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Colorado Health Insurance Exchange
State Health Insurance Exchanges
What is the state health insurance exchange? Why is it important?
The
federal health care reform law that passed in March of 2010 allows the
state to set up and run its own health insurance exchange. Think of the
exchange as a Travelocity or Expedia for health insurance. If the
exchange is built in the right way, consumers and small business owners
will be able to go to one place and easily compare many different kinds
of health insurance plans just as you can use Travelocity or Expedia to
compare flights or hotels. It is expected that the exchange will have
both an internet portal as well as a phone option for people who don’t
use the internet. The idea is that an exchange will make it easier for
consumers to compare plans and make an informed decision about the
insurance they are buying.
In addition to making it easier for people to buy health insurance and navigate the market, the exchange will also, hopefully, help drive down the cost of insurance for both individuals and employers. One of the reasons health insurance and health care costs keep rising is the large number of people who don’t have insurance. Part of what you are paying for when you buy health insurance is for the insurance company to undertake the risk that you will become seriously ill or injured and need lots of expensive medical care. If there are less people buying insurance, the cost of the risk the company is taking is spread out among less people, which keeps costs relatively high. Conversely, the cost of insurance can be decreased when the risk is spread out among more people. Because an estimated 300,000-500,000 people in Colorado will use the exchange, the risk pool of people will be expanded and this will help drive down costs.
The state legislature passed the bill necessary to start building the state health insurance exchange in April. The governing board for the exchange has been appointed and they have begun meeting. The people on this board will be making lots of important decisions in the coming months about how the exchange will be run and your involvement and voice will be important in the process! To stay up to date on what’s happening with exchange, you can visit their website at http://www.coloradohealthinstitute.org/cohiex/board or contact Colorado Progressive Action staff member Hillary Jorgensen with any questions at 303.866.0908 or hillary@coprogressiveaction.org