Combating the high cost of health insurance in Colorado mountain communities
Kaiser Permanente’s Brent Bowman in front of the new Edwards office.
A bipartisan bill to study geographically leveling the playing field for health insurance customers in Colorado’s mountain resort region passed out of the state House Committee on Health, Insurance and Environment last week but faces an uncertain future on the full House floor and in the Republican-controlled Senate.
HB 1336 (pdf) would direct the Colorado Division of Insurance to study the feasibility of changing the current system of creating risk pools based on geographic regions under the Affordable Care Act. The state agency would be required to complete its report by Aug. 1, meaning changes could then be implemented by 2017 and rates then might come down.
Health insurance rates for self-employed workers and people unable to obtain insurance through their employers have skyrocketed in recent years, and Western Slope lawmakers have been grappling with a variety of strategies to combat the problem in a region where healthcare providers can be scarce or they charge inflated rates due to the high cost of living.
Avon mortgage broker Chris Neuswanger started a website called “Equalrates.com” to track the bill’s progress and advocate for its passage. It’s sponsored in the House by Summit County Democrat Millie Hamner and Carbondale Republican Bob Rankin and in the Senate by Durango Republican Ellen Roberts and Vail Democrat Kerry Donovan.
“We need to find out what’s truly driving costs,” Donovan told the Vail Daily last week. “We aren’t all rich second-home owners. We need to overcome those perceptions.”
Roberts told Real Vail in January that she would target the high cost of healthcare on the state’s Western Slope this legislative session. She primarily blames the Affordable Care Act, passed by Congress in 2010. The Denver Post ran a story in January pointing to a variety of factors for the 25 percent increase in health insurance rates between 2015 and 2016.
One factor in the overall increase in health insurance costs may be the runaway spike in the prices of pharmaceutical drugs. Legislative efforts to shed light on those costs were shot down in committee earlier this session.
As for the lack of providers, Eagle County at least should become increasingly competitive with the addition of Kaiser Permanente in Edwards and Centura Health in Avon. Real Vail spoke to those providers and a local health insurance broker for the following story that ran in the winter 2015-16 issue of The Parents Handbook:
Young families battle the runaway cost of healthcare in Eagle County
Everything in the Vail Valley costs more than other parts of the country. It’s an expensive place to visit, and it’s a very expensive place to live. Locals will tell you it’s the cost of calling paradise home, and many local families feel it’s well worth the extra expense to avoid the stress and insanity of living in the big city.
But full-time residents of Eagle and Summit counties will often go to extremes to avoid paying premium prices for everything from gas to groceries to healthcare. That may mean driving on fumes all the way to Denver, going without groceries until you can make it to Costco, or heading all the way to the Front Range for medical procedures that can cost a lot less in the city.
As more and more people move to the Vail Valley, retail options have expanded significantly, so working families now have a Costco in Gypsum that charges Denver prices for gas and other necessities while ‘up-valley” grocery stories still charge top dollar, especially during ski season.
Healthcare, however, remains a very pricey proposition. If you’re not on a good company health plan, it can be very expensive to get basic healthcare in the Vail Valley. Part of it is the higher cost of living for healthcare workers and the expensive real estate facilities operate on, but mostly it’s the seasonality of the local economy and the basically rural nature of the area that doesn’t provide a large enough and consistent enough pool of patients. Those factors have contributed to a lack of competition over the years.
All of that is starting to change in 2016, with two major players in the healthcare arena moving into or expanding their presence in the mountain ski-resort markets. Starting in January, Kaiser Permanente will open new offices staffed with physicians and nurses in Edwards and Frisco. And next summer, Centura Health, which already operates the St. Anthony Summit Medical Center in Frisco, will open up in the new Buck Creek Medical Plaza in Avon.
All of this is occurring as the Vail Valley Medical Center, the dominant healthcare provider in the Vail Valley for 50 years, is expanding its Vail campus. The question, of course, for readers of The Parents Handbook, is how all of this expansion and competition will impact the cost of medical services in the Vail Valley, and whether it will in any way lower sky-high insurance rates. The answers to those questions may take some time to fully sort out.
Kaiser offers insurance option
Non-profit Kaiser is unique among the current players because it’s both an insurance company and a care-delivery system, albeit one that is in its very nascent stages. New offices will be located in the Edwards Corner building in Edwards and near Whole Foods Market in Frisco.
“In terms of what we’re going to be able to offer families, number one we think is an affordable option for health insurance, and along with that comes the care-delivery system,” said Brent Bowman, Kaiser Permanente’s executive director of the mountain Colorado service area. “In the Edwards medical office building specifically, we will have the ability to see members of all ages, including children.”
