Colorado lawmakers won’t try to implement a state-run health insurance plan after all, sponsors of a public options bill announced Monday afternoon.
After months of negotiations with the healthcare industry – for the second year in a row – Democrats said they had reached an agreement on how to force insurers and hospitals to cut healthcare costs without make the state an insurance provider.
Bill 21-1232 as it was originally written would have been a phased approach. In the first phase, the state would set the coverage requirements – including “all essential health benefits,” Bill says – for a standard plan that private insurers would offer in the Connect for Health Colorado market. Insurers would also have been required to meet monthly premium reduction targets (20% in two years).
If they hadn’t, it would have triggered Phase 2, where the state would step in and sell an insurance plan through a newly formed nonprofit.
But the sponsors agreed to drop the second phase, which State Representative Dylan Roberts, an Avon Democrat, previously told the Denver Post it would have fun doing if the industry also did. concessions and that lawmakers could still reduce health care costs.
The new public-private plan would be offered in all counties in the state, he said on Monday. About 8% of Coloradans buy their insurance in the individual market and 7% in the small group market.
The updated bill will be heard in committee of the House on Tuesday. If the bill is amended as suggested, it would require insurance companies to offer the new health plan in the individual and group markets as of January 1, 2023.
The cost reduction targets will also change: operators would have three years (by 2025) to offer the standardized plan at a premium rate below 18% of what was offered in 2021, adjusted for medical inflation. . If insurers do not meet reduction targets, the state could step in and temporarily set rates.
“This is a huge victory for the Coloradans, and it is because when this bill becomes law, what we will always get for our voters is an 18% reduction in the premium.s“Roberts said in an interview Monday.
Roberts said the bill’s sponsors don’t believe they are abandoning the bill’s goal of cutting healthcare costs or giving in to the healthcare industry. He said they wanted to make sure they were working with providers who needed to meet the targets while offering more affordable insurance rates.
Groups like the Colorado Health Association, the Colorado Association of Health Plans and the Rural Health Alliance have all told sponsors they would change their stance to “neutral” instead of opposing it if the amendment passes Tuesday.
CHA President and CEO Chris Tholen said in a statement that the group has negotiated with everyone involved with the aim of improving access to healthcare while minimizing negative impacts on health. ‘industry. Still, Tholen called it “an unprecedented intervention in our private health insurance markets” and said the improvements the bill provides “depends on the sacrifice and management of Colorado hospitals.”
Hospitals would not be forced to accept this standardized insurance plan as part of the changes, but could negotiate with insurance companies. If the price cuts are not met or if people with the plan find they cannot use it, the state could call a hearing to resolve those issues, Roberts said.
The amendment would also add protections on reimbursement rates for independent rural critical access hospitals, as well as a formula for a minimum Medicare reimbursement rate of 165% for all specific hospitals and 135% for specific providers. . It would also allow federal funds that, under the original proposal, would have been spent on creating a non-profit organization for the public option to help people buy health insurance.
This amendment is similar to the public option bill that Colorado Democrats introduced last year in that it offers a public-private solution. Washington state has attempted this through its own public options law, and Connecticut and Oregon are considering legislation.