Vail Valley lawmakers Kerry Donovan, Dylan Roberts preview state public health insurance option
Donovan, in announcing legislation, says 'The health care industry isn’t working for Coloradans'
Rep. Dylan Roberts, D-Avon, Sen. Kerry Donovan, D-Vail, and Rep. Chris Kennedy, D-Lakewood, rolled out their long-awaited Colorado Affordable Health Care Option bill on Thursday at the Capitol. The legislation is designed to compel health insurance competition, set hospital and drug pricing and hopefully drive down prices in underserved Eagle County and the rest of rural Colorado.
House Bill 1349 would push private insurance companies doing business in other parts of the state to offer a public option plan in the 22 out of 64 Colorado counties that have just one insurance provider offering plans on the individual market (for people who don’t get their health insurance through their employer). The state will not run the plan but will oversee it. Initially, it would affect roughly 300,000 Coloradans on the individual market.
Eagle County is one of those underserved areas, with just Anthem offering Affordable Care Act-compliant plans on the individual market. A family of four in Eagle County will pay around $1,600 a month for health insurance (before any ACA tax credits if they’re eligible).
Bringing down costs in Eagle County
Roberts, who represents Eagle and Routt counties in the legislature, said Thursday that the public option will bring down individual market prices by up to 20% in Eagle County when it’s available in 2022.
Asked how the state insurance commissioner and an advisory board set up under the bill will decide which insurance providers have to provide a public option, Roberts said the state will lean toward companies that have some history of selling insurance products in a county.
He gave as an example his employer, the district attorney’s office, which offers insurance to its employees through a small-group plan from Cigna. Previous proposals were aimed at compelling more insurance providers to step into underserved markets.
“[Cigna] may be well more situated to come into a county like Eagle than a plan that doesn’t sell any type of insurance in Eagle County. So those are the unique factors that the commissioner and the board will look at to determine which insurance company’s best to move in,” Roberts said. “And it’s a pare-back of what we came out with in the proposal in trying to move a bunch of insurance companies into new counties. We want to pick the one that is the most reasonable to do so.”
Roberts added that a county like Summit, which has the recently created Peak Health Alliance co-op, would not necessarily see a public option plan. Led by the Vail Valley Partnership and Vail Health, efforts are underway to offer a Peak-inspired plan in Eagle County called the Mountain Healthcare Coalition.
“The commissioner can consider that as competition and not have to move a Colorado option company into that county because we want to recognize the great work that some of those collaboratives and co-ops are doing,” Roberts said.
The Vail Valley Partnership’s Chris Romer called those efforts a slog but added they’re making progress. Having not had time to fully dig into the new bill or discuss it with the valley-wide chamber’s various committees and board members, Romer added the VVP does not yet have an official position on the newly unveiled legislation.
Romer wondered how the level of reimbursement for hospitals was set at 155% of Medicare rates for patients on the public option, questioning one average across a state with a variety of regions from metropolitan to rural to resort. And he wants more information on how the bill addresses all health care costs and not just hospital costs, which make up 30% of spending.
“We have long advocated for a market-driven approach, based on incentives to the providers to reach target costs,” Romer said. “This would be a blend of the ‘total cost of care’ model in Oregon and the Colorado option as proposed. I worry about the unintended consequences of mandated pricing and participation and the negative impact this could have on business as mandates are often fraught with unintended consequences.”
Romer promised to dig into the bill deeper, ask questions and provide more feedback.
“We support the concept of the Colorado option, yet we have concerns about government mandates to business, and we recognize the impact of high health care and insurance costs to the community,” Romer said
Vail Health officials declined a request to comment on the bill but in the past have pointed to numerous initiatives they’ve undertaken recently to bring down the high costs of health care in Eagle County.
Donovan said the time to study the public option — after first passing enabling legislation last legislative session — is past.
“The health care industry isn’t working for Coloradans. Everywhere I go I hear people struggling with not being able to access or afford the care they need,” Donovan said. “The Colorado Affordable Health Care Option is a unique, balanced solution that works to address the high cost of health care by asking big hospitals to be part of the solution to increase choice and lower costs. I came to Denver with the promise to put my constituents first and that is what I am doing with this bill.”
The bill’s proponents point to research showing that one-fifth of Coloradans do not seek care because of concerns about the costs. The public option is expected to reduce premiums by 7 to 20 percent, depending on the region, with rural areas on the Western Slope seeing some of the biggest savings. Backers also cited “the state’s near highest-in-the nation profit margins at the largest hospitals.”
The Colorado Hospital Association opposes the public option proposal and for months has aired ads assailing a prospective public option. It says price-setting could force facilities to increase prices for patients or insurers not in the individual market, cut services, or both.
Democratic Gov. Jared Polis has made health care coverage and affordability his highest priorities since taking office last year. A state-supervised public option plan is key to those efforts, Polis says.
To date, Polis and Colorado’s Democrat-controlled Legislature have created a reinsurance market to compensate private insurers for their highest-cost cases; mandated hospital price transparency; adopted consumer protections against surprise out-of-network medical bills; and launched an effort to import cheaper prescription drugs from abroad.
In 2019, Washington became the only U.S. state so far to adopt a public option. Democratic Gov. Jay Inslee has called the program a step toward universal health care.
This story includes reporting from The Associated Press.
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