Paul Hebert: Financial boon possible with Amendment 69
September 16, 2016
I have been doing some research and analysis of the potential financial impact of Colorado Care on entities in Routt County. Although the research is not yet complete, we have data on six public institutions and 13 businesses and non-profits in Steamboat Springs. The results and conclusions thus far should be of interest to voters.
• Six public entities in Routt County, including the city of Steamboat Springs, Routt County government, the three school districts and the town of Oak Creek together will save more than $7 million per year for health coverage of their employees with Colorado Care compared to what they currently pay.
• The analysis shows that employees of these organizations who have dependents, and who must contribute premiums for these dependents, will save somewhere between $5,000 and $13,000 annually per family on insurance premiums and deductibles. When you multiply those savings times the number of employees in the six public entities (648 in the school districts, 534 in Routt County government, 320 in the city of Steamboat and 11 in Oak Creek), you can quickly realize there will be savings in the millions of dollars that these families will have available to spend locally.
• Businesses and nonprofits that currently pay toward health insurance for even a few of their employees will also save on health care coverage with Colorado Care. The savings vary with the size of the organization, and the number of employees covered. For five entities so far in this category, the savings vary from $4,000 to $20,000 annually.
• The savings to our local hospital, based on my review of data from public records, will be over $3 million.
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• Businesses and other organizations that do not currently provide health insurance for their employees will, in most cases, pay more with Colorado Care, since now the only coverage provided by the employer is the mandatory workers compensation insurance, 59 percent of which covers health costs. To date the six entities in this category will pay more from $1,200 to $52,000 annually.
These numbers appear to be consistent with economic analyses of Amendment 69, which indicate that some businesses will pay less and others will pay more. About 80 percent of individuals and every public entity in the state will pay less.
The savings for entities in Routt County, rather than being devastating, are likely to be a boon for our local economy, our school system, our city and towns and for our local businesses. People will simply have more money to spend in restaurants and retail stores.
It is true that Amendment 69 reshuffles who pays for health insurance for employees and families. Historically, our largest corporations have shouldered the burden while using health insurance to attract and retain employees. Sectors, such as restaurants and retail businesses that had no trouble attracting a sufficient number of employees, did not offer health insurance as an incentive.
Now times are changing. We want universal health care. The entrenched system we have is difficult to massage into a different animal. If our system had not evolved the way it did, with some employers offering health insurance and others not, we would have a level playing field for making changes.
Now with Amendment 69, we will have a new level playing field, but some will have a little pain getting there. Many will save, and a few will lose. The economists who worked on the financing system for Colorado Care knew this reality but could not change it. Operational and policy adjustments can be made in implementation.