Health insurance is something we don’t like to think about until we need it. And then we want it to pay for what we need. Unfortunately, life is a lot more complicated than that. Health insurance premiums have become increasingly unaffordable for many businesses and individuals while deductibles and copayments continue to rise. How did we get here?
The United States stands out among industrialized nations for relying on private health insurance to cover the working-age population. This came about because of an historical quirk: During World War II, employers weren’t allowed to raise wages, so they offered health insurance as a perk, and it grew into an expectation. But as health care advanced and people used more services, its cost increased faster than inflation. Nationally, health insurers and health care providers began consolidating and raising their prices without a corresponding increase in the quality of care.
Letting people go without health insurance is a gamble. Life deals out undesirable surprises like a car accident or a cancer diagnosis. Medical expenses are a leading contributor to bankruptcy. In a tight labor market, businesses that offer health insurance will have an advantage in hiring and retaining talent, as well as enjoying the benefits of contributing to a healthy and productive workforce. Yet, some businesses find themselves hard pressed financially to offer this benefit.
To address this need in our community, the Local First Foundation teamed up with Peak Health Alliance to make more affordable health insurance options available to businesses and individuals in Southwest Colorado. Peak is a nonprofit purchasing cooperative that puts our local communities in charge and helps us keep our dollars local. With the participation and support of health care providers, including Centura Health and Animas Surgical Hospital, our efforts have saved almost $4 million for residents of Southwest Colorado, contributing to a stronger local economy.
The state of Colorado has also taken steps to make health insurance more affordable. A state reinsurance program reduced premiums for individuals and families, who may also qualify for federal premium subsidies (advanced tax credits) under the Affordable Care Act by enrolling through Colorado’s health insurance exchange, known as Connect for Health Colorado.
Businesses can take advantage of the state’s reinsurance program by offering Individual Coverage Health Reimbursement Arrangements. Through an ICHRA, employers put money into accounts their employees can use to buy a health insurance policy of their choice. Unlike traditional group insurance, in which the business owner picks one health plan for everyone in the group, employees with an ICHRA get to pick the plan that works best for them.
It’s not too late for local businesses to begin offering an ICHRA to their employees. Peak Health Alliance has certified several local preferred brokers who can educate business owners about the best option for their situation. Businesses that already offer traditional coverage might want to check out the ICHRA option as a way to offer more affordable, flexible benefits for employees.
You should shop for health insurance just like any other product. Compare your options on Connect for Health Colorado. Open enrollment for individuals and families begins Nov. 1. Those undergoing a “life change event” can enroll immediately. Find out more by visiting the Peak Health Alliance website (www.peakhealthalliance.org) or contact me at doug@local-first.org.
Doug McCarthy is a health care advocate and interim executive director of the Local First Foundation.
