NewsPolitics

Actions

Colorado public health insurance option bill gets first committee hearing

colorado capitol colorado state capitol 2015 ap
Posted at 6:38 PM, Apr 09, 2021
and last updated 2021-04-09 20:39:50-04

DENVER – A bill that would introduce a statewide public health insurance option if insurance companies don’t lower their rates over the next few years faced its first committee hearing Friday at the state Capitol to mixed reviews.

The bill, HB21-1232, was unveiled last month and received its first hearing in the House Health and Insurance Committee.

The measure contains a two-phased approach, first encouraging insurance providers to offer a standardized health insurance plan developed by the state for individual and small group plans that would have to be 10% cheaper in 2023 than the premiums offered in 2021 and 20% cheaper by 2024 unless purchasing alliances have already reached those goals.

In 2025 and the years that follow, insurance providers would not be allowed to increase those premiums by any more than 1% on top of yearly inflation.

If the consortium cannot meet the goals laid out by lawmakers on their own, should the measure pass with the same benchmarks, then Phase 2 would kick in, in which the state would implement its own public option plan, the Colorado Health Insurance Option, to compete with other insurers on the individual and small-group markets and which would be 20% cheaper than current average premiums on a county-by-county basis.

The public option and startup costs would also rely on the Biden administration approving a 1332 waiver before it could be launched.

Rep. Dylan Roberts, D-Avon, is sponsoring the bill and says he and other are pushing it forward after a similar bill was withdrawn last year because Coloradans continue to struggle with high health care costs.

“My constituents who buy on the individual market only have one choice, and those prices continue to rise much higher than the rest of the state,” he said in an interview.

Some small business owners voiced their support for the bill during Friday’s hearing. The owner of Sazza Pizza and Salads in Greenwood Village, Jeff Rogoff, said that providing affordable and accessible health care would boost employee morale and retention and ultimately help the business’s bottom line.

Colorado public health insurance option bill gets first committee hearing

“We need a sustainable solution from our state legislators to help us do just that,” Rogoff said. “The Colorado health insurance option is a common-sense solution that would help level the playing field for small businesses like mine that can provide robust benefits like larger businesses can.”

Ross Brooks, the CEO of Mountain Family Health Centers in Glenwood Springs, also testified in favor of the measure, saying that 7,500 of the patients the health care group treats do not have insurance despite the expansion of Medicaid and offerings from Connect for Health Colorado.

“At the end of the day, there’s still 7,500 human beings within our organization who do not have health insurance. So, on behalf of those folks, I’m encouraging you to support this legislation on behalf of Mountain Family Health Centers.”

But another rural hospital CEO, Kevin Stansberry of Lincoln Health in Hugo, had been waiting to testify remotely in opposition to the bill.

His hospital on the Eastern Plains is the only one along I-70 between Aurora and Burlington, and he believes that the public option bill would harm his hospital if passed.

He told lawmakers that the hospital has among the highest insurance rates in the state, but also the third-lowest hospital charges. He said 75% of the patients at Lincoln Health use Medicare or Medicaid, so the hospital relies on commercial insurance to make up the losses. But he’s worried the public option would push the hospital over the edge.

“We’re going to be financially threatened and we’re going to have to figure out another way to do more with less,” Stansberry said. “There may be some hospitals that can’t do it and have to close.”

He said he thinks the bill is a threat to one of the largest employers in the area and voiced concerns about the rate schedules, saying that rural hospitals can only charge about half what the urban hospitals do.

“There’s no guarantee that those rates will cover our costs,” he said.

Stansberry added that since most of the hospital’s bills get paid from people on individual and small group plans, he worries about the bottom line if those people end up on a reduced-rate public option.

“I just think this is the wrong way to solve the problem. I don’t think it’s good policy,” he said.

But Roberts disagrees with his characterization, insisting the hospitals will survive while their patients save money.

“This actually will reimburse hospitals in our rural parts of the state, I think, at a higher level than they’re currently getting reimbursed,” Roberts said.

Friday’s hearing represented one of many hours of debate this bill is likely to see as the state considers a different way to reduce Coloradans’ health care costs.