Health Insurance Alternative Prompts Calls for Protections / Public News Service

State lawmakers are considering a proposal that aims to ensure that Coloradans sign up for health care cost-sharing arrangements to have basic protections.

Isabel Cruz – policy manager with the Colorado Consumer Health Initiative – said under current law, even though members pay hundreds of dollars each month into these programs, there is no guarantee that any of their medical expenses will be covered.

“And many do end up with no other option but to pay incredibly expensive bills entirely out of pocket, or take on crushing medical debt,” said Cruz. “And this is even for services that these programs say that they will cover. There is no guarantee of payment at all.”

House Bill 1269, introduced by Democrats, would require Health Care Sharing Arrangements to submit basic information about their operations to the Colorado Division of Insurance – including how much money they take in from members compared with how much they pay in claims.

Industry groups have argued that since HCSAs are not offering health insurance, they shouldn’t be subject to oversight. A competing bill introduced by Republicans would require less robust reporting.

Cruz noted that HSCAs market themselves as more affordable alternatives to health insurance, and use strikingly similar language – offering gold, silver and bronze plans. She said regulators also need data to determine how HCSAs are impacting Colorado’s health insurance marketplace.

“And provide some transparency,” said Cruz. “And we want to make sure that the state regulators are able to get the information, to really understand what the impacts of these products are on everyday Coloradans.”

Cruz said many Coloradans have reported that they believed they were purchasing health insurance or guaranteed coverage, only to have their claims denied.

After a health provider confirmed before surgery that the cost would be $5,000, one HCSA member got a bill for $70,000.

“We have also heard from people who were pushed into enrolling by brokers who undersold the risk of these arrangements, since they often get high commissions from selling them,” said Cruz.

Disclosure: Colorado Consumer Health Initiative contributes to our fund for reporting on Budget Policy & Priorities, Health Issues. If you would like to help support news in the public interest, click here.

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