About 35,000 people signed up for Colorado’s Option health insurance plan in the program’s first year, Gov. Jared Polis announced Tuesday in his state of the state address.
That number includes about 25,000 people who signed up for the Colorado Option plan through the state’s Connect for Health Colorado shopping exchange. Another 10,000 people signed up through OmniSalud, a new program that provides a state-subsidized insurance plan to people who lack immigration documents and therefore do not qualify for federal subsidies offered through the main Connect for Health portal.
The figures provide some preliminary data on the success of the plan, which has been in the works for nearly two years and is a major health policy initiative for the city-state and the Legislative Democrats. But, as expected, interpretations of that number were widely divided on Tuesday.
Polis touted the number as “exceeding initial enrollment goals,” and Colorado Insurance Commissioner Michael Conway said in a statement that the enrollment “far exceeded my hopes for what the first year would accomplish.”
The Colorado Option is a state-designed insurance plan marketed by private insurance companies where the profit is earned and the risk is assumed. It’s basically Colorado’s market-based solution for creating public health insurance options. The Colorado Option program is currently only available in the small group and individual markets. These are places where small companies buy plans for their employees, and where those who don’t have insurance through their employer buy their own insurance.
The Colorado Option is designed to offer better coverage than normal and needs to be sold at a lower-than-average price, though critics question whether it succeeds on both fronts.
beyond expectation
As of Jan. 10, more than 192,000 people had signed up for a health plan through Connect for Health, according to the exchange. Open enrollment closed on Jan. 15, and the final open enrollment numbers have not yet been released — meaning Colorado Option enrollments and totals could still increase. But currently, registrations for Colorado options account for about 13 percent of total registrations on major exchanges.
While the state has never released a projected number of Colorado option registrations, Vince Plemel, a spokesman for the state’s Department of Insurance, said the agency’s internal hope is about 5% to 7% of total enrollments, which means actual About double the number of people they said they expected.
“Maybe I shouldn’t be surprised,” Conway said in a statement. “Not only do these plans create more competition in our insurance marketplace, they also provide Coloradans with better value, with many offering better health outcomes at no cost or at low cost.”
To advocacy groups supporting the Colorado Option, the numbers are a testament to the value the program brings to the market.
“It’s no surprise that Colorado beat the national trend with our CO Option insurance enrollment because we’re giving people what they say they want,” Jake Williams, CEO of Healthier Colorado, said in a statement. “
critics strike back
But for opponents of the Colorado Option, the enrollment figures suggest the plans aren’t attractive to that many — despite the state’s efforts to support the Colorado Option in the marketplace.
The state originally showed the Colorado Option plan first in Connect for Health search results. For people whose existing health insurers are out of the market, the state automatically maps them to the proposed Colorado Option plan, and more work is required if they want to choose another plan. The only plan available through OmniSalud is the Colorado Option plan.
And, while the state says customers can collectively save $14.7 million by choosing the lowest-cost Colorado Option plan instead of auto-renewing their existing plan, Colorado Option plans are often not the cheapest plans available to consumers.
“Most Coloradans agree that a non-standard private insurance plan is a better fit for them,” Brendan Arnold, associate director of the Colorado Health Plan Association, said in a statement.
“More than 87 percent of Coloradons find better value through Colorado health insurance providers, yet efforts that could save people health care costs, such as reducing regulatory burdens, have been lacking.”
Many insurance brokers (people who help consumers shop for insurance plans) agree with this. Meagan Fearing, president of the Colorado Association of Health Underwriters, a broker group, said the Colorado Option plan is often not the best option for the consumers she and other brokers work with. It made her question whether the program was worth investing in.
“I would say the number is a little bit higher than we expected,” Flynn said. “But I would also say it’s disappointing that we’re going through all of this for a small portion of our state’s population.”
Bigger battles are coming
While no legislation is expected to make major changes to the Colorado Option this session — at least none with a realistic chance of passing — the health insurance wars are likely to continue raging in 2023.
This year marks the first time the Insurance Department has the power to drag a carrier into a public hearing if the carrier’s Colorado option price isn’t low enough. (Insurers are required to sell Colorado options at progressively lower prices over the first three years of the program — 15 percent lower in 2025 than in 2021, after adjusting for inflation.)
In turn, those hearings could lead to unprecedented regulatory action by the state — including the ability to tell hospitals how much they can charge for a service to drive down the price of the Colorado option.
For health reform advocates, the hearing is where the Colorado Option Plan really comes into play. Regulators presenting at these hearings will make Colorado options more attractive to consumers next year.
“Some in our health care system have been trying to avoid accountability,” Adam Fox, associate director of the Colorado Consumer Health Initiative, which supports Colorado Option, said in a statement. “With increased transparency, we will ensure that the industry gives Coloradoans what they deserve, which will make the Colorado Option Program more effective next year.”