In November, Kaiser inked a deal with one of the largest medical groups in the valley, Colorado Mountain Medical, a network with 26 doctors, three physician assistants and one nurse practitioner. CMM will offer primary and specialty care services to Kaiser members starting in January, and those specialties include everything from cardiology to urology.
That’s a big plus for local residents weighing insurance options during the hectic December sign-up period. Kaiser is one of the most competitive insurance options, but there was a concern that new members in the mountains would have to travel to Denver or elsewhere on the Front Range for many services until Kaiser increases its physicians and specialty offerings locally.
A family of five making $95,000 a year in Eagle County can get health insurance from Kaiser for $1,194 a month compared to $1,408 a month from the next cheapest option, for-profit Anthem (Blue Cross Blue Shield), according to Eagle insurance broker Bethe Wright of The Wright Insurance Company. That family would then qualify for a $743-per-month tax credit under the Affordable Care Act, bringing their monthly payments down to $451.
Kaiser conducted an extensive study using in-person interviews of local residents and businesses last summer that found healthcare costs are prohibitively expensive for mountain dwellers.
“We learned there are the people there who have two homes and the people there who have two jobs,” Bowman said, “and we’re focusing more on the people who are the full-time residents there, making a living and making it work in a very challenging environment from a cost-of-living standpoint.”
Kaiser, which has had talks with the Vail Valley Medical Center, says it will continue to try to partner with local healthcare providers while expanding its virtual visits program that allows patients to conference with physicians locally and elsewhere in the state using video.
“We want to be able to offer the choice to be able to see a local provider but we also want to be able to make it as easy as possible for you to leverage the care and capabilities of physicians on the Front Range,” said Bowman, who in addition to video visits and an on-call nurse who can answer questions 24/7 also touted the company’s online capabilities that allow patients to manage their care and prescriptions through mobile apps.
“The local community has been really receptive to seeing another option because people are astute enough to know that if more options are available, that’s going to help create over time a more competitive market for the price of care to come down,” Bowman said.
When the new offices in Edwards and Frisco open in January, they will be open during normal business hours Monday through Friday. Eventually, they’ll be open until 7 p.m. one night a week and one Saturday morning a month for a few hours.
Emergency options in Avon
The new three-story, 48,500-square-foot Buck Creek Medical Plaza in Avon, which is slated to open in July or August depending on how construction progresses, will house a 12,000-square-foot emergency department on the first floor, with parking in a garage beneath the building.
Being built by medical-facility developer NexCore, Centura is master leasing the first and third floors, with the developer leasing the second floor to medical providers as well. Specialty services will be added as Centura gauges local needs, according to St. Anthony CEO Paul Chodkowski. The first-floor emergency department will include both urgent care and an ER, and both will operate around the clock.
“What’s wonderful is you’ll have first floor, easy access, walk-in service, 24-7 to both levels of care, and we’ll have board-certified or board-eligible emergency physicians staffing it, so that’s a very high level of capability,” Chodkowski said, adding the department will also have a CT scanner, general X-ray imaging and ultrasound.
Someone with a broken arm can utilize the ER, while a child with a high-spiking fever might be able to go to urgent care at a significantly lower cost, he added. All of this will be located next to the new Avon fire department in an area that’s right off Interstate 70 in the mid-valley region, as opposed to the Vail Valley Medical Center’s ER, which is located on the east side of Dowd Junction farther away from where many local residents live.
“We saw it as an unmet need for this kind of comprehensive service, and we thought that we could bring to the community some benefits in terms of options and lower costs at a very high level of service,” Chodkowski said.
Because it doesn’t have its own insurance product like Kaiser, Centura has to work with and offer discounted services through local insurance providers, Chodkowski said. However, he acknowledges the high costs of healthcare in the high country, so another tool Centura is using to lower costs is direct-employer contracting for self-insured companies or organizations.
In Summit County, Centura works with the county, the school district, Arapahoe Basin ski area, the town of Frisco and others companies to provide healthcare at lower costs by eliminating middle-man fees. Centura hopes to do the same as it moves into Eagle County next summer.
“We have our resort community and our guests, and then we have our local community and our local residents,” Chodkowski said, “so while healthcare is very seasonal and we do have high pricing to make up for that seasonality, we hope that through some of these different types of insurance products and direct employer relationships we can bring down our costs, particularly for our local residents.”
That will likely take time and may not be as significant as some locals would hope, according to insurance broker Wright.
The high cost of health insurance
Wright says it was a huge blow to mountain-dwellers when the Colorado Division of Insurance shut down Colorado HealthOP in October, especially for Summit County residents. Colorado Mountain Medical was close to signing a deal with HealthOp but instead had to go with Kaiser. The prices for Eagle County residents wouldn’t have been much better than Anthem, but it would have been another option. HealthOP offered much lower rates in Summit County.
