EDITORIAL
THE PUEBLO CHIEFTAIN

WE WERE disappointed that Gov. Bill Owens vetoed legislation that would have set up a study to determine why health insurance prices have been so much higher in Pueblo than elsewhere around the state.

SB11, sponsored by Sen. Abel Tapia and Rep. Dorothy Butcher of Pueblo, would have required the Colorado Division of Insurance to conduct a comprehensive study on the factors that drive prices for health insurance here. Lawmakers from other parts of the state and of both parties were concerned about the inequities faced by Puebloans and supported the bill.

There is a history in this.

In 2001 the insurance industry announced it would cherry-pick, charging dramatically higher premiums for state employees living in Pueblo County than in any other county. That made for the absurd situation whereby the premium for a state employee who lived in Pueblo but worked at a prison in Fremont County would be higher than for a state employee who lived in Penrose and worked at the state hospital. State Personnel Director Troy Eid subsequently refused to allow insurers to bid on Pueblo state employees separately.

That’s a practice known as red-lining. The state previously tried to divine just how these rates were reached, only to be blocked by insurance companies which refused to disclose “proprietary” information about themselves and how they determine rates.

While Pueblo admittedly has an aging population and a high percentage of people with poor health, the City and County of Denver has a similar demographic makeup, with an aging population and a large percentage of poor minorities with health problems. The difference is that Denver premium rates are socialized across the entire metro area, meaning that the higher costs of health care in Denver are spread to the more affluent suburbs.

So businesses enjoy lower rates in Denver, thus encouraging more economic development, while higher rates in Pueblo can be detrimental to economic development.

In his veto message, Gov. Owens said rates for health insurance across Colorado have fluctuated for years. We’ve yet to see any decreases in Pueblo.

He added that “many insurers have been decreasing the Pueblo area rate factors in recent filings.” While this may be true, the methodology insurers use to set their rates is anything but transparent.

We’ll wait to see what happens to rates in Pueblo during the next year. It may be necessary for the Legislature to try the study approach once more.

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