Comment on health insurance zones
May 5, 2014
Update May 19, 2013
May 19, 2014 FOR IMMEDIATE RELEASE
U.S. Health & Human Services Approves Division of Insurance Shift on Geographic Rating Areas for 2015
Denver – On Thursday, May 15, the U.S. Department of Health & Human Services (HHS) approved the request from the Colorado Division of Insurance (DOI) to shift from 11 geographic rating areas for health insurance, to nine areas for 2015. The (DOI) made the request on May 9 (5/9/14 News Release “DOI Seeks Shift on Geographic Rating Areas for 2015”).
Geographic rating areas are geographical units made up of metropolitan statistical areas (MSAs), counties or three-digit zip codes, which are used by insurance carriers to price premiums. In moving from 11 areas to nine, the DOI will combine four rural areas into two larger rating areas, while retaining the seven urban areas (or MSAs).
“These larger rating areas spread the risk and costs of health care over a larger population,” said Commissioner of Insurance, Marguerite Salazar. “This is the most equitable way of working towards stable premiums in all regions in the state. The Division thanks the HHS for their prompt attention to this request to help the people of Colorado.”
Because of this change, the DOI has extended its deadline for insurance carriers to provide plans and rates for 2015, from May 15 to June 6, providing time for insurance carriers to adjust to the new areas.
The HHS approved the change through its Centers for Medicaid and Medicare (CMS) and the Center for Consumer Information and Insurance Oversight (CCIIO).
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Update May 9, 2013
May 9, 2014 FOR IMMEDIATE RELEASE
Division of Insurance to Seek Shift on Geographic Rating Areas for 2015
The Colorado Division of Insurance (DOI) today announced it will ask the federal government for approval to change Colorado’s geographic rating areas for health insurance for 2015.
Geographic rating areas are geographical units made up of metropolitan statistical areas (MSAs), counties or three-digit zip codes, which are used by insurance carriers to price premiums.
The DOI seeks to reduce the number of rating areas from 11 to nine, combining four rural areas into two larger rating areas, while retaining the seven urban (or metropolitan statistical areas, or MSAs). Such a change will require approval from the U.S. Department of Health and Human Services.
Consolidating the higher health cost regions into larger rating areas will spread the risks and the costs of providing health care more equitably over a larger population,” said Marguerite Salazar, Commissioner of Insurance. “We understand that people across the state are concerned about high health care costs and the impact on health insurance premiums. This is the fairest way of addressing the issue and working toward stable premiums in all regions of the state.”
The announcement comes after a meeting last week of the Health Care Cost Study Group. At that meeting, the DOI put forth three options for rating areas following presentation of an actuarial analysis commissioned by the DOI for the study group. The DOI invited comments through Wednesday, May 7.
The DOI received 306 comments of which 138 addressed the rating area options. Of those, 117 were supportive of the nine rating areas structure.
As part of this change, on Friday, May 9, DOI will formally request approval from the Department of Health and Human Services to change Colorado’s rating area structure. Due to this change, the DOI also will extend its deadline for insurance carriers to provide plans and rates for 2015 from May 15 to June 6, providing time for insurance carriers to adjust to the new areas.
Citizens only have a short couple of days – until May 7 to comment on options for reworking the geographic rating areas for health insurance.
Garfield County Commissioners considered three options in their meeting this afternoon. The board encourages citizens to comment on an option that involves either two rating zones outside the larger metropolitan areas – one in eastern Colorado and one in western Colorado, or a single statewide rating zone.
The Colorado Department of Regulatory Agencies, Division of Insurance shared the options Friday, May 2, 2014, for the geographic rating areas in Colorado as result of a statistical analysis of healthcare costs across each region of the state. The Colorado Healthcare Cost Study Group has until Wednesday, May 7 to respond. The public can provide their comments on the new options by email at DORA_georatings@state.co.us.
The options include:
- The state is offering two new options. One new option is to combine the existing four non-metropolitan areas into two, an east and west area. Garfield County would be part of the west area.
- A second is to combine all non-metropolitan areas into one area statewide.
- A third is leaving Garfield County, Pitkin County, Summit County and Eagle County in the current resort rating. Garfield County’s rates are combined with the most expensive ones.
Options 1 and 2 would spread the risk more broadly for insurance carriers thus creating lower rates for consumers.
If you would like to read the report, Colorado Total Health Cost and Geographic Study, you can find it here. Consumers with questions about insurance can contact the Division of Insurance at 303-894-7490 or 800-930-3745.
Division of Insurance current information and FAQs
Garfield County Commissioners
Geographic rating zone options
May 6, 2014 comments