Now that Anthem and Kaiser are the two primary insurance options in Eagle County, Wright says it’s important to know as much as possible about what each insurance product covers and what services and healthcare provider networks are available under your plan.
Under the Affordable Care Act, 100 percent of wellness for children and adults is covered, and for children under 19, pediatric dental and vision is also covered without having to buy a separate policy. Many people don’t know all of that, just as many people don’t know about the tax credits, Wright said.
“That’s valuable information for people to have, because most people if they hear $1,400, they’re just going to shut down and say, ‘You know what, we can’t afford it,’” Wright said. “[With the IRS credit] a family of five would be paying $650 or less, which really isn’t a lot of money when it comes to unlimited millions and millions of dollars of coverage – that kind of protection.”
Under the ACA, Colorado was one of the states that expanded Medicaid benefits, so people can qualify for Medicaid and kids can be put on CHP Plus, Wright added.
“There’s a lot of help out there people don’t know how to get to, and that’s the thing that we need to educate people about,” Wright said, adding licensed local insurance brokers, who can be found on the state Connect for Health Colorado insurance exchange website, can walk people through their options free of charge.
“People need to know that using a broker does not cost them any money,” Wright said. “It doesn’t cost any more to go through me than to go direct to the carrier or direct through Connect for Health Colorado. The broker gets paid by the insurance company.”
And if you’re extremely unhappy with your insurance company, another benefit of the ACA is that even people with chronic illnesses can switch to a different carrier each year when they re-up their insurance
Go to Connect for Health Colorado’s website for more information at connectforhealthco.com or call The Wright Insurance Company at (970) 328-6300 or email bwright@vail.net.
New and improved VVMC
Finally, Vail’s main hospital for 50 years began an ambitious expansion project over the summer that will eventually relocate the Vail hospital’s main entrance and ER to South Frontage Road, taking approximately 1,400 vehicle trips a day off West Meadow Drive.
That street is a key connector between Vail Village and Lionshead, and the hospital expansion allows it to stay in the heart of Vail while solving a major traffic issue for the town. Experts agree it’s vital to have an ER at the base of one of the nation’s busiest ski resorts, but it’s been challenging to expand and upgrade services on such valuable land in a relatively tight space.
The expansion, which kicked off construction on the east wing last summer while maintaining services in the west wing, allows the hospital and its world-renowned orthopedic partner, the Steadman- Philippon Clinic, to stay in Vail.
“Most importantly, the hospital is a $30 million contributor to the Vail economy and our second largest employer, and the efforts that they’re taking to remain in the town of Vail shouldn’t be overlooked,” Vail Community Development Director George Ruther said.
Former Vail Mayor Andy Daly added the expansion and redevelopment allows the VVMC and the Steadman Clinic to continue to be a global leader.
“For the hospital it really charts its future for the next 20 years, and it’s a vibrant, exciting future that allows it to be one of the top orthopedic centers in North America if not in the world,” Daly said. “Some of the things the hospital is doing with Steadman-Philippon supporting new stem-cell research to promote the use of joints is going to be very, very exciting and continue to keep Steadman-Philippon and the Vail Valley Medical Center in the limelight for quite a while.”
And for many local residents, whose kids were born at the VVMC or who have gone there for years for a number of family health concerns, the Vail hospital will remain their first choice, even as healthcare options expand down-valley.
Fast facts from Bethe Wright insurance
- A family of five making $95,000 a year in Eagle County can get health insurance from Kaiser for $1,194 a month compared to $1,408 a month from the next cheapest option, for-profit Anthem (Blue Cross Blue Shield).
- That family would then qualify for a $743-per-month tax credit under the Affordable Care Act, bringing their monthly payments down to $451.
- Families of five making under $113,640 are eligible for tax credits under the ACA.
- 100 percent of wellness for children and adults is now covered by insurance, per the ACA.
- Children under 19 have pediatric dental and vision covered without having to buy a separate policy, per the ACA.
- Under the ACA, Colorado was one of the states that expanded Medicaid benefits, so many local families can qualify for Medicaid and their kids can be put on CHP Plus.
- Licensed insurance brokers are listed on the Connect for Health Colorado insurance exchange website at connectforhealthco.com.
- Insurance brokers can walk you through all the options and don’t charge for their services. They are reimbursed by the insurance companies.
- If you’re unhappy with your insurance company and have a chronic condition, you can switch policies every December.
- Go to Connect for Health Colorado’s website for more information at connectforhealthco.com, call The Wright Insurance Company at (970) 328-6300 or email Bethe Wright at bwright@vail.net.
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