Affordable Care Act fails to lower rural health care costs

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Money flying out of a wallet Health care costs have never been considered economical in rural communities, but the divide between rural and urban costs have only been exacerbated by the Affordable Care Act.

"We've gone from letting the insurance companies use a pre-existing medical condition to jack up rates to having a pre-existing zip code being the reason health insurance is unaffordable," Colorado rancher Bill Fales told the Associated Press. "It's just wrong."

Like others living in rural areas, Fales has seen his monthly premiums skyrocket by 50 percent to nearly $1,800 per month.

Insurance officials argue that geography is just one of the three determinants used by insurance companies under the federal health care law to set premiums. Other insurance price zones on the most-expensive list include rural areas in Georgia, Nevada, Wisconsin and Wyoming.

Robert Zirkelbach, a spokesman with America's Health Insurance Plans, a Washington, D.C.-based industry group, explains that the cost differences between densely and sparsely populated areas shouldn’t be considered a shock: it is simply more expensive to deliver health care in rural communities were fewer doctors, specialists and hospitals are stretched thin by the aging rural population and the inherent dangers surrounding farming.

According to USDA data, there were 42,000 work-related injuries reported in 2009. The Centers for Disease Control and Prevention shows that in 2010, 476 farmers and farm workers died as a result of a work-related injury, incurring a fatality rate of 26.1 deaths for 100,000 workers.

And when it comes to saving lives, proximity to health care can mean the difference between living and dying, and in rural areas, that isn’t always possible.

"In rural areas, it's common that you are seeing transport times of over half hour to an hour to a trauma center," Dr. Sage Myers, a pediatrician and researcher at the University of Pennsylvania said, noting that in South Dakota, there are just one or two trauma centers covering the whole state.

Read, “Is city life safer than rural life?”

Some states do have an option to reduce the premium divide between urban and rural areas. They can set a single statewide rating zone, reducing premiums to rural regions by shifting costs onto more-populated areas in the state. Just six states – Delaware, Hawaii, New Hampshire, New Jersey, Rhode Island and Vermont – chose a single rating zone.

There's always been geographic variance in insurance," said Craig Garthwaite, an economist at Northwestern University's Kellogg School of Management who has studied the economic consequences of the new health care law.

The difference now, he said, is insurers have fewer levers to adjust premium pricing. Garthwaite also said the health care law makes it easier for rural health insurance shoppers to see what city residents are paying.

"That's forcing them to confront the market, which is a new thing," he said.

Click here to read “Rural residents confront higher health care costs.”

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MN  |  April, 03, 2014 at 08:38 AM

When I learned that insurance companies are limited to deciding rates by region, I wondered if this is something that rural communities would look at as a selling point to newcomers. I guess if I was a Chamber of Commerce member, I'd be looking at proactive ways our communities (collabortively with others in their region or even the local hospitals) could offer healthy living programs or initiatives to help manage those costs and see if there is any long term benefit to your community by initiating something. Some larger companies have wellness would be like a community or county wide one....

Nevada  |  April, 03, 2014 at 10:56 AM

Rebecca.....I think you missed the point. This has nothing to do with health in rural areas. Health care supposedly costs more in rural areas - probably because there is very little competition - so insurance companies use this as an excuse to charge rural customers more. They are using anything they can to charge customers more because they can no longer charge more for preexisting conditions. It's great for the percentage of the population that couldn't get insurance before, but they rest of us a pretty much screwed.

OH  |  April, 03, 2014 at 09:24 AM

I live in rural Ohio. My health insurance premiums dropped by 54%. $5,376 per year less for coverage for just me. My prescription dropped by $25. The ACA was the best thing that could happen for me. Anthem was screwing me because I had a preexisting condition and couldn't leave them so they kept jacking up my rates.

Richard Gorder    
Wisconsin  |  April, 03, 2014 at 10:16 AM

ACA only works for people who have pre-existing conditions. It discriminates against people based on where they live. It is a pure political attack on the Red states that didn't support the current administration.

SD  |  April, 04, 2014 at 03:44 PM

Rural areas are getting a multiple 'whammy' from the ACA. First/worst, the political shennanigans manipulating policies and benefits, then the pre-existing fact of long distances and population sparsity in areas. Most especially in areas considered "beyone rural", which I believe includes all of SD, for instance. It simply is very costly to provide medical facilities and personnel in such areas, and distances to travel to facilites with equipment and adequate personnel to treat the more serious medical needs, whether from health issues to accidents. A factor also harming us is that we very often have to use volunteers to raise money to build hospitals, clinics, nursing homes, and such, as well as to fund needs for any 'frills' such as sprinkler systems, for instance.

April, 07, 2014 at 08:45 AM

Obama played right into the hands of the insurance companies. We are now forced to deal with insurance bureacrats and are left entirely at their mercy. And insurance companies have no mercy. Obamacare does nothing to bring the cost of health CARE (which occasionally we all must access) under control and it does nothing to control the cost of health INSURANCE premiums (which we now must all purchase or be punished as criminals). All of us out here in rural America have been given just one more good shafting by Obama and his urban/suburban anti-agriculture cabal. Once they have us farmers battered down enough Obama & crew can start gentrifying our wider rural spaces in earnest, just like they've done with suburbs.

Craig A. Moore    
Billings, MT  |  April, 07, 2014 at 11:58 AM

Articles like this prove my point that I have had for years on the ACA. All it does is guarantee that you can get health insurance, and demand that you have it. It DOES NOT guarantee you any health care at all, and in some instances it reduces what you had before it came along. Where are all the doctors and nurses coming from to take care of all the poor downtrodden that finally get insurance, and don't have to pay their fair share?

SD  |  April, 19, 2014 at 11:46 AM

Mr. Moore, won't it be the very same doctors currently treating them? The site may change from the current use of emergency rooms as 'primary care' centers currently taking place, at least in many rural areas, and move those patients to the usual clinics at considerably less cost than emergency room care. It will even have the benefit of freeing up emergency rooms to more quickly treat true emergency cases!!!!


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