Residents of Telluride have a lot of good issues going for them — world-class snowboarding, jaw-dropping vistas — however entry to a wide range of health care decisions will not be on that record.
There’s just one insurance firm providing health plans in the person market in Telluride’s house county, San Miguel. The closest full-service hospital is 2 counties away. And residents of San Miguel County pay some of the best insurance premiums in the state.
Now, a new report launched Tuesday by the nonpartisan Colorado Health Institute is making clear how the primary two of these components could result in the third. In counties the place there’s much less health care selection, each among insurers and hospitals, health insurance premiums are usually larger, in line with the report.
The institute is looking this its competition matrix, and even simply a fast look at its tic-tac-toe-style chart exhibits the correlation. Within the higher left nook are 13 counties with just one insurance provider on the person market and little hospital competition. Nearly all pay the best charges for insurance. Within the decrease proper are eight counties alongside the Entrance Vary with strong competition among each insurers and hospitals. They pay some of the bottom premiums in the state.
Within the areas in between are Colorado’s remaining counties and a basic pattern shifting towards decrease insurance prices as competition will increase.
“I think that what surprised me — it surprised all of us — was just how strong it was, how strong that correlation between competition and price was,” mentioned Emily Johnson, a director on the institute who spent months growing the matrix.
She cautions, as researchers usually do, that correlation right here will not be confirmed to be causation. There could possibly be different components, just like the relative health of a county’s inhabitants, that additionally play into the equation. However Johnson mentioned the findings align with a commonplace tenet of economics — that competition creates leverage for customers, which creates decrease prices.
The institute’s findings additionally give help to the considerations of health care advocates, who’re more and more fearful that consolidation in each the hospital and health insurance trade are resulting in larger prices for customers.
As an illustration, the report notes that, whereas there are 24 hospitals in the Denver metro space, 20 of these are owned by 4 massive health methods — which have additionally expanded into less-populated areas of the state. And, whereas customers alongside the Entrance Vary usually have strong selection among insurance companies, two of these companies — Kaiser Permanente and Cigna — maintain 75 p.c of the market.
At a assembly final week of the Colorado Enterprise Group on Health — a assortment of employers working to deal with high health care prices — audio system talked ominously of the risks of a consolidated market.
“There simply is no competition in most markets for hospital services,” mentioned David Blumenthal, the president and CEO of the Commonwealth Fund, a basis that research the health care system. “The definition of a market is competition. It doesn’t exist for hospital services.”
The institute’s report suggests 4 methods to deal with the issue, some of which the state has already undertaken.
The state may embolden insurers to leap into doubtlessly dangerous markets by serving to them pay their costliest claims — one thing the reinsurance program that lawmakers accredited this yr would do. Or the state may instantly improve protection choices by providing its personal plan — one thing lawmakers edged towards this session.
The 2 different choices are for the state to be extra muscular in the way it regulates hospital and insurance prices or to encourage innovation in health care supply — corresponding to by means of distant visits with medical doctors by way of cellphone or videoconference, referred to as telehealth, which may convey extra choices to rural customers with out truly shifting extra medical doctors to rural areas.
However Johnson mentioned there is no such thing as a fast repair to the issue.
“Because of the complexity of these markets and variations across Colorado,” she and her colleagues wrote in the report, “it’s clear that solving the state’s competition conundrum won’t be a one-size-fits-all exercise.”
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