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On Monday, the Colorado Division of Insurance and the Department of Health Care Policy and Financing released a draft report on the development of the state’s plan for a public health insurance option. With the enactment of House Bill 19-1004, the agencies were directed to gather public input and develop a proposal to submit to the state legislature that would offer affordable health insurance to Colorado residents.
The draft report recommends a new insurance plan that would be sold by licensed insurance companies and cover a comprehensive set of benefits. The plan would be available to all Colorado residents, state-wide. To control costs, the report proposes that the state create a reimbursement fee schedule setting hospital rates between 175% and 225% of what Medicare charges for services. The current rate of reimbursement for Colorado hospitals is approximately 289% of Medicare, so the adjustment would be a big decrease for some hospitals.
As with plans already on the individual market, in the proposed public option insurance companies would bear the risk for health expenses. The state would also seek a federal waiver to further lower costs and potentially provide additional benefits like dental coverage.
Lastly, the report says the state option would ensure that prescription drug manufacturer rebates are passed through to consumers and consumers see the full benefit of those rebates through lower premiums. While there is little detail in the report about how this would be implemented, we were encouraged to see this language included.
CBSA is committed to ensuring patients have access to the medicines they need, and we recognize that right now many patients are faced with unreasonable out-of-pocket costs due to high cost-sharing or high-deductible health plans. The association continues to advocate for policies that require carriers to share manufacturer rebates with consumers at the pharmacy counter as a way to lower out-of-pocket costs.
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