Peak Health Alliance CEO Claire Brockbank on her purchasing cooperative’s work

Peak Health Alliance is a Colorado health care purchasing cooperative that works to offer community driven plan designs to its members. It is independent, member-run, non-profit, and operates in eight of Colorado’s counties. Claire Brockbank, the organization’s former lead negotiator and data analyst, now its CEO, spoke with State of Reform about Peak’s history and some of the ways in which it’s making care more affordable for Colorado communities.

“[Peak] was created as a result of years of efforts by the folks in Summit County, Colorado … Colorado has nine Affordable Care Act insurance regions, and Region Nine … had the distinction of being the most expensive insurance region in the country, and Summit was among the most expensive of all the counties in Region Nine.”

She said the Summit County community decided to look at Colorado’s all payer claims database to see what was driving these high premiums. They found the principal driver to be the price of health care. 

“For commercial coverage, the average percentage of Medicare paid for emergency room claims was over 850% … For outpatient care, on average, it was over 500%.”

The community then had to navigate how to approach lowering these prices, which proved difficult without any infrastructure to do so.

“In Colorado — and in many states — it is difficult for individuals, insured groups, [and] employers to actually come together and negotiate insurance if you’re not a trade association or [something similar]. There’s some real barriers, actually, to employers getting to ban together, unless you’re self-funded, in which case you’re not really regulated at the state level.”

Brockbank served on the board for the Connect for Health marketplace — of which she is now chair — at the time, and worked with Insurance Commissioner Michael Conway to develop a plan of action. Through a law from the 1990s, they discovered purchasers in Colorado were permitted to come together for the purpose of negotiating insurance.

This legislation allowed the community to form a purchasing cooperative, and Peak Health Alliance was created. Using seed funding from the Summit Foundation, as well as monetary support from other foundations, Peak began negotiating with Centura’s Summit County Medical Center.

Brockbank said the hospital initially opposed claims that their prices were too high, alluding to their status as a non-profit, faith-based hospital. Peak used community organizing and pressure to work with the hospital and convince them their prices were too high.

“It’s not typical for a hospital executive to ever negotiate with anyone but an insurance carrier — who has a mixed incentive to bring the rates down … And when you’re in a rural area, as Summit Count is … it’s often not as important to a carrier to get great rates there as opposed to getting great rates in more competitive areas like the cities.”

The data at the time showed that 35 cents of the health care dollar stayed in Summit County, and the rest went primarily to Denver. There, Brockbank explained, the rest of the dollar scattered across health systems and hospitals.

Peak proposed designing a benefit plan that would be used for all Centura hospitals and would be centric to the Centura system, meaning the hospital would also benefit from a higher patient volume. The hospital agreed, and, Brockbank said, “to their credit, they really did step forward.”

“So what [the hospital] would capture is not necessarily more of the Summit County business, but it’s that 65 cents on the dollar [that was] going elsewhere … Altogether, we were able to negotiate a very significantly different fee schedule.”

This new agreement also included a prohibition on hospitals providing discounts on bill charges to certain employers.

Since — per the enabling legislation — purchasing cooperatives aren’t allowed to bear risk, Peak solicited bids to carriers to provide their plan design to the small group and individual market in Summit County. They ultimately awarded the contract to Bright Health. Peak received varying premium proposals from carriers, as well as varying perspectives on proposed benefits.

In particular, some mental health providers didn’t want to take insurance because they’re typically not paid enough and there are administrative barriers to mental health providers negotiating with carriers. Brockbank said mental health was a big priority for the Summit community, and they ultimately negotiated to require carriers to cover an established amount for mental health visits. She said it was a “substantial increase” from what was covered before.

They also had to work to contract with mental health providers.

“With mental health, often people have benefits but they can’t find a provider … We have gone from seven therapists [in Summit County] accepting insurance to almost sixty.”

She highlighted the combined positive impact of Peak’s plan design and the Colorado reinsurance program, which both operationalized in 2020. Reinsurance reduced Summit County’s rates by around 20%, and Peak’s fee schedule reduced them a further 20%, Brockbank said.

This success led to other counties asking Peak to help lower their rates as well, and Peak began expanding into other areas of the state in 2021. In the new counties they expanded into — including La Plata county in the southwest and Lake County in the mountain community — rates decreased by around 35%, Brockbank said.

After Peak’s successful first year, Bright recommended that all outpatient therapy have no copay and no deductible. While there would still be an out-of-pocket fee, Brockbank explained this was a win for Peak, and that having a zero-deductible plan on the marketplace was rare because of the ACA’s actuarial value requirements. Peak is the only plan in Colorado with a zero-deductible plan on the individual and small-group market.

To keep care local, Peak negotiated having a flat co-pay for expensive services like MRIs. Since these services are more expensive at smaller hospitals that don’t perform them often, having a flat copay — rather than paying full price until a deductible kicks in at a more urban facility — incentivizes patients to seek care locally rather than somewhere like Denver.

Peak has steering committees for each county it operates in, composed of community members who provide feedback to ensure Peak’s plan designs meet the unique needs of different communities. These committees also lead local outreach and help Peak maintain a strong, local connection.

“One of the thing’s that’s important for Peak is that the people in the communities trust it as a local solution. So even if we partner with Bright Health, which has become a big national player, it feels like a local solution.”