Alaska can’t afford these health care bills

Health care in Alaska is expensive. Some say the most expensive in the country. And it’s only getting harder for families and businesses to keep up. Now, two bills in the Alaska Legislature, Senate Bills 121 and 122, could make things even worse. They would raise health care costs for nearly everyone with private insurance, without improving access or quality of care.

At Premera Blue Cross Blue Shield of Alaska, we’re very concerned about what these bills would mean for Alaskans.

One network = higher costs for everyone

Some people think these bills would only affect certain types of insurance, like individual plans or small businesses. But that’s not true. At Premera, we use one provider network for all of our Alaska customers, whether they buy insurance on their own, get it through a small business, or work for a large, self-funded employer. That means if these bills force us to pay higher prices to providers, everyone’s costs go up; not just the people directly covered by the law.

SB 121: a step backward

SB 121 would bring back a version of Alaska’s old “80th percentile rule.” That rule said insurers had to pay high out-of-network bills, no matter how inflated they were. It led to huge increases in health care costs, and it was finally repealed last year. After the rule was repealed, access to care didn’t get worse. In fact, our network of doctors and providers grew. That shows we don’t need extreme payment rules to keep providers in the system.

Now, SB 121 proposes a similar rule: insurers must pay providers either the 75th percentile of billed charges or 450% of what Medicare pays, whichever is higher. That would raise costs across the board. We estimate that for a family of four in the individual market, this could mean $5,000 more per year in premiums starting in 2026.

And because we use one network, those increases would hit all of our customers.

SB 122: mandating higher costs

SB 122 would force insurers to include almost every provider in the state in their network, even if those providers charge high prices or don’t meet our quality standards. It would also limit our flexibility in how we build networks in different regions of Alaska. The end result? Less control over costs, higher prices, and no improvement in the quality of care.

Who pays the price?

Together, SB 121 and 122 would raise costs for almost everyone in Alaska’s private insurance market, including large employers, union trusts, and small businesses. They wouldn’t improve access to care or help people get healthier. They would just shift more financial burden onto families and businesses who are already struggling. And in a state where the working-age population is shrinking, asking employers to pay even more for health insurance just isn’t realistic.

There’s a better way forward

If lawmakers want to improve access to care, there are smarter ways to do it:

Raise Medicaid payments so providers can keep serving low-income patients

Push for higher Medicare rates that reflect Alaska’s true cost of care

Support innovations that improve care while keeping costs under control

Businesses across Alaska face significant challenges in offering good benefits and supporting their employees. Let’s keep working together to make health care more affordable for Alaska.

Jim Grazko is the president of Premera Blue Cross Blue Shield of Alaska.