Auto Insurance Quote | Legislator trusts interstate medical coverage choices could abridge costs

OKLAHOMA CITY — Starting next year, some Oklahomans may see relief from soaring health insurance premiums thanks to a legislative proposal allowing residents to shop for policies across state lines.

State Rep. Lewis Moore, R-Arcadia, who is the author of the legislation, said he hopes the move will increase competition, which in turn will drive down many Oklahomans’ health insurance costs.

He said his measure, which is still being vetted by his colleagues, is written to ensure that consumers here would receive at least the same level of coverage mandated under state law, but preferably at a cheaper price.

Oklahoma used to have dozens of health insurers, but today that number has dwindled into the single digits in part due to the struggle to incentivize younger, healthier populations to enroll, Moore said. Younger enrollees typically help offset the costs of insuring the state’s older, sicker population. And, Oklahoma traditionally has one of the least healthy populations in the country, he said.

“Just because they take you doesn’t mean they have to take you for the lowest possible premium,” he said.

Moore said he has constituents paying as much as $1,200 a month for individual health policies. In addition, he said those Oklahomans face deductibles as high as $6,350 that they must pay to receive medical treatment.

By allowing Oklahomans to shop for interstate policies, Moore estimates the average Oklahoman could pay as little as $100 to $200 a month for coverage.

Not a ‘silver bullet'

Unlike most other insurance products, Oklahoma law currently requires that health insurers first be classified as an Oklahoma business in order to sell, insurance officials said. Moore’s measure proposes lifting that requirement and allowing companies that have proper state licensing and products to sell.

“We support it,” said Buddy Combs, the state’s deputy insurance commissioner. “We think it might be able to provide a little bit more competition and choice for our consumers. (But) we don’t think this is the silver bullet that will cure all of our health insurance problems.”

At least in the short term, the proposal would most likely affect the estimated 40,000 to 45,000 Oklahomans who have opted to purchase individual private policies — independent of the state’s federally facilitated health exchange, Healthcare.gov, Combs said.

The state’s 130,000 Oklahomans enrolled through Healthcare.gov — many of whom rely on federal subsidies to offset their insurance costs — wouldn’t likely be able to take advantage of the proposed change because those subsidies can’t be used off the health exchange, Combs said.

Those participants saw their rates spike 76 percent this year, he said.

Meanwhile, insurance officials note that there’s been a very low utilization of the health exchange even as high numbers of uninsured Oklahomans remain.

According to recent U.S. Census data, an estimated 1 in 6 Oklahomans under age 65 currently do not have health insurance.

“Probably the biggest driver is price,” Combs said. “I think it’s a function of people not being able to afford the insurance, and that problem is not getting any better.”

Considering Oklahoma’s ongoing health struggles, lawmakers are also uncertain whether out-of-state insurers would even want to sell policies in Oklahoma.

Oklahoma ranks as the 46th healthiest state in the nation, Moore said.

He also said officials need to ensure that state regulators have the authority to step in and enforce punitive damages if an out-of-state company isn’t paying claims promptly or following state law.

Some skepticism

Another potential issue would be incentivizing out-of-state insurers to set up networks of physicians and providers within the state, said state Senate Minority Leader John Sparks, D-Norman. By the time an insurer puts in the work, he said, they might as well just open up for business in Oklahoma.

While Sparks said he doesn’t see any harm in passing the measure, he’s skeptical it will actually work as intended.

“When you get down to it, I don’t think that’s going to work,” he said. “The places where it’s been implemented, there’s not a lot of sizzle there. But, I don’t see a downside, and so if somebody wants to try it, maybe they can put a new twist on it and it can work.”

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