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State lawmakers propose public option for Colorado health insurance customers

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Posted at 10:17 PM, Mar 18, 2021
and last updated 2021-03-21 16:36:30-04

COLORADO SPRINGS, Colorado — Democratic state lawmakers will soon begin debate over a bill that would create a public option in Colorado's health insurance exchange. Their goal is to lower premiums, not just on the exchange, but for all health insurance customers in Colorado.

Bill sponsors Rep. Dylan Roberts, Rep. Iman Jodeh, and Sen. Kerry Donovan announced the Colorado Option Health Benefit Plan at a virtual press conference Thursday.

Roberts explained that many counties currently have just one provider that they can choose from on the state exchange, and often the plans are among the most expensive available.

"In the two counties that I represent, Eagle and Routt, there's only one option on the health insurance market for those who buy on the individual market, and those premiums are some of the highest not only in our state but in our country," Roberts said.

He went on to say that a family of four who lives in Gypsum, an annual policy can cost as much as $40,000.

Guests at the news conference shared their frustration at the high costs of premiums. Stephanie Salazar-Rodriguez of Denver told reporters that she recently lost her employer-provided health benefit during the pandemic. While her income from consulting work makes her ineligible for tax insurance credits, she explained that policy premiums for a person in their early 60's are nearly $1,000 a month.

"I didn't expect to find myself in this situation, nobody does, and the options that I have are simply not affordable," Salazar-Rodriguez said.

Noel Emerson, a teacher, told the group that she occasionally puts off medical needs because her out-of-pocket costs are so high under her current plan.

"I would really like to see this not only help me but also help my colleagues who are also struggling with affording our medical expenses."

The Colorado Option would create a state-structured insurance plan offered through a new non-profit entity called the Colorado Option Authority. Hospitals and health care providers would be required to accept the plan, and the state insurance commissioner would set reimbursement rates.

"This isn't about imposing government mandates on the industry or forcing anyone to give up health care that they already have and like," Donovan said. "It's about asking the hospital systems and insurance companies to join us at the table and work together, find solutions to this problem that has persisted for far too long."

The public option plans would be targeted to those who buy health insurance either on the individual or small group markets. Roberts estimates that roughly 15 percent of policyholders in Colorado buy their insurance through those markets. He anticipates that roughly half of them would seek the public option were it made available.

A similar bill was introduced last year but was shelved when the pandemic hit. Roberts explained that they have since heard from industry stakeholders who believe they can lower these costs on their own.

So, the current legislation would give the industry until the end of 2024 to reach a desired 20 percent reduction in premiums. If that goal can't be met, then the Colorado Option would begin in 2025.

A group called Partnership for America's Health Care Future is currently running TV commercials opposing the legislation. The group states on its website that a public option, in general, leaves consumers with fewer choices for coverage, fewer choices of hospitals, and higher taxes or higher premiums.