Bill could drive up insurance premiums

DENVER - Colorado lawmakers advanced a measure Thursday that could increase car insurance premiums by roughly $200 a year.

The plan seeks to cover the estimated $80 million lost each year by trauma centers and first responders in the state since Colorado switched car insurance laws in 2003.

The Senate Local Government committee approved Senate Bill 193 on a 4 to 3 vote. The measure would require Colorado drivers buy $25,000 worth of coverage for all "medically necessary and accident-related health care expenses for bodily injury" and $25,000 for all "rehabilitation, treatments or occupational training for five years after an accident."

"We never ever want to have to use a first responder, but we most certainly want to make sure they're available," said Sen. Lois Tochtrop (D-Thornton), the sponsor of the bill.

Tochtrop says since Colorado switched from a no-fault insurance system to a tort-based, or fault-based, system in July 2003, first responders and trauma centers have incurred the same amount of costs without the same amount of reimbursement from insurance companies. The lack of prompt payment has threatened emergency services in some areas of the state. Chiropractors, physical therapists and massage therapists also complain about not being reimbursed under the new system.

"Trauma systems are a public good, similar to police departments and fire departments," said Dr. Charles Mains, a trauma surgeon at St. Anthony's Hospital. "The problem with the trauma system is that the reimbursement for them is only there if they put out the fire."

Critics of the plan lamented the measure was introduced and given a public hearing with only a day's notice for the public to attend. They argued a significant policy change like this should be vetted by consumers who are bound to cover the cost if the measure passes.

"By my take, if this passes, you're in essence going to give me a great big pay raise," said State Farm Agent Rick Hayes. "Because premiums will go up, commissions will go up."

A separate State Farm representative told lawmakers their average premium would go up $180 per year if the measure passed. An Allstate representative testified before lawmakers its average customer in Colorado would pay, on average, $200 more per year.

"When I go to the doctor to get any kind of care, I'm fully covered," said Bill Imig, who is a lobbyist for the insurance industry at the Capitol and who pays $115 per month to be covered under Medicare Part F. "I don't have to pay a penny for anything. Why would I want to have to buy medical coverage when I'm already fully covered.”

"The idea of having to force people to buy coverage that maybe they don't need or want or maybe they can't afford, seems to be to be the wrong way to go," said Imig.

The measure now heads to the Senate Appropriations Committee.

For more information about Senate Bill 193, you can click here.

For more information about the Rocky Mountain Insurance Information Association, you can click here.