(The Center Square) – While more Coloradans are choosing the state’s health insurance programs, a report from a group backed by the health care industry found the cost of coverage isn’t meeting expectations.
“Promises Unmet: The Early Experiences of State Public Option Plans” examined public option plans in Colorado, Nevada and Washington. The report, promoted by Colorado’s Health Care Future and published through its parent organization, America’s Healthcare Future, focused on provider premiums and reimbursement rates.
“With particular attention toward Washington State and Colorado, we find that the promise of large premium savings requires setting reimbursement rates for hospitals and providers far below what states appear willing to do,” according to the report. “This unwillingness likely reflects both the political challenges of large rate cuts and the potential effects aggressive rate cuts would have on plan quality and access.”
The report stated its focus on the cost of coverage and the reimbursement rates for hospitals and providers provides an essential view for the overall affordability of the state program.
“The interactions between these dimensions create significant and unavoidable tensions for any public option plan,” according to the report. “Without public subsidies, steep cuts in provider reimbursements are necessary to deliver the promised premium savings, but they may impact consumers access to care or engender political opposition.”
In January, Colorado’s Division of Insurance announced 80,655 people enrolled in Colorado Option plans for 2024 through Connect for Health Colorado. It amounted to 34% of all selections during the open enrollment period and was a 188% increase compared to the 2023 enrollment period.
“The reality is Coloradans chose the Colorado Option in record numbers for 2024, even while special interests continue to try to mislead Coloradans about the Colorado Option,” Colorado Insurance Commissioner Michael Conway said in a statement. “That means that once again, Coloradans are choosing the Colorado Option to save money and get a better health plan.”
House Bill 21-1232 created the Colorado Option and required the state to develop standard benefits for the Colorado Option plans for health insurance companies to sell.
However, the report found the cost of coverage isn’t meeting expectations. Approximately 15% of plans met the state’s first-year premium benchmark and fewer plans met the state’s second-year target, according to the report.
“In short, policymakers’ unwillingness to accept the inevitable trade-offs has produced plans that are unlikely to attract consumers,” the report said.