Small businesses rarely provide health insurance to their employees, and the reason is simple they just can't afford it. Those small business who can afford provide some type of insurance, are offering less and less coverage as costs soar.
"This situation has become critical," said Kyle Revelle, owner of Moffat Insurance Agency, Inc. "In this area, we are down to two providers, one being a provider with a limited network. With Humana leaving effective Feb. 24, we now only have Anthem Blue Cross/Blue Shield or United Healthcare left to choose from."
There are only 18 insurance companies in Colorado, down from 85 five years ago, making getting affordable and adequate health care insurance in rural areas especially difficult. As the insurance companies leave, small businesses are forced to pay higher premiums for less coverage.
"Right now, it costs more to cover 15 employees under one plan, than it does to buy 15 separate policies. It's sort of a catch-22 and is definitely a problem," said Dave DeRose, owner of Masterworks Mechanical. "In a business, you usually get a break for buying in bulk. In plumbing, for example, if you buy 15 toilets, you would get a deal because of the amount purchased."
But the opposite is true with insurance for small companies, and the problem is only getting worse, DeRose said.
"It's a real problem, but I haven't figured out how to solve it for my own business, so I don't know how to address it," DeRose said.
A possible solution, he said, could be to expand worker's compensation programs for small businesses to include health care and other benefits.
According to DeRose, it would be affordable and offer good coverage, while the cost would only be 20 to 30 percent above what worker's compensation currently charges workers and businesses.
House Bill 1374, sponsored by Lola Spradley, R-Pueblo, is built to address the problem of providing insurance to the employees of small businesses.
"This issue is a major one for the area and all over rural Colorado," said Tim Jackson, Director of Colorado's branch of the National Federation of Independent Businesses. "The Western Slope is really 'ground zero' on this subject. The bill passed its second reading on Thursday. The third reading on Monday is expected to pass overwhelmingly."
The bill addresses two major factors that affect rural healthcare coverage and the market for it, Jackson said.
The first part deals with the network restrictions on coverage. HB 1374 would allow carriers to offer plans in rural areas without having to have every kind of medical specialist covered.
The plan would allow for the use of treatment providers outside a of a carrier's network, and the carrier would cover "usual or customary charges," while the patient would be responsible for the balance, Jackson said.
"This increases choice in the marketplace, attracting more carriers to rural markets and holding down costs," Jackson said.
The second component would allow insurance companies to fluctuate the rates for small companies based on the health of the owner and employees.
"This problem is not specific to Colorado, but it is compounded in rural areas. Right now in Colorado, there are more uninsured people than insured in the small group market," Jackson said. "The goal of the legislation is to create an attractive market so insurance carriers will return, giving more choice and better prices to small businesses looking for coverage," Jackson said.
If the bill passes the house, it then moves onto the Senate, where opposition is stronger.
The Senate killed a similar bill in February. Concerns over how much a patient could be charged under balanced billing and how rate fluctuations based on health history, could lead to bias against employees and defendants with a history of health problems still remain.
"The network restrictions component I see as being able to pass, but the rate flexibility part doesn't have as good of a chance," Jackson said. "I see this as incremental legislation, building toward a healthier market. It's economically healthier to have more Coloradans insured, for both the patients and providers."
According to Revelle, this legislation could make a big difference.
"We need to foster competition, bring more insurance companies into rural areas to expand coverage and keep rates reasonable," he said.