Dylan Anderson/Steamboat Pilot & Today
Peak Health Alliance took its pitch to Routt County community stakeholders last Thursday, trying to convince them to support the group as it tries to bring lower cost health insurance options to the Yampa Valley.
Created in 2018 in Summit County, the health care purchasing cooperative is looking to expand to offer plans in partnership with a health insurance provider in Routt County, hoping to offer plans starting in 2023.
But first Peak needs to build community support — the first step in its process that they say has brought promising results in seven other Colorado counties that all saw rate reductions in 2021, some as high as 38%. One of those is nearby Grand County, which first offered Peak sponsored plans this year and saw an estimated $200 in premium savings on some plans offered on the individual market.
“We are here because health care costs too much in Routt County,” said Commissioner Beth Melton. “This is something that a lot of us have had on our minds for many years, and the model of Peak really presents a unique opportunity.”
The meeting Thursday included local human resources directors, representatives from local health care providers and some government officials and was meant to explain how Peak works and what needs to happen for it to successfully enter the local market.
Peak’s model gathers claims data and then works to renegotiate fee schedules with providers and hospitals and then take those lower costs to insurance companies to create a Peak sponsored plan with lower premiums.
Buy in from local providers is a crucial part of Peak’s ability to lower premiums.
Despite the promising results elsewhere, Peak has not always been successful at offering plans, mainly because some local hospitals have not bought in. An effort in Garfield County ultimately failed earlier this year when local hospitals stopped communicating with officials who were working with Peak.
After an hour-long presentation from Peak CEO Claire Brockbank to the group, the self-proclaimed elephant in the room spoke up to share her concerns.
“As Claire said, part of the process is dancing around the elephant, and I am the elephant,” said UCHealth Yampa Valley Medical Center President Soniya Fidler.
Fidler said she likes to say that health care is the only service that someone receives without knowing how much it is going to cost beforehand. But she says she has added to that remark, as health care is the only service a business provides without knowing how much they will be paid for it as well, if at all.
The hospital has taken many steps to lower costs locally, Fidler said. She pointed to a joint venture that opened up an outpatient surgery center and opening of an urgent care center, both of which are less expensive forms of care.
Fidler said the community is fortunate to have the level of services they do locally and services they offer that are profitable allow them to offer a wider range, including some that often are not found in rural areas.
“My concern that I shared with Claire is exactly that. What does this negotiation bring and will I be able to sustain and maintain a profit margin that allows us to do those things?” Fidler said, emphasizing the costs of paying staff competitive wages and keeping up with equipment and capital upgrades.
When Peak started in Summit County, the hospital there was charging about 850% the rate Medicare did, Brockbank said — much higher than YVMC. Fidler said the hospital’s rates are between 190% to 290% the rate of Medicare, a common but imperfect metric used to compare costs of care among providers.
“Yes, I definitely agree that we need more options as far as more affordable insurance premiums. We definitely need to continue to work on lowering cost of care but without jeopardizing the quality of care,” Fidler said.
Brockbank said Fidler has been very open and receptive so far, something she called an “ideal scenario.”
“Your hospital’s percent of Medicare has been going down, and that is a real testimony to a lot of work,” Brockbank said. “I actually, when we first looked at that data, expected to see more downward trend in premium.”
Brockbank said she has not seen a reduction in premiums that she expected to see based on some of the rates the hospital is charging, but it is still early in the process. While hospitals have been a roadblock in the past, Brockbank said they have also had a really collaborative process with some hospitals that ended up significantly lowering premiums.
It could be that there is a lot of care that is leaving the county for more expensive providers, Brockbank said, but it is too early to know now.
Melton said the county has committed to pay about $25,000-$35,000 for an actuarial analysis Peak will produce about local costs. If the process would progress to the next phase, Peak would get about another $25,000 for their work, though there isn’t a clear funding source for that yet.
For the rest of the year, Peak will focus on gathering data and having discussions with the hospital. Early in 2022, stakeholders will need to decide whether to pursue getting a plan on the market for the start of 2023. Before the end of the year, Brockbank said they plan to form a steering committee and a provider advisory group that will help decide whether to take that next step.
“I’m not as anxious about what’s happening here with the hospital as I was when we started in Summit,” Brockbank said. “Still, something is happening. There’s a disconnect because you guys have really high premiums. I’ve got to figure out if there’s something we can do to address that.”
To reach Dylan Anderson, call 970-871-4247 or email danderson@SteamboatPilot.com.
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Peak Health Alliance makes pitch to local stakeholders, hopes to offer plans by 2023 - Steamboat Pilot & Today
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