Some wary of insurance bias on exchange board

DENVER – The newly appointed Health Insurance Exchange Board could be off to a bad start.

The makeup of the nine-member board, which is supposed to be balanced between insurance industry insiders and outsiders, insurance users and providers, Republicans and Democrats, has been criticized as it begins its work to create a health insurance marketplace for Colorado.

The health insurance exchange – part of the national health-care reform act passed by Congress in 2010 – calls on states to set up marketplaces where consumers can shop for insurance plans that meet federal requirements and where prices and benefits can easily be compared.

So when Eric Grossman, an executive vice president with Greenwood Village-based TriZetto, was appointed to the board, red flags went up with some observers.

TriZetto is a company that provides services to health insurance plans and benefits administrators.

The board already had four distinct health-care industry-connected members – the limit as proscribed by the legislation setting up the exchange – and Grossman could be No. 5, depending on who’s counting.

“We’ve ended up with five people with pretty strong health insurance ties, and a doctor who’s against federal health reform,´ said Dede de Percin, director of the Colorado Consumer Health Initiative, a group advocating for affordable health care for state residents. “With a group like that, it’s hard to see how we’ll end up with something different than what we’ve got.”

But exactly who’s an insurance industry insider and who’s not is sort of in the eye of the beholder. While three of the board’s members are indisputably executive officers of insurance companies, a fourth – Arnold Salazar, executive director of Colorado Health Partnerships – is the leader of a mental health managed-care company.

CHP is obviously a company that has ties to the insurance industry but is not an insurance provider – the same as TriZetto.

Recusal, not resignation

Grossman, who’s been in the eye of the storm since his appointment to the board by Gov. John Hickenlooper, was not available for comment for this column. His assistant said he was in Hawaii attending a conference and would likely not be able to be interviewed until after the Business Report went to press.

Grossman has publicly rejected any notion of resigning from the board, saying he would recuse himself from voting if he sees a conflict of interest with his company.

While the Colorado Consumer Health Initiative has been vocal in its protest of Grossman, so has the Colorado Public Interest Group, which has expressed concerns about his ability to vote independently on a board with those his company may do business with.

Lorez Meinhold, director of health reform implementation for Hickenlooper, said the board as it stands fulfills the requirements of creating legislation.

“What the legislation specifically says is a majority of the board members can’t have a direct affiliation with the insurance industry,” she said. “We didn’t go down the road of saying anyone who is connected to the health-care industry can’t be on the board. That would even exclude doctors.”

Meinhold said Grossman can bring expertise on information technology to the board, adding, “Having an IT system that works is very important.”

“We’re trying to do the best we can and find strong skills sets,” she said. “It’s a balance of experience and viewpoints.”

Meinhold said it would be unfair to assume that anyone on the board with a health insurance connection is automatically going to be obstructive or vote in a bloc when it comes to setting up Colorado’s exchange.

“To assume they’re just going to follow one another is not fair to them,” she said. “They are good people with a commitment to Colorado and to the success of the exchange.”

Meinhold said the ultimate goal is not just about reducing health insurance costs.

“The goal of the exchange is to make health care more effective,” she said. “Health-care reform is about lowering costs – and the exchange is a piece of that – but it’s also about coverage and expanding it to more people. And it’s about transparency, so people really know what they’re getting.”

De Percin said critics will be watching closely as the board goes about its work to make sure a bias toward the status quo doesn’t derail the creation of a better health-care system for Coloradans.

“It’s going to be a very high level of scrutiny to make sure we don’t create the same system we have, which we know doesn’t work,” she said.

Colorado’s exchange must be operational and ready for federal certification by Jan. 1, 2013.

Steve Porter covers health care for the Northern Colorado Business Report. He can be reached at 970-232-3147 or at sporter@ncbr.com.

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