for people outside metro areas. Rural Coloradans, to their credit, are raising a ruckus about the higher costs and are getting some response.

Perhaps it is time for more of us to raise a ruckus. We would like to see Salazar and other insurance regulators expand their investigations into these higher premium and prescription-drug costs.

The idea behind the health-insurance exchanges was that more insurance companies would be competing with one another and that competition would force down prices. That hasn’t happened – or, if it has, we’re not seeing it. We need to understand why this hasn’t occurred.
We also would like the insurance regulators to examine why, with a sudden huge influx of new customers and, theoretically, a much bigger market to sell into, insurance companies continue to charge ever higher rates.

Yes, it does cost more to take care of sick people, and yes, it does cost more to offer maternity and mental health care as the Affordable Care Act requires. But we maintain that our insurance companies and health-care providers can figure out how to use these new economies of scale to lower costs instead of raising them and blaming the federal government.